Sunday, July 21, 2013

Success During A Weak Recovery

Between 2009 to 2012, one of the companies for which I did part time work increased revenue over 50% and doubled its workforce.    I thought that was pretty impressive, especially since flat was considered the new up during that time frame.  However, success didn't happen by accident.  The company management took specific steps to grow the business and the actions worked.

Here's what the company did based on my observations:
  • Set stretching growth goals.  The previous management was satisfied with maintaining current revenue and profits.   The new management set a goal of becoming one of the top franchisees for revenue and profits.
  • Re-evaluated product mix.   The previous management focused on high margin product offerings and had significantly overweighted the business towards these offerings.   The new management decided to achieve a  move typical mix of offerings and decided to increase the lower margin, but still very profitable, offerings.   He specifically marketed the lower margin offerings very actively and significantly increased the number of customers.
  • Hired new staff.    The old staff was very qualified to run the old business, but necessarily the new business.  The new management hired new staff that supported the new goals and target customer.  
  • Measured progress.  Using the franchise metrics, the new management showed significant progress from the very beginning.  Within a year, the franchise has moved from a top 50 franchise to a top 5 franchise.

  • Terrific business results which created more jobs, which shows that businesses can do extremely well even during a tough economy.

    For more on New Beginnings, check back every Sunday  for a new segment.

    This is not financial advice. Please consult a professional advisor.

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