Case Studies
Facilities Maintenance Company
Situation
Buoyed by its stellar past operational and financial performance, the Company embarked on a rapid growth strategy by focusing on securing contracts with large national retailers encompassing hundreds of locations. Top-line revenue soared. However, the management team was disappointed to find margins, profit, cash flow, and customer satisfaction rapidly declining.
27%
of Customers were losing money
$12.4m
business value lost
Commercial Building Construction Company
Situation
By catching a wave of rapidly-rising demand in the local market, the company took on a wide range of new projects and aggressively recruited talent to keep pace. While enjoying three years of 20% annual revenue growth, the management team was confounded as profits fell and profit margins slumped to less than half of the industry average.
36%
of Customers were losing money
$2.8m
business value lost
Logistics and Distribution Company
Situation
Facing declining sales and commoditization of the offering upon which the company had been founded, the Company added two distinctively different services in an attempt to grow sales. Motivated by top-line sales target incentives, revenues grew. However, even though all three offerings were priced to yield the same gross margin, profit plummeted.
65%
of Customers were losing money
$777k
business value lost
Food Processing Company
Situation
Betting that it could generate more profit by delivering a higher service level, this food processing company stimulated rapid growth by making enormous capital investments to provide customized, less-than-bulk offerings. Expecting both profit and margins to grow in sync with rapidly-increasing top-line revenue, the management team was surprised and frustrated that both net profit and margins were instead falling rapidly
41%
of Customers were losing money
$19m
business value lost
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