New Business Model

June 24, 2011

Q: Our company needs to find a new business model as we just can’t compete on price any longer. How and where do you start?

A: I suggest starting with a financial comparison between your company and others in a similar size and scope. I often find glaring differences with integration companies in areas that can be fixed as opposed to starting all over. For example, the fixed and variables costs associated with projects may be really an overhead problem. Or, you may have an underlying productivity issue that simply places too much burden on each project. Your installation team may be way out of the range for typical install times for devices. It could be a number of things.

I’ve never seen a company be successful as both a low-price supplier and a value-added integrator. That’s where the business model does need addressed. You will have to decide which path to follow and give up one of these strategies. The best place to start is to contact our office and have a membership rep walk you through the Market Intelligence Briefing research and Financial Analysis reports. It will take some time, but you will find out quickly if your business model is obsolete, if your productivity is in the right range, if your compensation plans are a problem, if your expenses are in line with others, etc. Don’t hesitate to call … it’s what we do. — CW

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