Increase Revenue & Profitability

Client Organization

A small manufacturer of tools and equipment for automotive technicians and battery specialists had overtime created a variety of logos and packaging alternatives. The original project was to settle on a single approach that would be consistent across all marketing materials. In the process we realized that the company had developed a reputation for developing innovative new products and had the potential to expand their business into new markets and to spread their costs over a larger sales base thereby improving profitability.

Client Objective

The original objective was to standardize the branding of the company. It evolved into expanding the business and improving profitability.

• Review all marketing materials.
• Analyze & recommend Inventory reductions.
• Educate and empower employees to reduce inventory and improve productivity.
• Explore & expand customer base.

What was done?

We reviewed all marketing materials and proposed changes to the logo, packaging and advertising.

We worked with the sales effort to expand the customer base.

We reviewed the inventory and made specific suggestions to discontinue and drop items and lines.

We educated the employees to the financial realities, how to utilize LEAN thinking in their areas of responsibility and developed an incentive system that was focused on areas where they have an impact.

Outcomes

When we started in the spring of 2004, sales were a little over $100,000 per month and turns were about 1.49. Net operating profit was -6.86%. Over the next 13 months, sales increased to almost $300,000 per month. Turns improved more than doubled to 3.27 and net operating profit made an incredible 22% swing from nearly -7% to a plus 15%.

These results were achieved as the result of a number of activities that included the above actions as well as successful new product introductions and staff reorganization.

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• Increase Revenue & Profitability

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