Analyzing a Problem/Proposing a Solution
Albert Einstein once said, “In the middle of difficulty lies opportunity.” And right now, the Plunkett Corporation has its difficulty, namely our sharp decline in sales. But rather than becoming panicked by this downturn, I'd like to take Mr. Einstein's advice. After all, he was a pretty smart man. And I am confident that we do have an opportunity here. Not only can we solve our problems and reverse this decline, but in so doing, we can also make changes that will eventually raise our profits higher than ever. I'll tell you exactly how we can do that in a moment.
But before I can share with you my program for combating our problems, it's important that you first understand them. As you know, I have hired an independent consulting firm to come in and help us analyze this situation. After a three-week period in which they've interviewed and observed us carefully, they have identified three major factors behind Plunkett Corporation's drop in sales that I want to now share with you.
One, we are losing our retailers. Several key retailers have stopped ordering from us entirely, and those that we still have dealings with have been ordering from us far less frequently. Speaking with representatives from these retailers, our consultants heard complaints about the lack of personal contact they receive from us and what they perceive as a decline in service. Our retailers have become frustrated with dealing with our sales reps via telephone and fax, and complain of the difficulty they've had getting responses to their questions and problems. As a result, many of them have turned to other companies with better service.
Two, we are losing consumers. At one time, our marketing and advertising worked for us, but it has become terribly outdated. We've typically geared ourselves to the twenty- to thirty-year-old demographic group. But as they've aged, they've stopped using our products, and we've failed to create new marketing and advertising to appeal to today's youth market. Simply put, we're no longer reaching the people we need to.
And three, we are losing money, money that we shouldn't be losing. The consulting team has prepared a listing of all of our unnecessary expenditures that I am now making available to you. Individual items on this list cost as little as pennies and nickels a day, which is why we often don't give them serious consideration. But when added together, they cost us an astonishing $100,000 in unnecessary spending each month!
So, thanks to our consultants, we now know the three factors behind our declining sales: losing our retailers through poor service, our consumers through outdated marketing and advertising, and our money through wasteful and unnecessary expenditures. That's the bad news. The good news is that having identified the problems we have now come up with solutions.
First, based on the listing of expenditures provided by our consultants, I am trimming the fat here, effective immediately. I am passing out to each of you the new, far more modest monthly budgets for each department. By cutting those pennies and nickels spent each day on the unnecessaries you'll find you still have plenty of money for your operating costs.
Second, I am going to take the money cut from those budgets to help us foster better relations with our retailers and customers. To begin with, I am authorizing more on-site sales visits within the tristate area. Within the week, I want every member of the sales staff to create a sales call itinerary for themselves and submit it to me. I am also instituting a new bonus system; for each client who you get and hold onto for the year, you'll receive an additional $500 at year's end. Do what you need to keep those clients and keep them happy.
Third, I want us to work closely with marketing to revamp and add to our marketing materials. For one thing, we need to present the most up-to-date sales brochures as possible. Perception is everything and we need to appear as current as we actually are. We cannot afford to look out of date. Technology is moving so fast that what was current even months ago is now obsolete. We need to stay on top of the trends. I'm also hiring a new advertising agency and increasing our advertising budget. We're going to create new, more aggressive campaigns and target them to a broader market.
This is the program I've developed along with our consultants. But I can only put the initial steps in place; you're the ones who have got to make them work. If you succeed, though — and I am certain you will — not only will this time of difficulty be at an end, but we just might be entering a time of our greatest prosperity, and we'll all be able to take part in the benefits. When next we meet, rather than looking at our failures and difficulties, let's be in a position to celebrate our profits and triumphs.