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$1.4 Billion...and Bankrupt. Lessons??
Unless you have had your head buried in the sand, you probably know that Circuit City is toast. How did that happen? How did a company with $1.4B in 2007 online  sales (not counting retail) go belly up? More importantly, what can small business learn from their massive failure?
First, we can remind ourselves that service matters - and that we must continue to provide top notch service to our customers & clients every day. Unfortunately, Circuit City forgot this golden rule years ago as they kept too close of an eye on the bottom line.
Second, if you have employees, treat them well. Circuit City had some of the best commissioned sales people in the business. However, they made the "brilliant" move in 2003 to cut all commissions - seems that these folks were "costing" them too much money. So they laid off their 3900 best salespeople. The rest of the top performers soon left once the opportunity for commissions was gone. Then in 2007, they again laid off 3400 of their highest paid sales force. Pure and simple.....stupid. As my daddy always said, "Dance with the one that brung you!"
Third, you must continue to provide value. If you've read this newsletter (or my blog) for any time, you know that I believe value creation is the crown jewel of small business success. The marketplace is an impartial beast and does not discriminate. If you are not making the money you would like to make, you are simply not providing enough value to your marketplace. If you can latch on to this single concept and take 100% responsibility for the implementation and execution or your value, you will be successful. As a matter of fact, you will find that you virtually eliminate the competition.
Fourth, the faltering economy is not to blame for your poor sales - it simply exposed weaknesses that have been there all along. In good times, anyone can prosper. In the mid to late 90's there were many companies raking in unforeseen levels of revenue - all funded by blind venture capitalist. I witnessed so-called salesman that could not sell a life jacket to a drowning man manage to make six figure incomes....all because times were good. You see, when heat or pressure is applied to any material, the weaknesses are then exposed. The same is happening to many small businesses today.
So join me in taking the contrarian road to small business success. Learn from the failure of others. Your customers, employees, and pocketbook will all thank you!
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money flow in our society? What's the big deal with small business?
