In the material handling equipment industry, this discredited business model is still in evidence. Too many companies have played the merger game, putting themselves in markets they know nothing about. Many have played the numbers game, shifting money from pocket to pocket to make they look good for the second quarter (this is called managing for stockholder value), long-range planning. Forget it completely. Worse, too many companies have bought into the concept of giving up profits in pursuit of market share with the idea of being profitable after the competition is over. This is called "buying a job," which means submitting a bid that makes a small profit or profit. In theory this has two advantages. It gives you a job, makes your sales figures (if not your profits) look impressive. More importantly, for some people, it prevents your competition from getting the job. With the economy improving, many in the content management industry are hoping for better times without making any changes to the way they do business. Unfortunately, this means continuing certain practices that played a major role in crippling the economy a few years ago.While the Internet was growing; they experienced rapid growth with the simple method of offering impossibly low prices and continued to expand into markets they knew nothing about. They promised investors that all this would change when they achieved significant market share. Eventually, sure enough, this "loses a little on each trade but makes it up in volume" business model blew up in their face. One bubble after another burst, and the economy followed them down the tube.
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July 2023
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