Our client has been in business for over 50 years, and is family owned and operated. Sales volume last year was in excess of 5 Million Dollars. One would think with such a large volume of money going through the doors every year, that the owners would be happy, not so!
In the Discovery stage of the Smart Business Doctor process, we conducted a Business Assessment, which, is designed to determine the core reason why profits are not as high as they should be.
The clients were perplexed as to why they worked so hard all year long, to bring in the most sales, pay the bills, and find out at the end of the year, there was no money (profits) left over?
The business assessment process identified, very quickly, the very high labor costs that were associated with COGS, was inconsistent year to year, and represented an unusually high percentage of over over-all Sales. This was extremely problematic because, it had been going on for many years, without knowing why, and without correction. Also, problematic because high labor costs, directly impact and drop to the bottom line of profitability of the business.