A machine shop wanted to branch out within the oil and gas industry so they wouldn’t be so dependent on one major customer. They brought on two new salespeople and saw an initial surge in sales.
But then sales dropped off quickly.
They researched the market and found they were charging too much even though earlier research showed that the market would pay more for higher quality work. The team decided the earlier analysis was flawed because new customers were not coming back.
One of the biggest problems was that the company had high-end equipment which gave them many advantages but added to their costs.
The team was ready to scrap the effort and go back to their one big client when Imperial’s consultant discovered the internal cost estimates on each job were not accurate.
Since they were not operating at full capacity, the actual expense of taking on each new project was smaller than what they had been estimating. They started bidding lower on all new projects. Customers started signing up.
This was a very simple solution, and the result was more customers and significantly more revenues from a much broader base.
Imperial’s experienced “fresh pair of eyes” saw the problem and helped them grow their business.
