Time to Focus on Profits vs. Growth
One of the nation’s biggest retailers, Lowe’s, is closing 20 of its 1,700 stores in an effort to increase profitability amidst weak consumer demand. The company has also decided to ratchet-back the pace of new store openings, from 30 per year to 10-15 per year.
Virtually every lawn and garden equipment dealer and landscape contractor we talk to has shifted their focus from expansion and growth to operational efficiency and profits over the last year or two. In most instances, their efforts have been rewarded. The steps they’ve taken to improve the customer experience, all while reducing waste and improving their margins, have now put them in a position to grow sales by stealing market share from those who haven’t made the necessary adjustments.
Some companies, such as our 2011 Pros in Excellence and Dealers in Excellence winners (which you’ll hear about on October 28), have actually continued growing sales–even though they haven’t focused on doing so. They represent another example of how striving to be the absolute best you can be–to yourself, your employees and your customers–can allow the rest to fall in place.
Good luck improving your profits, Lowe’s. Your absence in 20 markets across the country will be welcomed by independent lawn and garden equipment dealers with open arms.
~ Gregg Wartgow, editor in chief
November 4th, 2011 at 3:02 pm
This is very interesting. I did not know Lowe’s was heading in this direction. The interesting thing, however, is that more and more people are doing this very same thing, like you say.
I am a member of a few different lawn and landscaping forums and I’ve been amazed at how many people are finding that they make more money when they drop specific clients.
I guess even crunched some numbers and realized the same thing. Very interesting indeed.
November 4th, 2011 at 3:03 pm
Edit: I guess LOWE’S crunched some numbers and realized the same thing..
Sorry about that..
December 20th, 2011 at 12:00 pm
Companies should NEVER have been focused on either profits or growth! Focusing on profits and growth is what has destroyed Mainstreet (the REAL ECONOMY) in order to maximize Wall Street’s profit margins. This philosophy of business is so short sighted and typical of the screwed up, greedy, and selfish way corporations do everything. I could see this mess coming twenty years ago, but no one wanted to listen to me. Quit listening to Harvard MBA’s! By focusing on integrity and quality and taking care of your employees (remember loyalty IS a two-way street) and your customers’ needs over whimsical “wants”, things will fall in to place and workout for the best in the long run.