- September 24, 2018
- Posted by: Jennifer Lawson
- Category: FreshXpertise, General, Management, Retail Management
How good produce companies go bad
By Ron Pelger
There are many produce companies that were once leaders in the industry but have suddenly discovered themselves struggling to keep their heads above water. Some of those companies have already bitten the dust.
- 20% of businesses are doing the right things
- 30% are in a struggle to survive
- 50% are in various stages of going out of business
Every day, some produce operation goes bad. It could be a grower who loses an account due to poor service or a retailer who allows its competition to steal their business simply because they are hesitant to protect their marketing grounds.
Some produce operations are in worse shape than they realize. They are stuck in the past with old traditions while rapidly changing business conditions pass them by. Many of their produce methods have long become obsolete. Left ignored and unchecked, a produce operation can develop into an enormous expense.
We hate bad news as much as anybody in this business. However, for some, the worse is yet to come. Many produce companies are dazed and confused as to which avenue to take in the way of making ends meet. Some company executives just do not know what they can tackle right now.
How could all the highly paid executives keep on stumbling so badly? What steps can CEOs and corporate officers take to avoid unfavorable consequences for their companies? What are some causes of running a bad operation, especially in the produce industry?
Here are six basic roadblocks that will put your company out of business:
Lack of management ability — Without a doubt, the largest single cause of business failure is mismanagement. Many CEO’s use a cost managing philosophy. They find it easier to initiate across-the-board cuts whenever there is the first sign of trouble brewing. Then it always becomes more damaging to the company.
Hesitant to move forward — Many companies are stuck with old practices. The only way to move into the future is to let go of the past and the present. Companies must continually strive to improve. They can’t do things today as they did yesterday and expect to be successful.
Hodge-podge merchandising — Setting up produce displays that absolutely make no sense is like scaring customers away. Again, this comes from poor direction by management. Consumers do not like to shop in mayhem.
Weak marketing concepts — Those good old marketing vice presidents who continue to use the same old gimmicks usually get the same old results —— nothing! They have developed comfort paralysis.
Slosh service — Cutting head count reduces customer service as well. It’s harder to please customers when you’re struggling to fund customer service. When customer service levels are low, the sloshing starts to grow worse.
Copycat operating methods — Monkey see, monkey do. There’s a lot of this going on now. Some companies just don’t use their own original ideas. Want to lose every time? Instead of being an innovator, just go visit your competitor and copy whatever they do.
There are plenty more reasons why companies go from good to bad. Usually, the companies that become bigger and more successful eventually develop risk factors because they avoid further innovation. They often fail due to poor management risk.
When the choke period sets in, senior management starts to push panic buttons as they try to steer away from the threats of bankruptcy and liquidation. However, in the hurry-up process, they over promise, over commit – and under perform.
So, what’s the solution? Engage with outside experts who have the experience and talent to lead you on the pathway to results.
Anthony Totta—business development and strategic planning
Tim Vaux—succession planning, strategic planning
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