Sink or swim: experts offer tips to keep public companies high and dry.
Utah Business › Vol. 23 Nbr. 7, July 2009
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Sink or swim: experts offer tips to keep public companies high and dry.
The past year has been a wild ride for Utah's public companies. Overstock.com stock has gyrated from $29 per share to $7 and back to $12. Headwaters Incorporated stock has moved from $16 to $1.22 to $5. Merit Medical Systems stock has bounced from $21 to $9.50 to $16, even though, as founder and CFO Kent Stanger states, "Our revenues haven't dropped and we've continued the double digit growth which we've had nearly every quarter for 20 years. We can't control the psychology of the market." So, what are Utah's public companies doing to survive now and position themselves for a rebound later?
Getting Granular "Bad economic times force you to do the things you should do anyway," says Patrick Byrne, CEO of Overstock.com, a major online retail sales company. "Bad times make you lean out your company and get granular about your expenses and return on investment." For Overstock.com, "getting granular" includes doing a careful analysis of what products and customers are most profitable. "Two marketing channels may look the same," Byrne says. "In both cases we may spend $6 million and get $100 million in revenue. But customers who come through one of the channels may be more likely to return, making that a more valuable marketing channel to pursue." Another example of "getting granular" is measuring the real costs of serving the customer--analyz...See the full content of this document
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