Pro Clean is in fact a carpet cleaning firm situated in Knoxville, which is in Tennessee. Kevin Wilson’s affords to expand business have had incomplete success, he is fighting to determine the tactical direction he ought to take. In spite of the fact the company’s small size, Kevin Wilson has a chance to clarify business circumstances and launch the finest way to control the sources by utilizing a strategic management process. Kevin Wilson began to work as the one-person show, but extended his business two years ago. Wilson’s plan of expansion was to duplicate the leading firm in the sphere, King Rug’s expansion model. Thus, Wilson moved the office, which was previously at his house into a commercial institution, hired three workers for the cleaning work and purchased two more vans. He also initiated an internet page for his firm.
The most important problem in the case is that Pro Clean decided to duplicate the leading firm in the sphere, King Rug’s expansion model. But the firm did not duplicate it till the end and it did not set the higher prices. In view of the fast expansion, the firm suffered from little flows of money because the organization didn’t increase three folds as it was previously expected. Actually, everything has even got worse. If everything remained status quo, then, we may believe that there will be an opportunity for Pro Clean to go out of business.
The Solution to the Problem
First of all Wilson should have set the higher prices to compensate company’s expenses for salaries, cars and other necessary things. Wilson decided to duplicate the expansion plan of King Rug and the higher prices should have become the primary step according to this plan. There is one more solution. If I were in Wilson’s status I would not have expanded the company, at least so soon. It appeared that Wilson was doing just fine when he was obtaining 75,000 US dollars a year as an owner before wishing to become the competitor of King Rug. By expanding the company an owner takes a risk of boosted pay rolls for more workers, equipment, cars. Most likely I would have spent earned cash on capitalizing on the firm’s weakness, for instance, the technician’s sales and customer service skills. I would give job to the skilled speaker who is good with sales tactics to go over the various scenarios, which may take place to help close possible sales. For the initial couple of weeks I would have an hour training meeting to discuss sales tactics together with emphasizing how sales motivations may assist the firm and the employees. The technicians have to distribute brochures and even ask the clients if they do not mind if they could place a “Pro Clean” sign on their territory for a couple of weeks. This will assist in raising awareness for the organization around the district, which is great since neighbors usually trust each other and should think Pro Clean is a nice firm. The employees should tell all clients they would obtain a discount for the next servicing. It will assist in generating more loyal clients, since they feel obligated in utilizing a discount). The motivation for the personnel is that for their route that they serviced for one new customer, they’ll obtain a per cent of each of those referrals. After initial two weeks I would hold merely half an hour meeting at the beginning of the week to discuss the sales tactics, aims and goals. Also it is important to concentrate on internal and external environments of the firm to find out the abilities and central competencies, thus, providing several advantages which could be rather competitive. Conducting an analysis of the external and internal environments will assist him in determining the steps that may be taken to achieve competitiveness and survival of the company.
Strengths. The company holds a respectable five per cent share of a Knoxville carpet cleaning sphere and is rising at the rate of almost five per cent annually. The organization possesses an important place in the northeast district of the city. It has loyal and pleased clients, generating 60 per cent revenues from repeat business.
Weaknesses. When Wilson repeated the King Rug model by escalating personnel, cars along with some rented office place, the owner didn’t adopt the King Rug’s higher price organization to cover some extra expense items. Hence, the firm is experiencing bad financial work without high prices. Because of van lease and payroll, money income has become an important matter. Besides, the development is not producing a satisfactory degree of pure income for the owner. Actually, while looking for the answers to the existing dilemma, the owner has taken on extra expenditures that cause additional monetary delays.
Pro Clean badly needs new clients and work, but doesn’t possess the marketing proficiency or sources to attract new clients. Only ten per cent of business nowadays comes from marketing attempts. Clients are not targeted in line with the profile of requirements. Additionally, the company’s present staff doesn’t correspond to the functional necessities of the firm.
- Cleaning: in spite of the inactive technician time during the daylight hours and Wilson’s choice not to be constantly involved with clean-up, he’s covering tasks, that are planned for the evening hours and at the weekends;
- Marketing: the organization has no marketing practice or skills needed to attract novel clientele;
- Accounting: the owner claims he does not know how to make records, and Scott’s background isn’t related to coping with financial transactions;
- Zone Scheduling: the capability to reduce operational expenses are hampered by the incapability to correctly perform zone scheduling. In the meantime, the owner is performing secretarial tasks. Wilson was unsuccessful leader during controlling the company’s sources, and personnel compensation doesn’t give up desired behavior.
Pro Clean is in fact a carpet cleaning firm situated in Knoxville. The owner of the company made up the decision to expand the business. In view of the fast expansion, the organization suffered from little money flows because the organization didn’t increase three folds as it was expected before. Actually, everything has got worse. The problems happened because the firm repeated the King Rug model by escalating personnel, cars, and rented office place, but Pro Clean didn’t adopt the King Rug’s higher price organization to cover some extra expenses. Another appropriate resolution for Kevin Wilson is to analyze both internal and external environments of the company to focus on the abilities and central competencies to provide advantages that could be rather competitive. Conducting the analysis of the external and internal environments may assist the company in determining the steps that may be taken to achieve competitiveness and survival of the company. In spite of the firm’s small size, the owner has an opportunity to clarify business circumstances and launch the finest way to control the sources with the help of the strategic management process.