Duke of URLCarl V. Natale is an avid fan of small business in Maine. He uses this blog to share useful advice and tips each day. And you can learn more by following @MaineBusiness on Twitter.
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How to make money when clients spend less
Apr 23, 2009 07:30 AM
Categories: Finance
If you're skeptical about claims that there is good money to be made in this economy, you need to read this New York Times story about a logistics company that makes money from clients' shipping savings.
PA & Associates will analyze a company's shipping costs and procedures. Then Richard and Juliette Palarea will pitch a plan that can save them 42 percent (on average) without sacrificing service. The biggest problem they have is that it sounds too good to be true.
You could call it a mom and pop operation. Richard and Juliette started it as a sideline for Juliette. When Richard became unhappy with his corporate job, be became full time.
And business is booming. So far in 2009 they have 10 contracts. That's usually a year's work. The economy has companies looking for savings everywhere. And they're eager to save money in shipping - especially if it doesn't mean compromising service like the Palareas promise.
When they started, they focused on service and quality. They didn't want to cheapen their brand by emphasizing the savings. But this economy persuaded him that his savings promises didn't imply shoddy services.
That's a good point to consider. Consultants will tell you not to cut prices. You're going to cut your margins and train customers to expect lower prices even when things get better. But that's not what the Palereas are doing. They're not selling discounted goods. They're helping businesses survive a recession.
That's a big opportunity in this economy. Everyone is looking to cut costs. And if you can help someone spend less, you deserve a piece of that.
There's a lot of good stuff in the Palereas' story. They know who are the key decision makers to target. They use referrals to grow their business. They're on the edge of expanding. It's a must read for everyone in business.
PA & Associates will analyze a company's shipping costs and procedures. Then Richard and Juliette Palarea will pitch a plan that can save them 42 percent (on average) without sacrificing service. The biggest problem they have is that it sounds too good to be true.
You could call it a mom and pop operation. Richard and Juliette started it as a sideline for Juliette. When Richard became unhappy with his corporate job, be became full time.
And business is booming. So far in 2009 they have 10 contracts. That's usually a year's work. The economy has companies looking for savings everywhere. And they're eager to save money in shipping - especially if it doesn't mean compromising service like the Palareas promise.
When they started, they focused on service and quality. They didn't want to cheapen their brand by emphasizing the savings. But this economy persuaded him that his savings promises didn't imply shoddy services.
That's a good point to consider. Consultants will tell you not to cut prices. You're going to cut your margins and train customers to expect lower prices even when things get better. But that's not what the Palereas are doing. They're not selling discounted goods. They're helping businesses survive a recession.
That's a big opportunity in this economy. Everyone is looking to cut costs. And if you can help someone spend less, you deserve a piece of that.
There's a lot of good stuff in the Palereas' story. They know who are the key decision makers to target. They use referrals to grow their business. They're on the edge of expanding. It's a must read for everyone in business.
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