It’s Only a Matter of Time Until Sales Take Off

TypeFixing Stuck Companies
Quick Facts$5 million manufacturer of high tech electronic components ("ElectricBoxCo") with one manufacturing plant/R&D center. Backed by two venture capital investor groups.
ChallengesElectricBoxCo was founded by two entrepreneur/engineers. They brought in an outside CEO to run the business while they concentrated on engineering/operations/R&D.
The company was consistently not hitting sales targets and was burning through cash. Management said 'It's only a matter of time until the market embraces our products and sales take off.' They were looking for go-to-market advice from a 'marketing consultant'. The investors wanted more - they wanted a 'complete, objective review of the company.' They were stuck.
ApproachMcHugh & Company was retained to conduct a comprehensive review of the company. The review found:
  • management and investors did not agree on strategic direction
  • they did not have a good understanding of the real target market - it was very small and had little growth potential
  • the sales processes were slow and costly
  • high cost of goods sold (losing money on every product shipped)
  • customers really liked the company and the products
ResolutionOnce everyone agreed on the facts and the current market realities, a clear go forward plan was established:
  • new product development plan was launched
  • aligned management team around growth market segments
  • overhauled roles and responsibilities of sales team
  • changed heavy touch, heavy cost direct sales approach to emphasize an internet/online effort
  • reduced cost structure to slow cash burn
  • new equity directed at new markets/new R&D


The company maintained a strong position in their small market, regained confidence of the investors and pushed into new growth market opportunities.
Links to the other fixing stuck company cases:
  1. Establishing Focus in a Family Business
  2. Less is More: Downsizing to Increase Profits

To view a list of all McHugh & Company Case Studies, click here.