Another RED month!

Dear all,
I just reviewed January month-end figures and I’m still struggling to imagine should a "BLUE" bottom line is still possible in the near future? I try to be optimistic, but reality is I cannot figure out how long this will take. Just as an observation, February daily data shows that up till the 11th of the month sales are ranging $1,577,68 avg on a daily basis. If we think 28 days in the month will total $44k, this will definitely lead us to another RED month. The cummulative P&L today is $34k LOSS, which means for me a NEGATIVE ROI of 6,8% over an year of investment.... Even those ridiculous Real State EB5 Project investments are much, much better than this!!!

We are now at 9th month of operation and annualized sales range $500K. A reasonable number would be ranging $800K, so at 62% of the target after 3 quarters of operation.

On our previous months we suffered to bounce it back the Cost of product sales to the targeted 30%, but January made it recover its bad history at those horrendous 40%.

Payroll Cost seems to be stabilized ranging 25%, but not sure would we be able to increase sales at this work force level…

Todays’ ratio on rental costs is high up at 13,7% of total sales…. Just as a reference, I’ve seen some business for sale on Subway stores, where franchisor (landlord) charges 6% of total sales from its franchisees… Meaning current rental cost is double it should be! It might be even worse on the new store!

At this point in time I’m questioning myself: Are we leading this business or is the business leading us? I do include myself in this doubt!
If we do not find a turning point, this is going from bad to worse with the new store!

Customer Satisfaction might have been resolved at this point. I start seeing some positive comments on the new management and better than that, stop seeing repeated claims on the quality of service. I understand the reason why we took so long to fix it, but as I commented several times, this might have cost us an year of profit, thats why we have no rights of repeating this again on the new store.

I’m sure we are all professionals and are trying our best to succeed, but I’m hardly seriously questioning are we doing the right thing?
Let’s discuss this on our next meeting on Friday.
Best Regards
Alcides

Comments (1)

  1. Amanda Ramirez :

    Alcides,

    I have forwarded this message to the whole team and we will address it tomorrow on our monthly meeting.

    Thank you

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