Page 84 - Paulisms: Gold Nuggets for Small Business

The deterioration in many areas was in view of the lack of focus and being too busy. The network was trying to cross-sell into other products (which confused the customers), and their closure rates went down. Looking at a graph of profitability, the turnover was going up but the profitability was the inverse, and the business started to lose money. We were top-line driven rather than bottom-line driven. I learnt a lot from that mistake. I learnt to protect our margin and that the bottom line is more important than the top line!
It got worse. We didn’t control the brand, others did, and we were helping develop the market for others. Not just for the supplier, but all the resellers. Zillions of them! Our model wasn’t right, as we were resellers and other competitors went direct to market. The market matured. Prices started to drop. We had to get out, and we did! But we should have moved sooner. In reflection, should we have diversified? I think not. We should have focussed on our core high-margin product that we controlled from