October 23 2010
Volume 40, Issue 20
40
20
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On average, respondents to the latest quarterly MDM/Baird survey said third-quarter revenues were up 6 percent.
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Jonathan Byrnes, senior lecturer at MIT and author of new book Islands of Profit in a Sea of Red Ink, spoke with Lindsay Konzak, editor, about why 40% of every business is unprofitable and how to fix it.
MDM: You write in your book about the Age of Precision Markets. What is the importance of this for managers?
Jonathan Byrnes:We were for decades and decades in what’s commonly called the Age of Mass Markets – from the early 1900s to about 20 years ago. The objective in most companies at a time when national markets were forming was to get economies of scale and drive costs down in mass production. The idea was to sell as widely as possible using mass distribution – the more volume you got the lower your cost and the higher your profit. The volume of revenues equaled profitability. Most customer relationships were arms-length. You dropped orders off at customers’ loading dock, and in that era distributors were simply part of the manufacturer’s outreach.
- Premium
- Premium
Industrial:
- Abrasives
- Adhesives & Sealants
- Metal Cutting Machine Tools
- Metal Forming Machine Tools
- Pumps, Compressors, & Eqmt
- Ind. Material Handling Eqmt
- Ind. Rubber Products, nec
- Ind. Safety Eqmt
- Metal Valves (not fluid power)
Construction:
- Softwood Lumber
- Hardwood Lumber
- General Millwork
- Gypsum Products
- Hardboard, Particlebd, Fiberbd
- Plywood
- Plastic Construction Products
- Wood Ties, Siding, Shingles, Shakes
Electrical:
- Electrical Machinery & Eqmt
- Electronic Components & Accs
- Integrating and Measuring Instruments
- Motors & Generators
- Wiring Devices
- Transformers & Power Regulators
- Switchgear, Switchboard, etc. Eqmt
- Communications & Related Eqmt
- Electric Lamp Bulbs & Parts
Power Transmission/Bearing
- Mechanical Power Transmission Eqmt
- Ball & Roller Bearings
- Plain Bearings & Bushings
- Speed Changers, Drives & Gears
Fluid Power
- Fluid Power Eqmt
- Fluid Power Valves
Plastics
- Plastic Resins & Materials
Fasteners
- Nuts, Bolts, Screws, Rivets, Washers (overall)
- Aircraft Fasteners
- Externally Threaded Fasteners
- Internally Threaded Fasteners
- Nonthreaded Metal Fasteners
Hardware
- Hardware (overall)
- Builders’ Hardware
Tools
- Cutting Tools & Accs (overall)
- Hand & Edge Tools
- Power-Driven Hand Tools
- Precision Measuring Tools
- Small Cutting Tools
- Tools, Dies, Jigs, Molds, Fixtures
Gases/Welding
- Industrial Gases
- Welding Machinery/Equipment
Jan-San
- Sanitary Paper Products
- Spec. Cleaning, Polish & Sanitary Products
Packaging
- Boxes
- Label/Wrapper Printing for Packaging
- Packaging & Ind. Converting Paper
- Packaging Products from Plastic
HVAC/Plumbing
- Air Cond. & Refrigeration Eqmt
- Heating Eqmt
- Plumbing Fixtures & Fittings
- Premium
- Premium
- Premium
- Premium
On average, respondents to the latest quarterly MDM/Baird survey said third-quarter revenues were up 6 percent.
- Premium
Jonathan Byrnes, senior lecturer at MIT and author of new book Islands of Profit in a Sea of Red Ink, spoke with Lindsay Konzak, editor, about why 40% of every business is unprofitable and how to fix it.
MDM: You write in your book about the Age of Precision Markets. What is the importance of this for managers?
Jonathan Byrnes:We were for decades and decades in what’s commonly called the Age of Mass Markets – from the early 1900s to about 20 years ago. The objective in most companies at a time when national markets were forming was to get economies of scale and drive costs down in mass production. The idea was to sell as widely as possible using mass distribution – the more volume you got the lower your cost and the higher your profit. The volume of revenues equaled profitability. Most customer relationships were arms-length. You dropped orders off at customers’ loading dock, and in that era distributors were simply part of the manufacturer’s outreach.
- Premium
- Premium
Industrial:
- Abrasives
- Adhesives & Sealants
- Metal Cutting Machine Tools
- Metal Forming Machine Tools
- Pumps, Compressors, & Eqmt
- Ind. Material Handling Eqmt
- Ind. Rubber Products, nec
- Ind. Safety Eqmt
- Metal Valves (not fluid power)
Construction:
- Softwood Lumber
- Hardwood Lumber
- General Millwork
- Gypsum Products
- Hardboard, Particlebd, Fiberbd
- Plywood
- Plastic Construction Products
- Wood Ties, Siding, Shingles, Shakes
Electrical:
- Electrical Machinery & Eqmt
- Electronic Components & Accs
- Integrating and Measuring Instruments
- Motors & Generators
- Wiring Devices
- Transformers & Power Regulators
- Switchgear, Switchboard, etc. Eqmt
- Communications & Related Eqmt
- Electric Lamp Bulbs & Parts
Power Transmission/Bearing
- Mechanical Power Transmission Eqmt
- Ball & Roller Bearings
- Plain Bearings & Bushings
- Speed Changers, Drives & Gears
Fluid Power
- Fluid Power Eqmt
- Fluid Power Valves
Plastics
- Plastic Resins & Materials
Fasteners
- Nuts, Bolts, Screws, Rivets, Washers (overall)
- Aircraft Fasteners
- Externally Threaded Fasteners
- Internally Threaded Fasteners
- Nonthreaded Metal Fasteners
Hardware
- Hardware (overall)
- Builders’ Hardware
Tools
- Cutting Tools & Accs (overall)
- Hand & Edge Tools
- Power-Driven Hand Tools
- Precision Measuring Tools
- Small Cutting Tools
- Tools, Dies, Jigs, Molds, Fixtures
Gases/Welding
- Industrial Gases
- Welding Machinery/Equipment
Jan-San
- Sanitary Paper Products
- Spec. Cleaning, Polish & Sanitary Products
Packaging
- Boxes
- Label/Wrapper Printing for Packaging
- Packaging & Ind. Converting Paper
- Packaging Products from Plastic
HVAC/Plumbing
- Air Cond. & Refrigeration Eqmt
- Heating Eqmt
- Plumbing Fixtures & Fittings
- Premium
- Premium
