Turnarounds

Transferred to Jackson, Mississippi where sales and profit were among the worst in the country, racial tensions within team were high, prior leadership had created animosity and teamwork and cooperation were nearly non-existent. Turned around underperforming state for Radio Shack, increasing average volume 34% in Y1, 14% in Y2 and 10% in Y3, while improving highest ticket and average ticket sales proportionately.

Results were being significantly depressed by bottom 10% District Managers. Held frank conversations with DMs ensuring they knew ranking and changes needed regarding customer count/# of visits/rentals per visit/avg. rental fee. Established performance improvement program, turning around underperforming districts and winning Zone/Area of the Year companywide for best revenue and profit results.

Tasked with turning around a declining Franchise system and get it growing again. Implemented direct mail and phone solicitation to top 100 independent video operators for conversion to Franchisees, advertising in major Franchisee publications for fast-food Franchisees to enter video. Turned around declining Blockbuster Franchise system, converting 43 independent locations, opening 154 new locations, capturing $5M upfront franchise fees and growing revenues to $900M with 20-40% increase Y2.

Downsizing/Rightsizing/Restructuring

Costly, ineffective and antiquated communication/records system complicated company’s ability to hold Franchisees accountable for compliance with marketing, operating standards, reporting and financial obligations from multiple Franchise Agreements with widely disparate terms. Updated Blockbuster Franchisee’s communications process/records system, saving $1.8M in costs and creating instant access to agreements that resolved Franchisee disputes and favorably resolved a $7M lawsuit.

Armed forces were deployed for Operation Iraqi Freedom (OIF), meaning that vast majority of customers just went away – leaving sales associates unable to make quotas/paychecks. Established/implemented program to salvage Pioneer Services’ business endangered by war in Iraq, doubling business referrals (from 6% to 13%) by dealers/merchants and creating 2nd strongest source of new customers.

Three regions needed downsizing/rightsizing, eliminating leadership/support staff for regions generating ~$100M annually. Downsized/right-sized regions, saving company $500K annually while enhancing company’s reputation.

Growth Strategies

Company wanted to create immediate cash-flow through the sale of Company-owned locations to Franchisees, but Franchisees were reluctant to expand or purchase stores as heightened competition and advent of “Revenue Sharing” as a means of purchasing product had impacted profitability significantly. Spearheaded sales to Franchisees in market downturn, generating $60M+ in cash flow and $3M Franchise fees in less than one year, as well as creating 8% in annual residual revenues for Blockbuster.

Manager ranked in Top 5 for highest volume location in territory believed that the operation was top notch and was generating more revenue than should be capable of being produced in that store. Reenergized high-ranking Radio Shack store, exceeding record $4K per day, increasing Y/Y volume 40% and promoting Manager and three sales associates for outstanding performance.

Took over new territory and was asked to meet with manager of highest volume location in the state who had opposed predecessor and determine if he should be terminated on the spot. Salvaged from termination and directed recalcitrant Radio Shack manager to #1 leader $/ticket nationwide, doubling national Avg.$/Ticket for location and growing sales 45% in year one.

Assumed leadership of territory with outstanding results and people and was challenged to grow business. Drove well-producing territory to #4 of 200+, winning awards for >25% sales/15% profit growth and double digit growth in subsequent three years, maximizing sales with excess from other store inventories.

Sales Strategies

Two major competitors announced entry into DFW market. Video Update’s press release announced plans to open 60 DFW locations and a second competitor promised to open 100 stores. Beat out aggressive competition, exceeding 40% market penetration in Dallas for Blockbuster.

Problem Resolutions

Franchisees were stalling for time, demanding greater documentation and refusing to pay balances while delinquent A/R grew to $19M. Drove aggressive collection/resolution process for Blockbuster A/R, recouping $19M from Franchisees, creating on-time payment culture and losing only one small Franchisee in four years.

Took over territory with plans for rapid growth and development, but candidates were in short supply to fill new management positions while existing management staff needed to be upgraded. Hired new and upgraded existing staff in rapid-growth territory, reducing recruiting time by 30%, reducing recruiting costs $18K with highly qualified candidates and increasing revenue 35% in Y1.

New Franchisee acquired twelve locations and filed $7M lawsuit alleging that an accounting change in inventory over-inflated the price paid for stores and that overpayment should be multiplied by five times earnings. Franchisee stopped paying ongoing fees. Avoided litigation during deposition, preventing three suits at $42M and collecting $300K in past due fees.

Military families are often buried in revolving debt and have no idea of horrific interest and fees they are assessed. Led program saving $100M annually in fees/interest paid by military families while increasing net to lenders.

Acquisitions / Negotiations

Located and identified a potential acquisition in East Texas. Responsible for determining valuation of competitor inventory, and projecting future revenue, profit, market expansion, renovation costs, impact on existing locations, while negotiating clearance from a BB Franchisee operating several stores in the market and giving a go/no go to financial and legal teams. Located and negotiated new BB acquisition, saving $15K costs per unit, 15% in rent and $30K in product cost per location, gaining $1.6M in cash for location swap and growing revenue 21% in Y1, 10% in Y2 and 7% in Y3.


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