Discussion Post
Assume that you are a consultant for a start-up internet retailer, Bikers.com. This company provides a variety of bicycle parts and accessories in a convenient and effective customer service approach. The firm operates from an office building and a nearby warehouse located in Danville, Virginia. Currently, the firm has 10 permanent administrative staff, 6 customer service representatives who respond to customer inquires; and 12 employees who pick, pack, and ship customer orders. All orders are placed on the firm's website. A toll-free telephone number is available for customer service. The firm's sales increased at about 20% per year in the last two years, a decline from the 50% rate in its first three years of operation. Management is concerned that the decline will delay the firm's first expected profit, which had been projected to occur in the next two years. The firm is privately held and has been financed with a combination of bank loans, personal investments of top managers, and venture capital funding.
For your initial post, discuss what specific executional cost drivers are important in this business? How should the firm use them to improve its sales rate? Provide any references used to support your answer.