StepSmart Fitness Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Financial Analysis

Key Issues

StepSmart Fitness though had different product line which included different products such as Cardio machine, strength technology and other small equipment. Though the company was selling its products to different districts, but the issue was that the company was not achieving its targeted goals. Such as in the case of Cardio machines, the forecasted sales for 1^st half, 2012, was estimated to be $43,538,310, but the actual sales recorded for 1^st half, 2012, was$43,449,600. Hence, the sales of the cardio machines fell short of $88,710. This could be due to different issues like low performance from the sales teams or they were not supposed to convince the clients. Similarly, for the strength machines, the forecasted sales for the 1^st half in year 2012, was estimated at $24,354,000, but the actual sales for the 1^st half, 2012, was recorded as $22,450,000. Thus, the company fell short of $1,904,000. These figures showed that the company was not able to achieve the desired results regarding these products (Exhibit 1)

According to the data, Avery had a share of $159,319, in the sales of cardio product. It was the lowest as compared to other sales person. Likewise, Concetta had a lower share in sales as well, which was calculated as $ 324,329. This shows the poor performance of the sales team from New England that caused the overall sales of Cardio to drop. Whereas, taking into account the strength product, it also failed to achieve the sale as forecasted. Considering the sales team of New England, again the Avery and Concetta were the top lowest performers in terms of sales. Avery was successful to attain only the share of $165,958. That's also reflected the low performance by Avery. Similarly, in the case of Concetta, she was not able toachieve high share in the sales of Strength products. Her contribution towards the sale of Strength products was estimated to be around $213,374. This was a quite low share as this also caused the decline in sales of strength product. Whereas, Avery and Concetta were again on top of the list for incurring the most expenses, but their share in sales was the lowest (Exhibit 2)

Action Plan

The company had many issues regarding the performance of the sales team and achieving the targeted sales. Therefore, there were different options such as the duties of sales team should be rearranged according to their performances and also there should be changes made in the compensation program and limitations on the expenses. According to the performance of Avery and Concetta, in terms of sales, company should take initiatives in giving them the training for increasing the sales of cardio and strength products. They were the low performers as compared to other ones. Whereas, Ellis, was the best in sales therefore, he should be given opportunity to guide and monitor the weekly activities of Avery and Concetta. This task didn’t require too much travelling. Gibbons was also supposed to be given professional training for increasing sales in cardio product, as his performance in terms of quantitative data was low as well. Similarly, the expenses of the sales team should be limited and if that limit was crossed then salesperson would have been liable to bear those additional charges himself. In this way the productivity of slow performers would increase as well the percentage of sales......................................

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