Underperforming Companies

Successful companies are characterized as those with visionary leadership, a sound business model, focused management and the ability and resources to maintain or increase financial performance, even during periods of economic contraction as we are now experiencing in the U.S.

Underperforming companies, although they may still be marginally profitable and solvent, do not perform at this same level. The expansion of the U.S. economy over the past decade, fueled by  low inflation, declining raw material costs, low interest rates, increasing productivity and strong consumer spending, has benefited most companies.  

However, as costs increase and U.S. economic growth slows, many companies are experiencing increasingly serious operational and financial problems, especially those that are unable to increase prices to recover higher costs coupled with falling demand for their products or services. For most underperforming companies, these problems are not self-correcting and, if unchecked, will seriously erode financial performance and lead to more serious problems.