Organizational ABCs

Abstract

Consider, if you will, a Third-Party Reverse Logistics (3PRL) firm that provides apparel and home goods processing services for multiple large retail companies across the United States. This firm (“ABC 3PRL” or simply “ABC”) was founded over 30 years ago and is still owned and operated by the same individual, Mr. Remo Williams. ABC operations cover a small physical footprint with three facilities spread across a four-mile-span in the northeast approximately one hour west of Manhattan. This proximity presents a distinct advantage for ABC because many of their customers have offices in or near Manhattan’s Garment District. ABC also maintains a close relationship with its suppliers, primarily regarding temporary labor. This portion of the workforce composes over 90 percent of the entire labor pool. The firm operated successfully (as assessed by profit and Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)) until the first quarter of 2017. The owner and President, Remo, maintains close personal and professional contacts with key decision makers in the home goods and apparel industries, and this competitive advantage requires a majority of his time and effort on a daily basis. The combination of these issues, the absence of a management structure and supporting management systems, along with a multitude of additional issues, presents a host of challenges for ABC. These challenges may drive the company out of the market or out of existence altogether, but they provide ABC the opportunity to examine their business and to apply and benefit from best practices in organizational management.