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NEW YORK (AP) â¿¿ One of the most painful moments small business owners can face is when they realize: It's not working.
It could be a product that's not succeeding, business that's taken away by a competitor, or changes in the economy that threaten a company's survival.
When something has gone awry and sales are taking a hit, company owners have to make big changes to turn things around â¿¿ and they usually can't afford to waste time. Large companies often have enough revenue coming in from a variety of products and services that they can weather a problem in one area of their business. Smaller companies typically don't have that cushion.
Reinventing a company, large or small, is not an easy task and it can't be done overnight, but many business owners have been able to pull it off.
ALMOST SOCKED BY OVERSEAS COMPETITION
Cabot Hosiery Mills had great success its first 20 years, making what are called private label socks for retailing chains. It only made socks that carried the names of the stores that sold them such as J.C. Penney and Gap.
But in 2000, sales began falling as stores began buying cheaper socks from Chinese vendors, says Ric Cabot, co-owner and son of the company's founder.
"We weren't paying as close attention to our financial indicators as we should have," he says.
By 2003, sales were down by more than half. Cabot was forced to cut his staff of 70 down to 30.
"We needed to create a product that would basically save us," he says.
Cabot didn't have to look far to find a market niche his company could fill. An avid hiker who is also active in several sports, he had a hard time finding high-quality socks for those activities. And he knew how to make socks that were comfortable and durable.