Had a talk with one of the principals the other day. He acknowledged that vacating the sales reps wasn't one of their better moves. That is being reversed and 70 had already been hired and another 35 or so will be by Wednesday(for offices doing 25K or more weekly).
Mike, that's pretty consistent w/ my understanding as well.
I also asked about mass departures. He said there were more departures than they would like but turnover has always been a problem. They are trying to address that problem by better hiring and training. The veteran branch managers (four and five year experience) are not leaving in mass as has been suggested on this thread. They make very good money and are generally content.
At the annual meeting, GW was asked by one shareholder in attendance as to what he viewed as the three biggest challenges facing LRW going forward. The only and only answer that GW gave was the need to continue improving its processes of recruiting, training, and retaining good staff.
Talking w/ one of the LRW mgmt. team right after the meeting wrapped, I was told that when the news of DD departing came out, GW received several, several calls from good people who had left under DD's watch, wanting to come back to LRW. And while GW wasn't bringing those folks back into the fold, he himself was calling a few people that he knew he wanted back w/ the co.
Looking at the #'s from last quarter, there's no way one could categorize the quarter as a bad one, because the co. still did very well, beating the Street's estimate by a penny. But that GW is fully aware of areas that could use improvement and is attacking him quickly and decisively is a major, major positive step in the right direction; a step that I think will be reflected in the 3Q99 results.
Any complaints about building offices on top of offices are made by employees who don't understand the nature of the business. An office's circle of influence is approximately a 5-10 mile radius. Other offices lend to greater area presence which allows them to more readily fill requirements (filling labor shortage from one office with another) and is instrumental in plumb opportunities like the Super Bowl contract in Dade County....
Exactly, Mike, exactly. And if I could clarify something you say here, I'd like to. When you speak of a 5-10 mile radius, you are talking about in a highly industrialized and/or highly populated area, no? This would not be the case in a smaller community that LRW serves, as one or two stores might be adequate.
That one such as Seuss does attack such a stmt., it speaks volumes as to how little he truly understands LRW's business model and why it has been so successful, allowing the co. to grow as fast as it has.
This stock is trading at about 18-19 times this year's earnings and seems pretty cheap at current growth rate.
Extremely cheap, IMO.
Take care - K. |
