As I have started almost all the posts in this series on focus, … focus matters. Pursuing top line growth to impress Wall Street usually fails as the top line grows (if it does), while the bottom shrinks, or at least profit margins do. The power of focus is irrefutable.
And here yet is another example: Leprino Foods. What is their focus: mozzarella cheese for large pizza chains. They are in fact the world’s largest producer of pizza cheese. A billion pounds a year of mozzarella. They have 85% market share and profit margins that are much better than most dairy industry companies. All thru relentless focus.
The company has four key values: quality (they have never had a recall which only a handful of dairy companies can say); service; price (40% of the cost of a pizza is in the cheese); ethics. Their absolute focus on mozzarella for pizza allows them to innovate (they have over 50 patents) and know how to help their customers so selling is “easy.”
They make more money than others, have billions in revenue and a laser focus. Meanwhile “smarter’ companies keep looking to diversify, and meanwhile don’t make money.