Precondition of a successful business is its capacity to generate revenue with satisfactory profit margin; revenue depends on customers’ base as well as their product preference. A solid and sustainable customer base can create huge demand of product and also can refer the product to external parties. Repetitive customers’ response is required for the above mechanism. On the other hand, unstable customer means no customers. An unstable customers’ base cannot ensure demand of product of the company. Customers’ base may have diversity in the form of age, geography, habit, etc. Now a day, enterprises are expanding beyond national boundary -towards international consumers. What about the customers’ base, business diversity and geographical presence of MusclePharm (OTCQB: MSLP)? According to Brad Pyatt, Chief Executive officer of MusclePharm Corporation (vide a newsletter on February 15, 2013), “our core marketing strategy is to brand MusclePharm as the "must have" fitness brand for workout enthusiasts and elite athletes. We seek to be known as the "athlete's company," run by athletes who create their products for other athletes, both professional and otherwise. We believe that our marketing mix of endorsers, sponsorships and providing sample products for our retail resellers to use is an optimal strategy to increase sales. Increase our product distribution and sales through increased market penetrations both domestically and internationally”. He has added that the products of MusclePharm are currently sold in over 110 countries, with the goal of reaching 175 countries in the next few years. He also include that the product of MusclePharm are available in over 10,500 US retail outlets with the goal of reaching 20,000+ in the next few years.
The company’s above forward looking statement assures that it has good scope of business expansion followed by market demand. However, the important issue is that ‘making expansion with satisfactory profit’. Albeit the company has indicated to achieve a good result from its first quarter’s sale in 2013, what does actual mean by this? Less loss or some profit from operation?