Times are tough, no matter what size a business is. Start-ups and corporate giants alike are struggling to stay afloat long enough for business to pick up again. These companies have bucked the downward trend: they grew a profit, despite the bad economic climate. Here are six companies that survived the recession, and the secret to their success.
It all started in a garage, like so many large corporations we know today. Amazon's founder Jeff Bezos believed the internet could meet consumers' needs in a unique way, and began shipping books to customers worldwide in 1995. His vision proved to be profitable, as Amazon has grown to the place to go for online shopping; the company grew sales by 28% in 2009, a tough year of deep dips in sales for most businesses.
The company's secret? Focus on the long term: Amazon looks to innovate with products like its new Kindle 3, and strives to expand market share, forever anticipating the next change.
Just years ago, Ford was in deep financial trouble, along with the entire American car industry. Plagued by recalls, safety issues and lagging sales, Ford was looking like it was on its way out - until CEO Alan Mulally took over. It took three years of losses, rigorous cuts in jobs and costs, but Ford is now posting a $2.7 billion net income for 2009, and recently announced 2010 second quarter profits for April through June of $2.6 billion.
The company expects to end 2011 with less debt than cash - quite a turnaround in just a few years. A complete overhaul, eliminating models from its line, cutting costs and revamping its image got Ford back into the game at a time when recovery is toughest.
It's not easy to admit your product stinks on national TV, but Domino's Pizza did just that. Sparked by a consumer survey (with video clips on TV), the pizza overhauled its recipe, proving that change is good for business. Under the new campaign and new recipe, profit more than doubled in the fourth quarter of 2009, increasing sales for that quarter by $23.6 million.
The secret to Domino's turnaround was novelty: changing the self-proclaimed cardboard crust and ketchup sauce to a new, improved pizza brought people in the door. Time will tell if Domino's can keep these new customers, but for now, the pizza giant has turned this remake into a financial success.
It's been called a robe you put on backwards by Jay Leno, and parodied all over TV, but the Snuggie was undoubtedly last Christmas' hit. This blanket with sleeves was snagged up by 20 million people during 2009, and while exact sales numbers are hard to come by, this novelty has turned out to be a recession hit. Why? The one thing we all did a lot in 2009 to save money was stay home, curled up on the couch - just like the Snuggie commercial. The Snuggie is proof that novelty, the right price point and timing can translate into big bucks.
"What goes down must come up" seems to be the secret to Intel's recent $2.89 billion profit, which came in much higher than expected. Intel sat tight during the recession while client companies held off on computer purchases for their employees, and is now seeing the upswing, with profits soaring to a 10-year high. Intel's secret to success is simple patience: by waiting for pent-up demand to return, it's back to making the big tech bucks.
Last year was a tough year for toy companies - except for Lego. During 2009, when most companies were holding tight to ride out the recession storm, Lego's profits soared 63%. Exploration of the global market was the key to this company's recession-bucking success. While the U.S. had a stagnant toy market, Lego was able to expand to Asia and increase its sales in Europe, bringing in the big bucks. For a recent surprise addition to Lego's profit: after a recent interview where British soccer star David Beckham admitted he was building a Lego Taj Mahal during his down time, sales soared 663% - proof that sometimes free celebrity endorsement is the best profit boost of all.
The Bottom Line
If the recession has proven anything, it's that even corporate giants have to think outside the box to stay afloat. These companies show that with patience, innovation and occasional brutal change, you can beat a recession and come away with a profit even during the roughest of times. Of course a little help from a famous soccer star doesn't hurt either.