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Costs Threaten Business Model
[NOTE: Because of our strict NDAs protecting our clients, these cases do not include identity indicia. We never post a client situation that can strictly identify them or could adversely affect them.]

Client Situation

Supply chain costs created an unsustainable business model, threatening ongoing operations of a business unit within a Fortune 500 professional information and analysis publisher.

Our client provides extremely valuable and proprietary federal and state legislative data and analysis online.

Their customers access that information online and on demand.

Due to non-negotiable licensing agreements from our client’s raw data supplier, large-scale analysis was charged on an hourly basis for access — and at many hundreds of dollars per hour.

This was an outdated model that forced access costs into the stratosphere.

While their customers required the data, they were unwilling and often unable to spend the exorbitant rates for the access time. Our client’s service usage languished, as did revenue. Growth was negative and headed for a reverse hockey stick.

Our client was up against the wall: a valuable, much-needed product, being choked nearly to death by its irreplaceable supplier costs.

How We Addressed This Critical Challenge

With an impossible business model, the only way to rescue this company’s unit was to change the way clients could access the information without violating the supplier’s licensing terms.

We quickly innovated a unique way for our client’s customers to technically “package” their legislative inquiries, and using some simple software quickly connect with the supplier’s system at computer-to-computer, rather than human-to-computer speed.

In this way, our clients’ customer’s work could then be completed in a tiny fraction of the previously required time.

Client Success

This resulted in a rather different business model.

For our client, while the amount of per-transaction time by their customers decreased, the aggregate number of transactions skyrocketed.

At the much lower cost for research, users frequently accessed the information.

Revenue increased in a startup-like proper hockey stick growth pattern.

Referrals became common, and multitudes of new customers subscribed to the service. Revenue generated grew massively and the system became the standard for the industry.

When we address client’s highly-threatening situations, a small change in the business model is often all it takes to go from an imminent disaster to true and sustainable success.

We retain the incredibly kind thank you letter from our client on our wall as a constant reminder of the value of addressing critical situations. Perhaps we can help you as well.

Questions? Please contact us.

Costs Threaten Business Model

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