|Question and Answer with Legend Power’s President Randy Buchamer
I have been with Legend Power for over four months. During this period we have made some significant changes and improvements to the business and I wanted to provide you with an update on our progress. The update is in a question and answer format and based on questions that I am asked most frequently. I hope that you can appreciate the progress that we have made over the last few months.
What has the Legend Team been doing over the past 3-4 months?
- Operational Excellence. The team completed a fundamental review of business operations achieving the following results:
- Reduced burned rate to $200K, a reduction of 50% from peak burn.
- Concentrated sales & marketing efforts, focusing primarily on Ontario
- Added a proven sales executive to the Ontario team to provide leadership and improve the sales process
- Reduced Product Cost. We conducted a review of how our product is manufactured and successfully:
- Reduced Product cost by 30%
- Reduced List retail price by 30%
- Increased gross margins
- Improved the Value Proposition. Previously, Legend Power was selling an energy saving technology and was unable to compete effectively in a highly competitive industry with the existing value proposition. Legend’s unique value proposition has been strengthened and now includes:
- An industry leading and unprecedented 10 year warranty
- A highly competitive ROI or payback
- The lowest cost of ownership in the energy conservation industry
- Sales Growth. Within 30 days of launching our new value proposition we received an order for five units from a large Canadian retailer. The sales funnel continues to grow as business development activities increase.
Why has it taken so long to sell Legend Power’s Voltage Optimization Solutions?
- Up until recently we were selling a unique technology when our customers were asking for an energy conservation solution. Our value proposition was heavily skewed towards a technical buyer and was not aligned with the end decision makers buying criteria.
- Our sales & marketing process was focused on qualifying a technical fit between a technology and a building. We were successful in getting to see prospects, but not at closing sales. We are now working towards identifying solutions for a business.
- We spent the last 3-4 months improving the product and sales & marketing process and launched a new value proposition in January 2011. The addition of Peter Hwang, a proven sales leader, to the Toronto team will help bring structure and leadership to the sales and marketing process resulting in a repeatable sales model and greater control of the sales funnel.
What are Legends Plans for the next three quarters?
- We are working towards becoming a world leading sales organization. We will continue to develop our sales & marketing processes with the end goal of controlling our sales funnel and projecting revenue with accuracy and consistency. We will achieve consistent and repeatable sales – this is the primary objective of Peter Hwang.
- We will prove our business model and sales process in Ontario. Once this proof of concept is complete we will begin to expand into other North American markets with similar attributes to Ontario, using a business model that is proven. We expect this to result in sustained growth for Legend Power as we expand into new territories
- Efforts to reduce costs and add value to our core product will continue. Reducing costs and increasing margin will remain a priority.
What does your IR Plan Include?
- Our Investor Relations communications plan was reviewed and improved during our review of business operations. During that time communication was limited; however, we are implementing a communications plan that will keep the investment community informed and regularly updated. This will include:
- An updated website
- Consistent relevant news releases and other communication pieces
- Targeted media coverage
- A dedicated in-house Investor Relations Administrator
Thank you again for your trust and support:
President & COO