Starting a new business is never easy. One of the most difficult goals of any new startup is to turn a profit after growing and receiving investments. This is what Handy co-founders Oisin Hanrahan and Uma Duang found out. The two founders of the on demand online home cleaning site managed to steer Handy towards profitability despite making mistakes and economic challenges. Here are some of the things they did to make Handy more profitable.
Based out of New York City, Handy.com quickly discovered that paying employees in their customer service department would end up being very costly. The space to lease for calling centers in New York City would also end up being pricey. Umang Dua and Oisin Hanrahan made a difficult decision to relocate their calling center to cheaper venues in Florid and the Midwest. It was incredibly difficult and challenging say Oisin and Umang but the pair say they had to do it, as the costs for their customer service department were rising and rising. They were under pressure do cut costs and this was one way of doing it.
Another way that Handy has survived the on-demand bust is by focusing on the market segments that they were already present. Handy’s competitors wasted precious resources on entering more and more markets without really developing existing ones. This lead to a large expenditure of resources and no immediate returns on profitability. Eventually a company has to be able to turn a profit in its markets or it will go belly under. Coupled with scandal Handy’s competitors went out of business.
Handy managed to cut costs by outsourcing labor and focusing on developing its existing service infrastructure in the places it already had clients. This led to repeat clients and high satisfaction. Marketing costs have also been driven down and thus profitability has been increased even more.