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New alliances and a
record Quarter are creating excitement for Park City Group
Technology
Software and Programming
(PKCY-OTC: BB)
Park City Group, Inc.
333 Main Street
PO Box
5000
Park City, UT 84060
Phone: 435-649-2221
Randall Fields
Chairman and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
December 15, 2005
BIO:
Randall K. Fields
____________________________________________________
Personal Biography
Randall K. (Randy) Fields is Chairman, and CEO of Park City Group, Inc. a
technology development and consulting services company based in Park City, Utah.
Delivering software solutions to the retail market, the company has customers that are
recognized retail leaders both domestically and internationally, such as The Home Depot, Victoria’s
Secret, Williams-Sonoma, The Limited, Tesco Lotus and Anheuser Busch Entertainment. Fields
career reflects his strong entrepreneurial skills. Initially leveraging his educational
experience, in the early 1970’s, Fields established a financial and economic
consulting firm called Fields Investment Group. He then co-founded Mrs. Fields Cookies
with Debbi Fields, and served as its chairman from 1978 to 1990. Known for the innovative
use of technology to operate the business as it grew, Fields and the Mrs. Fields Cookie
operation were featured in a Harvard Case study that is still used and referenced in
business schools today. Fields demonstrated his skills in international business
development as the Mrs. Fields brand expanded to more than 800 locations. His knowledge
and creativity in product branding led to the development of the unique branding
characteristics for the newly emerging sweet treat market. Based on the acclaim
surrounding the Mrs. Fields Cookies business, Fields’ use of technology in operating
business environments, and the effectiveness of the software in producing benefits and
results.
He founded Park City Group in
1990 and expanded his entrepreneurial skills with the co-founding of Captiva Software,
today a $50 million company listed on NASDAQ. Randy and Debbi co-founded the Mrs. Fields
Children’s Health Foundation and served as Directors for several charitable
institutions, including the Primary Children’s Hospital and the LDS Hospital in Salt
Lake City. He is a contributing editor to Chief Executive Magazine, and has written
extensively on the subject of using technology to solve business challenges. Articles
regarding Fields’ concepts, companies and products have been featured in business
publications such as Forbes, Business Week, INC Magazine, The Wall Street Journal,
Management Review as well as computer and trade magazines including Computerworld,
Information Week, PC Week, Network World, Datamation, RIS News and Chain Store Age
Executive.
Fields holds both bachelor and
masters degrees from Stanford University, where he was a Phi Beta Kappa, Danforth Fellow
and National Science Foundation Fellow. Today, Fields shares his expertise and the
collective experience through consulting and speaking, interviews and guest lecturing
engagements both in the retail industry as well as in the general business environment.
Company Profile:
Park City Group, Inc. founded in 1990, develops and markets patented end-to-end computer
software solutions that help its retail customers to increase their sales while reducing
their inventory and labor costs: the two largest, controllable expenses in the retail
industry.
The technology has its genesis in the operations of Mrs. Fields Cookies, co- founded by
Randy Fields, CEO of Park City Group, Inc. delivers comprehensive software solutions for
retail operations to its impressive, and continually growing, user base. Customers are
rapidly deploying and licensing additional software for their multi-location businesses.
Park City Group, Inc., (OTCBB:PKCY, Berlin: WKN# 924919), headquartered in Park City, Utah,
became a public company in May, 2001, and began expanding its market share within the
grocery and specialty retail sectors. By uniquely leveraging its expertise in retail
operations management, and state-of-the-art patented technologies, the Company facilitates
the planning and execution of complex business processes. In addition, it delivers timely,
relevant, and "actionable" information. Park City Group helps improve its
customers' profitability by putting the "best manager" in every store. The
Company uses a customer-centric focus by measuring its success by the success of its
customers.
Fresh Market Manager and ActionManager at Work:
The Company is gaining recognition within the supermarket/grocery segment for its Fresh
Market Manager applications which are a fully integrated management solution for bakery,
deli, food service, meat, seafood, frozen, floral and produce departments. Fresh Market
Manager delivers cost savings and increases sales, enabling grocery chains to survive the
fierce competition created by value retailers. The product helps grocers to achieve
improved economic performance.
Together with its ActionManager solutions, Park City Group delivers one of the most robust
integrated business solutions available in the industry. The systems address operations
management tasks, including: item level category management, inventory and production
planning, work flow, scheduling, forecasting, interviewing applicants, generating supply
orders, producing sales reports/projections, administering skill tests transmitting, and
assessing employee knowledge. Until recently, the Company has focused on the domestic
retail market, and is now positioning itself for international market penetration with its
patent pending quick switch language support.
Technology
Strategy:
Park City Group's Research and Development organization adheres to a strategy that
leverages the key technology requirements while supporting existing technical
environments. The company believes that just using the latest and greatest technology is
not good enough when it comes to developing innovative software. It takes:
· Commitment to an
"open" environment
· Use of tools to allow for simplified tailoring
· Maximum flexibility to support all types of communications
· Architecture that supports consistent, reusable, development tools
· Adaptation to changing business requirements/emerging technologies
· Support of low bandwidth communication and high speed environments
· Combining environments in today's complex, multi-location operations
CEOCFO: Mr. Fields, our readers were introduced to Park City
Group in July and a lot has happened since then; what is going on with Park city today?
Mr. Fields: “We’ve recently reported a record
quarter with our net income exceeded $2 million on revenues that were nearly as much as
last years entire revenues. Therefore, one doesn’t have to be a rocket scientist to
figure out that we are headed for a very good year. Having said that, the nature of what
we do is what Wall Street refer to as ‘lumpy’, so the truth of the mater is that
the next couple of quarters is going to could be more comparable to the
kinds of quarters that we had last year. Then hopefully the 4th Quarter will be
once again a very strong quarter, but overall though for the year we are expecting a much,
much better year than we’ve seen and one I think that will please all of our
shareholders. In a nutshell, we’ve established several new alliances, including the
very important one with a large London Stock Exchange company called IMI Company (LSE:
IMI.L.)”
CEOCFO: Could you please elaborate on your relationship with
IMI?
Mr. Fields: “The IMI relationship is both very
interesting and important. It is interesting in the sense that increasingly our alliances
are with suppliers who provide products and services to the retail industry, which is our
preferred market. However, at the same time these alliances create for us a very effective
distribution channel, so in addition to selling their services, they in essence bundle
what they do, in this case, point-of-purchase and merchandising systems, with our data
analytics capability, to provide a very exciting solution for retailers. By virtue of the
fact that they are international and in tens of thousands of retail locations with their
point-of-purchase products, we are excited because IMI could in fact lead us to a large
number of retailers to use our technology.”
CEOCFO: Why did IMI chose to go with Park City?
Mr. Fields: “I would say that from an IMI perspective
they have been hoping to move beyond simply doing what they have historically done, which
is a kind of value added service as a merchandising system. In the last several years,
they have found that there are data rich opportunities to help retailers that really need
the help; to help them understand the needs of their customers’ better, to help
retailers get closer to what their customers want. This will enable them to display things
and merchandise things that their customers want to buy and do that in a way that is more
appealing and more attractive. Obviously, this would be done with the intent of increasing
retailers’ profitability. I think IMI was looking for that, ‘hey I’m from Missouri’
retailer solution, which is show me if you’re really improving my results. Our Data
Analytics and our Fresh Market Manager and our ScoreTracker products really help retailers
come to grips with, ‘am I more profitable at the item level, store-by-store,
day-by-day?’ Therefore, the business reality here is that by taking our Analytics and
attaching it to what they already do so successfully for retailers, I think IMI now has a
really powerful solution. Not being able to simply say to a retailer, ‘we can
increase your sales and profitability’, but demonstrate that they can increase sales
and profitability and measure it very precisely with our tools.”
CEOCFO: You’ve done some industry consulting; what are
the changes there?
Mr. Fields: “I think that the reality for us is that
over time we found that our customers as retailers and retailers in general, are looking
for more than simply, ship me the diskettes and help me with technology. It is an industry
that is very thin on management, that has over the past several years remained competitive
of Wal-Mart, has significantly reduced the size of their staffs, but the truth is that
they need people from the outside, who can bring expertise and help to enable them to be
more profitable than they have been. Therefore, what we found is a ready market for our
own retail expertise in helping retailers us our products and learn better from a hands on
user, which after all we were in Mrs. Field’s Cookies. Hands on user technology, how
do you use tools to drive and change the sales and profit mix business that as a retailer
you’ve been able to achieve.”
CEOCFO: You’ve gone out of the traditional retail
markets.
Mr. Fields: “Yes, we’ve done some work in financial
services; we are doing work now on the supplier side to retailers, so we’ve expanded
our retail offering to different channels of retail. I think that we are now having some
conversations with people who sell things that are not perishable. We are also having
conversations with people who provide products to the Do-It-Yourself (DIY) market. I think
that as we gain our footing here, we become more comfortable on this, our financial
position improves, and certainly, we’ve seen some dramatic changes in that in the
last few months. We are looking to expand the turf over which we roam.”
CEOCFO: Have you needed to add management to go into these
other areas?
Mr. Fields: “What we’ve done very significantly is
buttress our management staff; the professional services part of our business is by
definition the most rapidly growing. Six months ago, we added a key individual, Aaron
Prevo, as our Vice President of Professional Services, from an outside consulting firm,
KPMG or BearingPoint, as it has been called. Aaron’s responsibilities internally are
to manage that entire Professional Services organization and heaven knows that he is
qualified to drive the growth that we are looking for in that particular arena.”
CEOCFO: It appears that expansion is a major focus for you.
Mr. Fields: “I just keep expanding the business day from
24 hours to 48. The other big news is, and this is a commitment that we made to our
shareholders a couple of years ago, that we would over time not just focus on our
top-line, but focus on the balance sheet of the business. Therefore, what we did in the 1st
Quarter of this year is to essentially payoff all of the outside debt of the company;
outside meaning non-CEO debt. We paid off about $2.5 million debt in the last quarter and
that makes a very significant improvement to our balance sheet. From a risk profiling
perspective, this therefore puts us in a much better position. Hence, we are feeling much
more comfortable about our financial position. Now we should not be expecting the enormous
profitability of the last quarter for the next couple of quarters and there may not be a
repeat performance for a while, but I think that the next several years are looking
terrific from where we see them today.”
CEOCFO: How do you keep adapting?
Mr. Fields: “We tend to be very customer centric, more
than market centric, so as a result each time we take on a new customer they seem to add
to the depth of our offering and ask us for more. Therefore, I suspect that with the range
of customers that we will take on in the next 12 months, we are hoping to be the largest
number of new customers that we have ever brought in a single year. We are anticipating a
substantial expansion of what we are doing as a result of that and the truth of the matter
is that those customers are likely to lead us to new technology solutions that in turn get
sold back into that customer base. So I think that in the next 2 or 3 years should be
fairly exciting. I don’t want to start boasting, but it is fair to say that
internally, the entire management team is very excited about what our upside is looking
forward.”
CEOCFO: Are you as a company focusing more on alliances than
finding new customers?
Mr. Fields: “The way I would put it is to say that
alliances enable us to keep our sales and marketing costs lower than they otherwise would
be, by virtue of the fact that the alliances have as their financial interest, bringing us
into their customer set. What that means is that instead of having a large sales and
marketing organization and spending as most software companies do, 30 to 40% of their
revenue, on sales and marketing, our alliances have has
enabled us to spend a much smaller percentage on sales and marketing. That of course in
turn allows us to put more into customer service and into product development, which we
think drives the business forward. Therefore, it is a leveraged way for us to get better
distribution. Further, we are adding to the staff that in fact, works with our customers,
which in turn leads to additional same customer revenue as opposed to our alliances who
have their investment in generating new customer names for us. If you put those two ideas
together, it says that over the next year or two, our resources will be devoted to
providing superior service to our existing customers and to provide additional development
in our technology, which will provide additional income streams for us. As new products
come to market, we are going to rely on our alliances to generate leads and help us close
business, so that our customer list continues to grow. When you put those two things
together, given our financial position and resources over the next year or two, that is
almost certainly the right strategy.”
CEOCFO: It sounds like a win-win-win situation for you, your
partners and your customers.
Mr. Fields: “Certainly!”
CEOCFO: Finally, please address potential investors.
Why should they be interested?
Mr. Fields: “The first thing that I always want the
potential investor to do is to do his due diligence. We think that the more somebody
studies the business problem that we solve, specifically the competitive threat that
Wal-Mart is producing in the world of supermarkets, convenience stores and retail in
general; we are a great antidote for retailers to disvalue a Wal-Mart type threat.
Everyday you can pick-up a newspaper and see that one business or another is doing poorly
in relation to what Wal-Mart is doing. We give them a competitive set of tools that has
enabled them to differentiate themselves and become substantially more cost competitive
and profitability driven. Therefore, in a sense if you do your homework and an investor
were to look at our website, parkcitygroup.com, and the management team; the perspective
investor would be satisfied that we have the experience and lots of capability. In fact,
the management team owns a significant piece of the business, between myself and the rest
of the management team, we own roughly 60% of the company. When you add directors to that,
it is probably plus 70%. Therefore, I think the fact that as insiders we have a
significant investment in the company and we are excited about the opportunity;
shareholders can be certain that they have a driven executive team working on their
behalf.”
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