Avoid past mistakes
Hultgren’s refocusing of the company has paid off. Today,
SWS is coming off of fiscal 2007 revenue of $470 million with
net income of $37 million.
He can now turn his focus to growing the company rather
than fixing it, and one way he’s doing that is preparing for
tough times.
With any business that’s directly tied to the stock market, business fluctuates. Hultgren, who added the title of president in 2007,
likes to be prepared for the downturns to keep the company on a
more even keel. In fact, preparing for the business’s rainy days can
be a key growth strategy.
“The strategy is that in a downturn, you want to be one of the
firms that still has money left,” Hultgren says. “You want to go
out and accumulate either acquisitions or producers. When we
first started this, we were in a bear market, and I kept telling
everyone we were going to buy straw hats in the wintertime. A
bear market is a good time to expand your firm if you can
afford to do it.”
In fact, Hultgren sees 2008 as a potential bear year, and he’s
preparing for that by looking for acquisitions. The company has
announced one acquisition as a means of growth and wants to
do more.
“You want to have liquidity,” Hultgren says. “You don’t want to
have too much or it affects returns. You want to be there with the
checkbook when times are rough.”
He says a good business opportunity has to fall within the
core business and its values. Don’t be tempted to go outside of
that. It won’t pay off.
“I told you we made a decision to specifically stop talking
about a particular business, and the very next week, someone
called me up with a business that was for sale in that area,”
Hultgren says. “I was able to say, ‘No, thanks.’ No way. I don’t
care how good it was; I wasn’t going to swing at that pitch.”
Hultgren feels good about where the company is now. He
sees the company as poised to grow and prosper.
“We have done the things we needed to do to get the efficiencies in the company, and we are just now beginning to
accelerate using the new platform,” Hultgren says. “Today, the
focus is all about growth, as opposed to all about saving
money.”
HOW TO REACH: SWS Group Inc., www.swst.com or (214) 859-1800