The Apprentice Mess

I wouldn't normally write about a particular episode of The Apprentice but after years of watching the show, last night I was shocked by the lack of business sense in the how the winning team were picked, based on alone sales rather than profit. The whole premiss of the programme was flawed, that the best team wins and the losers are sent to the greasy spoon to await their fate.

The two teams were given the task of coming up with a fitness idea that could be sold as franchise to gyms and fitness centres. Once they came up with their idea and made a DVD of the concept they pitched the idea to three big players in the market. Basically what happened is the winning team in this weeks show gave away free gym equipment in the form of Space hoppers, hula hoops and skipping ropes without the cost of the equipment being taken off the sales figures to get actual the profit they would have made. This disadvantaged the other team who would have made a higher profit if these costs had have been included in the calculations.

The winning team made a basic business mistake about costs. After their first pitch where they were asked about equipment costs they at first made up the figures. Realising they didn't have a clue they then decided they would include the equipment for free in future pitches. They didn't even think of how this would affect the cost or their profit. Their whole business model was flawed and they should have been punished for it. They won on their third pitch that when Virgin Active said they would buy into their idea bring implement it in one hundred and twenty two clubs. The fact is the equipment costs would have really cut badly into their profits at the price they were offered.

When it came to the boardroom, Lord Sugar pointed out their mistake but he failed impose a penalty on the money they made through sales to allow for it. By letting the team win he rewarded them for their incompetence and he sent the wrong message to the business world that he campions in the show.  Surely he doesn't want people that can't work out basic cost to work for him or be in business with him.

When I posted about the start of the series five weeks ago I said "You can just see it the show being aired on prime time Chinese State Television as an example of how not to do business" what I didn't realise was that it really could be the case after tonights show. The thing is, they won't just be laughing at the contestants. What was Lord Sugar thinking of when he let this one go.