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The economy may not be improving too much anytime soon, and so the brain of the business owner is on overload trying to figure out the next right moves. These are tough times. Staying alive with one's head above water is the goal.
But what to do? There are no simple answers, no quick fixes and not necessarily one right thing, but perhaps many smaller right things to do. The following is a list of ideas to consider your solid surface shop's situation. You might want to discuss these ideas with your accountant or employees to see what other ideas they can come up with to make a difference in your business. Sometimes it's not one idea or even anything new, but rather small changes that will improve your business and get it on a better track.
A is for Accounting. Bookkeeping is what you do every day — entering financial information into your software program. Accounting concerns the reports generated after bookkeeping is done. To me, the most important report is the general ledger (GL). It should tell you where your money is going, where it is coming from, and where you can save money, etc. If the GL is not specific enough, your chart of accounts needs to be adjusted in order to get the information you need. Ask your accountant for help. If you don't have an accountant, get a good one. Can't find one? Ask your distributor's accountant to recommend one.
B is for Basics. Find a quiet place. Maybe go for a ride in the country. Relax. Think about the reasons you started your business and your goals back then. Make a list of the things that worked best and what didn't, what you like best and what you might like to change. Then evaluate your findings. Sometimes going back to basics is as important, or more important than coming up with new ideas. Also, think about your greatest assets — your clients and ask yourself, "What can I do to get my clients to buy more product?" Do they need training, better information about availability and pricing, a better turnaround time? Do they understand that upselling improves their bottom line as well as yours?
B is also for Business. Most people start a business with thoughts of what they want to do and how they will do it, and they understand that they will learn as they go. After all, you are smart and have good judgment. But I came to realize that what you don't know upfront will cost you dearly later on. Education in any areas of business is a good thing.
C is for Customers. The most important commodity any business has is its customers. If your customers are wholesale, you might consider new ways, or better ways, to work together for your mutual benefits. Call them personally to see how things are going and how you might partner with them for future success. You might come up with a "special package deal" on coved backsplashes; let's say, maybe a quicker turnaround time (only with advance booking), or some other benefit you can think of. If you have a CNC, you could offer a special on an inlay in a counter or splash. Discuss upgrades. After all, this is where the profits are hiding. If your customers are retail, get out the old contracts, review them, and call each client and ask how they are, how they like their countertop and find out if they need any additional work. Ask about their children. Second- and third-generation customers are not only a terrific possibility, but also a segment that is developed by others every day.
D is for Downsizing. Downsizing isn't always an easy thing to do, but maybe now is the time, or when your lease is up. Figure out how your business can become leaner and smaller, and still maintain the profit margins you are accustomed to, or would like to become accustomed to.
E is for Employees. Employees are your other most valuable asset. Find ways to make them more valuable to you — cross-training, attitude improvement, getting them to buy into the fact that your business supports them and you, and make sure they know that they are important. Ask for their ideas, and pay attention to their answers. They might know more than you think.
F is for Family. If you're worried and stressed, probably everybody in the family knows it. Plan family events that are fun and inexpensive (or free). Everyone needs time to relax a little. And don't forget to solicit your family's help — there's no tellin' where a good idea will come from. Also, if things are particularly rough, cutting costs at home might be helpful.
G is for Growth. By growth, I mean an increase in net profit. Become lean, maximize profits, minimize expenses and put an end to costly mistakes. Teach your sales force to upsell. Stress value — the best counter is not always the least expensive. Consider coved splashes, vanities, sinks, tub and shower surrounds and bath accessories. If you add something on to each job, your net profit should go up very nicely. I'm reminded of Mrs. Lee who owned a terrific Chinese take-out place in Fairfax, Va. "Price is not just about how much food is in the container. It's about how much meat or shrimp is in it."
I is for Insurance. Can you do better? Pick three companies, including the one you now have. List the things that are most important to you, and find out who has the best pricing.
L is for Lean. Lean manufacturing is about how best to get a product completed in the shortest amount of time, with as few steps as possible, with total efficiency and no waste of materials or manpower. The better you are at this, the better your bottom line will be. The idea is simple and obvious — the solution not always so.
L is also for Learning. The library is filled with good books on business, management, sales, marketing, etc. Also, you can search for any topic or thought on the Internet, and get great information. Learning new things and getting new ideas can never hurt.
M is for Marketing. Identify people and places that use your products. Partner with a remodeler or plumber. They're in people's homes and businesses all the time, and are in a perfect position to find new business. Visit local hotels, motels and restaurants. Do they need new vanities? Front desk counters? Breakfast bars? Get a booth at county and state fairs as well as at local trade shows. You never know who might be there.
N is for New Segments. If your business is all about kitchen dealers, let's say, try soliciting other groups such as remodelers, builders, architects, hotel managers, etc. Become a member of a local trade or building association. It's a great place to meet new professional people who might be interested in using your services.
O is for Organization. Have you thought of organizing your install trucks? Build a setup that ensures each tool and supply for an installation has its own dedicated spot. Once everything has a place, you'll be able to look in the truck each morning to see what's missing. (Out of adhesive? Need a router?) Best of all, when the guys are getting ready to leave a job they have finished, they can look in the truck to see what's missing. No more wasted trips back and forth for tools and supplies, and no more buying tools to replace stolen or lost ones.
P is for Paperwork. Many errors occur in the paperwork. They could be miniscule (a wrong digit of a phone number; no sink cutout; a wrong color or edge profile), but any error on the paperwork is a problem. All information on each contract needs to be double checked. If information is not available (i.e., no sink cut out), the job packet should never enter the shop until the information is received. Change orders should be done on brightly colored paper, and everyone should know the rule: "Read change orders first." ISSFA has checklists you can download so that you can better organize your operation.
Q is for Quickbooks. This accounting system is used by many small businesses probably because it is easy to use. In addition to the simpler processes, it can perform many operations that might be helpful to you. Find out more about how accounting software can help you keep track of your business.
R is for Rest & Relaxation. Take time for yourself and your loved ones. It's been said that on anyone's death bed you'll never hear the words, "I wish I had worked more."
S is for Sales. Teach your salespeople and your wholesale customers to love the products you sell. Bring them to your shop to actually make something simple, or at least to see and learn. Give them a cutting board to take home and use. The best salespeople love the products they sell.
S is also for Skill. Now is the time for cross-training. Your employees can help you succeed if they have knowledge and skills. Help them to help you.
S is for Systems, too. Total Quality Management (TQM) says: Employees don't make mistakes. Systems do. Improving your systems will change your business, especially if your systems are in dire need of change.
T is for Trade Associations. There may be nothing more important than learning from your peers. After all, these are the people who do what you do every day. And, they might do it better. Who better to talk with than a peer? Trade associations bring peers together. They offer training, a sounding board and a list of benefits.
U is for Upselling. This is where the profits are hiding. This is how best to increase your bottom line. It takes training of sales people and cooperation from the boss.
V is for Value. You have a great product, and most people would love to have it, but don't understand the real value of it yet. Don't keep it a secret. Explain the value of your product to your salespeople and to your customers. They will understand and re-evaluate their choices if things are explained to them. Turn them into believers.
W is for Work. "Work smarter, not harder." This old saying can be applied in many ways. For example, if it takes a fabricator one minute to find and change a piece of abrasive on a sander, or if self-stick abrasives are changed with each top, then there is much waste. Purchasing dedicated sanders for each type of abrasive would pay for itself quickly in savings of time and disks. Evaluate each aspect of your business with an eye for "working smarter."
X is for eXert. Exert yourself on important issues and don't waste time on BS. Be proactive about details.
Y is for Yourself. Take good care, exercise and take it easy on junk food or drinking. Don't smoke. Just do the right things to keep yourself healthy.
Z is for Zzzz's. Get sleep. These can be tough times.
Be cheerful. And remember, a good attitude starts at the top.
About the author:
Joanna Duggan is a founder of the International Solid Surface Fabricators Association (ISSFA), the Surface Fabrication & Design Expo and this magazine. She can be reached by e-mail at joanna.duggan25@gmail.com or by phone at 702-525-6486.
author: By Joanna Duggan