They Blew the Leaves in My Yard!!

   My neighbor called about 10 minutes after the lawn crew was here to clean up the yard.  He said, "They Blew the Leaves in My Yard!"  Well, I went outside and sure enough, that indeed happened!  Now, we have great neighbor relations, so I was frustrated about that.  After all, I have used this same lawn service for 8 years, they do a great job and are very conscientious. 
    Now what?  We have never had bad neighbor relations before.
    Well, I did go over and look at the neighbor's lawn.  Yes, there was about 1/2 bag of leaves that was blown on his lawn.  He keeps an immaculate lawn, so I understood his frustration.
    I told him that I would call the lawn service and share what happened.  Well, the lawn service left a trailer here and when they came back to retrieve the trailer, I had a chat with the truck driver.  It turns out that he is the son of the owner of the service.  I told him what happened.  He told me, "I'll tell my mom and see what she wants to do.  There really were not that many leaves."  Well, I told him that I did go look and I did see what the neighbor was unhappy about.  I suggested that he go and visit with the neighbor.  He reluctantly agreed that he would do so.
    The neighbor called me and told me that the owner's son came and discussed the issue with him.  I think that they mutually agreed that the matter should not happen in the future.  All is well back in the neighborhood.
    Now, how could this happen?  Who was watching the employees while they were working?  Who would allow this to happen?  I am sure that the owner of the lawn service will be very unhappy and will take corrective action with her team.  She is not one to put up with any unprofessional conduct on behalf of her employees.  She is not mean, however, she does expect and normally is given professional conduct by her staff.
    There are a plethora of reasons why this happened.  Were the employees new this year?  Were they not told how to clean up a yard and not allow debris to go into an adjoining yard?  Did they understand the pride of their work and the ramifications when their work reflects negatively on themselves and their company?  Of course, I don't know the answer to any of these questions.  However, these are probably all items that need discussion during the initial training period.  OK, you say, these are just lawn maintenance employees.  Yes, true, however, pride and professionalism is an ingrained habit in any employee.  In this particular case, I suspect that we will not have any additional occurrences of this nature.
    Think about your employees.  What would have happened if these were your employees?  How would you have handled the matter?  Send us your response in the blog comment section of this post.  We'll post them!

5 Tips to Help Your Business Grow

   Hewelett Packard sent out an email yesterday that described 5 ways in which to boost your organizations' profitability.  I found these ideas compelling, so I want to share them with you-- we have talked about some of them on this blog before, however, you can never address these matters too much!

Idea #1-- Always Buy Quality-- You're Only As Strong As Your Weakest Link---- I have always said that it never costs any more to go first class!  Oh, the initial cost is always more, however, the recurring costs are either eliminated or reduced.  What many folks fail to realize is that buying the cheapest piece is always the most expensive because either the piece wears out prematurely, is not designed with the best features or is made of inferior parts which fail at a higher rate than good equipment.

Idea #2--Innovate: New Ideas Are The Lifeblood of a Business--- Seems simple enough, however, in today's changing business environment, innovation is the key to business success!  Trying new ideas, new concepts and new thoughts provide you with a competitive edge over your competition.  The more new ideas you try, the better your business will compete with other like businesses.

Idea #3-- Leverage Relationships:  No Firm Does It Alone----  This is probably one of the hardest concepts for many business owners to grasp-- you cannot do it all yourself.  You just don't have enough time, interest, expertise to be an expert in all facets of your business or non-profit organization.  Here is where outsourcing or use of consultants pays big dividends.  A consultant or outsourced function is an expert at that function, does not detract from your core competencies of your organization and is able to perform the task quicker, better and more effciently than you ever will be able to.  Accounting, information technology, marketing as well as business operations are all areas in which you can make money having these tasks completed by outsourced experts or consultants.

Idea #4-- Create Simple Programs: For High Frequency Repeat Buyers---- Create a scalable, fast and easy program with built in discounts to reward your repeat customers.  Repeat customers are the lifeblood of any business-- the car wash example is classic-- buy 10 car washes, the 11th one is free.  Same thing at the donut shop-- buy 10 donuts/cups of coffee, the 11th is free.  This works for everyone, you, the business owner, the client and most importantly, the new customers that you attract each day.

Idea #5--Love Your Customers: Take Care of Them---- The customer care component is key in today's competitive environment.  Everyone is competing for your customer-- what are you doing that is different, unique and creative that your competitor fails to do?  Try something, if it does not work, try something else-- the key is to continue trying new and unique ideas until you find some that work.  Review Idea #2 above!

These are all great ideas!  Use them and see what a difference they make in your business or organization.

This is Why We Are Changing Soft Drink Companies

    I visited with a quick serve restaurant owner this week and she told me that she was changing soft drink vendors.  She currently had Vendor A and elected to try Vendor B. Ummmmmmmm-- now that is interesting-- she had not used Vendor A very long.
    She agreed that she had only used Vendor A about 4 months--however, the challenges were more than she could handle! Why, I asked?  Here is what she said---
     The first couple of weeks were great-- good service, great sales person, everything was going well-- she envisoned a long term, multi year relationship.  On week 3, the salesperson came, she gave him the order and when it was delivered, it was mixed up-- really mixed up.  OK, no big deal--we are all humans, perhaps a glitch at the plant--they got it fixed and she got the products she ordered.  Another week goes by, same snag, however, not quite as bad.  This goes on for an additional 4 weeks-- never as bad as the first week, however, never exactly right either.  She calls the manager.  He comes out, personally, and apologizes for the many mistakes and errors, stating that things would be better from here forward.
      Well, for a couple of weeks that was the case---however, the salesperson must have gotten some "adult supervision" along the way--when he came out, he was ugly and unprofessional.  The owner said that she had enough of those kinds of attitudes with her own staff, she did not need that from a vendor!  I had to agree with her.  Now, understand that this owner is a very nice, personable and polite lady.  However, she expects that her staff works hard and her vendors work hard--fair enough.
       Finally, she told me that it worked best when she called the order in to the main distribution center, removing the sales person entirely.  At least the order was processed right and she got what she ordered!  She accepted this "service" from Vendor A, recognizing that this may be the best she could expect.  However, here comes the salesperson from Vendor B, explaining how their customer service was better.  She said "Why not" change and check it out?  So, she has changed Vendors!!
       Think about this if you were Vendor A!  Do you know why your competition got the sale?  Do you see how you could have "fixed" this problem and kept a profitable customer?  If you have questions, call us--we'll give you some ideas.  The final story is not yet written--Vendor B starts on Tuesday--stay tuned, we'll report on how it goes!

Where Did the Profit Go?

   I visited with a business owner last week and he told me a story that caused me to go into cardiac arrest--figuratively, not literally!  He told me that after making approximately $60,000 in sales last month, he was only able to take home less than 9% of that for "profit."  What was even more interesting was that more than 50% of his sales was from a product which has a 100% margin on cost.  The question becomes, what happened to the profit?  Well, that is the question that he asked as well!

    Now, this question raises a rich plethora of areas in which to explore for lost profitability.  Are expenses out of line with revenues?  Did he buy something that he did not need?  Was inventory shrinkage a factor this particular month?  Was there an error in the posting of the various accounts?  These are just some of the questions that I thought of as we were talking.  Actually, I thought of many more questions, however did not address them.

    The key here is be constantly vigilant on your business costs-- each and every cost.  Often times, research has revealed that once costs get out of control, it is very difficult, though not impossible, to bring them back in line with revenue generation.

    Although this particular business owner elected to work the problem himself, I doubt that the business owner will take a careful, critical eye to each cost that he incurred this particular month.  This is one place where the "why" question is important.  WHY did we buy this?  WHY did we buy so many?  WHY do we need it?  WHY don't we wait?  You get the idea-- just keeping asking WHY-- you will get to the end root cause-- which may not be the answer that you really thought was the right answer!

    Research has shown that some big box office suppliers provide "bonus" cards to their customers.  Interestingly, once a consumer has a "bonus" card, he/she will buy more product than what they actually need or require, thinking that they got a "bonus" from their card.  Yes, the consumer did get a discount, but bought more product than was required at the time.

    If you are having profitability issues, careful, critical analysis of the WHY question is the best place to start looking to see where, if anyplace you may have a profitability leak.

I want a DEAL!

    A friend of mine told me the title line the other day when we were discussing a business matter.  He told me that since the economic recession, he always looks for a deal, no matter where he goes, or what he buys.  He told me that he is always trying to get at least a 40% discount on whatever it is that he is buying.

     I had lunch with the CEO of a large accounting firm the other day and he told me that his business has changed significantly in the past 3-4 years with many, if not all of his clients wanting a reduction in fees, a flat labor charge as contrasted to time and materials billing.  The accounting CEO mentioned that many firms in the accounting space in which his firm practices have reduced their fees to retain clients.  The CEO mentioned that he was not going to reduce fees, however, he was searching for new market areas in which to practice.

    As I reflected  upon what each of these individuals said, it became clear to me that all of us have become more aware and cognizant of price.  However, price is only one component in the equation.  VALUE is the key that most business owners should be searching for, irrespective of price.  Why, you ask?  Well, here is the answer.  Value is the worth of the service or commodity that you are buying.  The value to one individual is different than that of another.  As a business owner, you must constantly be in tune with your customers and be sure that you understand what your clients view as your value proposition.

     The Accounting CEO stated that he had lost some former clients who sought similiar services based upon price alone.  He further stated that his clients had found other service providers which were cheaper monitarily, however, was he was unsure of the value they provided.

      I have mentioned on this blog previously that our firm uses a local travel agent for all of our travel needs.  Yes, we pay an additional fee for her services.  However, her perceived value is worth the fee that we pay-- after all, I am the one who writes the checks.  In fact, at the end of the day, the travel agent is usually able to find me a better deal than what I can find on the web-- be it time of departure, landings, hotel location, car size.  That is worth money to me and our firm.  Additionally, if something blows up in the middle of a client engagement, I have her to work the problem, not me or one of our consultants 5000 miles away from home.

     As you consider the value proposition, consider what it is that you are providing to your clients.  What is the real value that you provide?  How do you know and how do you measure that?

      I was in a restaurant the other day and visited with the owner.  He had previously told me that he was raising his prices because of increased food costs.  His new menu had increased food costs, however, on one particular breakfast entree, he also included the price of toast.  This had previously been an additonal up charge if you wanted toast.  I did not have a problem with this, because A. I like toast with breakfast and B.  I did not like to be charged additional for toast.  However, now that the toast is priced within the entree, I perceived additional value.

      Think about these ideas as you work your value proposition to your clients.  You may be amazed at the results!

Technology is a Force Multiplier for Sales Generation-- Are you using it effectively?

  A previous post addressed the use of the Apple IPAD as a Sales Generation Force Multiplier tool.  I addressed how one of our clients, Montague's Jewelers has successfully used this new technology to very successfully compete with web based merchants that sell similiar products.

   With economic conditions today being difficult for many small and medium sized businesses, any advantage that you are able to achieve will help increase your sales and hopefully, achieve more profit!

    Interestingly, as a small business, competing with many large web based businesses is perceived to be challenging because you don't have the tools or resources to be competitive.  Such is not the case.  In the jewelry store example, the jewelry store will "bring in" the piece that you wish to look at if they don't have it in stock.  If it is not what you want, they will send it back with no questions asked.  The return policy on many web vendors is not as near "customer friendly."  Again, in the jewelry business, if the piece that you buy from the web based seller is not what you want, most web based vendors have such onerous return policies that you end up keeping the jewelry piece, even though it is not exactly what you desired.

    Service is the key to any small or medium sized business.  We have cited in this blog previously that many people are willing to pay for good service.  In fact, most folks are willing to pay more for service-- and to have it provided by a local vendor is a real bonus.  With technology, you can successfully compete with the big web vendors and be able to offer home town service at the same time-- a "win-win" situation for everyone.

    Think about how technology will allow you to leverage your business opportunities.  The cost of many computers, laptops, telephones are such today that you cannot afford NOT to be using the latest tools for your business.

     This is not about reinventing the wheel!  The wheel has already been invented, you just have to adapt and apply it to your business today!  This is not a complicated task--however, you may need some help from a technology professional in identifying the specific tools you need for your business.  If so, now is the time to begin that journey-- you are missing out on sales that could enhance your profitability.  Let us know if we can help you adapt technology to your business operation.

Make Technology Work For You!

   Technology is constantly changing!  I am sure that you know and recognize that.  I suspect that many of your employees ask for advanced training on the many new pieces of technology available.  If they do, you should strongly consider insuring that you get them what ever technology training they need to make your operation more efficient.
   An article in the Billings Gazette on Sunday, April 17, 2011 shows how one local restaurant has elected to use the IPAD as their order taking device as well as their cash register.  You can read about it here.  I have not yet been to this new restaurant, however, I will go sometime this next week!
   I have another client in the jewelery business that also uses the IPAD to multiply his in store inventory with that of his various vendors.  He is able to show clients products on his web site, products on his vendors web sites as well as establish a register for his clients who are contemplating marriage!  The key to this use of technology is that my client is able to compete very successfully with large web based vendors who offer little to no service after the sale.  A small brick and mortar store stands behind their products and provides first class service for all of their clients, of which I am one.  Check out Montague's Jewelers here.
   Technology is the key to increased sales.  I have just cited two examples of businesses that I am familiar with who are using new technology.  Are you thinking about using new technology?  Think about it--you may be surprised at the results.

Have you started to Hire Yet?

   As I travel around the country, I see many signs of good economic recovery!  I was in the South the past 3 weeks and there were lots of help wanted signs up.  Here in Montana, I continue to see help wanted signs up all over Billings, our biggest city.  I talked with a business owner the other day and he told me there is a significant need for truck drivers with commercial drivers licenses (CDL).  One of the reasons for the need for CDL drivers is the demand in Western North Dakota for workers in the oil field.  
   With the summer season rapidly approaching us, you may wish to review your needs for summer help.  A local country club manager told me the other day that he only had to hire about 3 summer staff, most of his other folks elected to stay with him this year.  He was excited that he did not have to hire any more- the folks that stayed knew the business and did not require significant retraining.
    If you decide to add staff, insure that your employee manual is up to date.  Insure that your procedures manual has been reviewed.  This is a good time to review your manual if you have not already done so.  Be sure that the new employees read and understand all of the material contained in the employee manual.  This is also a good time to review the manual in general, to see what material may have changed, what additions or deletions you may need to make.  Be sure that you have your new employees read and review the manual during their first week of service.  Insure that each new employee signs a document acknowledging that he/she has received and read the document, understands all of the material contained therein and acknowledges compliance with the manual.  The employee should receive a copy of this acknowledgement as well as having a copy placed in the employee personnel folder.
   Hiring new staff is not a challenge if you approach the matter in a straight forward manner.  Having a gameplan developed on what and how you wish to hire will insure that you will not only gain the right employee, but have an employee who hopefully will be both productive and positive.