A Different Thinking Time
A few months ago, I discussed how my company decided to fire our major account. While this was the right move, it was certainly worrisome to risk losing volume in a time of recession. But in analyzing our remaining accounts, we discovered that while these clients each represented lower sales volume, the gross profit was higher. This prompted me to recall one of the lessons my father Domenick taught me. He used to repeat the adage, "the big ones don't let you eat and the little ones don't let you sleep." It took a few years for this idea to sink in. The big accounts, with the large orders and popular name brands, seemed more glamorous. But we were squeezed on prices then and now. Sound familiar? The smaller accounts seemed to be bothersome for the amount of units they ordered but the gross profit margin was more attractive. Let's remember the name of the game is profits and not just sales.
The aggravation or annoyance that you may encounter from handling smaller accounts should be ameliorated by the use of technology. With a sophisticated data base for enterprise resource planning, dealing with smaller accounts is made simpler. And they still remain profitable. Now that's attractive.
In these challenging times, it's important not just to review and select your account base but also to keep your mind and the minds of your associate's wide open to new opportunities. Brainstorm with your team to develop fresh ideas for marketing and services. If you get fifty ideas contributed and only two are valuable, you are still ahead. Quoting from an Investor's Business Daily article, Mr. Jay Forte, a consultant, reminds us to "tell your people that no matter what happens, we are all going to look for and take advantage of opportunities. By creating a culture of learning, where you're soliciting input from all employees and sharing the latest news with them, you make it easier to include them in your hunt for opportunities. Have them gather information about you industry and talk to customers so that they're always generating ideas."
Business owner sees positive in negative economy, plans to expand
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Winning Alliances
Strategic or tactical alliances or partnerships are formed all the time. We may not formally define or design them as such but the benefits remain attractive. The key is to consciously understand how you can best determine how the relationship will be formed and attain maximum benefits to all parties. In other words, how can the relationship be built to assure profits for the long term or any of the desired results among the partners for the short term? In her book; "Intelligent Business Alliances," Larraine Segil describes an approach she invented called the Mindshift Method. When forming a partnership or alliance, diagnostic needs to be performed as to the stage of the business and the complimentary personalities associated with each stage. Trying to form a successful relationship without regard to these facets will be difficult at best and probably lead to a breakdown for reasons that could have been averted. The risk of not analyzing the factors can be loss of money, opportunity and continual stressful relationships in the workplace. If you have experienced any of these negative outcomes possibly there were some key points that may have been overlooked prior to forming the business entity.
Count People Most
During these times it seems that newscasters and reporters are trying hard to describe and define this difficult economic environment. Is worse now? Will it get worse before it gets worse? Sure, psychology plays a significant role in our spending behavior. The economic cycle can slow down when everyone cuts back. But the wheel goes the other way also. The older we are the more cycles we can recall. We have always come out of a downturn and this time will be no exception. The world population continues to grow and people have growing needs for food, housing, transportation, and uniforms. This is not a news report but a business manager's viewpoint. How do we handle these rough times until the eventual upswing occurs? As sales dip, where do we make cutbacks? The last place you want to look to eliminate expenses and assets is among your human capital. With few if any businesses excepted, people are your most valuable asset. So you need to think about how to keep your organization in tact given the current economic pressure so that you are properly positioned for future growth and profits.
Superior Uniform Group Declares Quarterly Dividend
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Metcalf Brothers: Growing to the Needs of the Market, Despite...
Larry Alpert, owner of fabric supplier Metcalf Brothers, refuses to call the current economic situation a crisis, preferring instead the feel-good term, "challenging." "Yes, agencies are cutting back across the board, but we remain optimistic about the opportunities of '09," says Alpert, the fourth generation owner of a company that's been around for over a century. "This type of environment lends itself to Metcalf."
Apparently so. Over the past year, Metcalf has grown an astounding 44 percent, winning countless new customers while solidifying its relationships with established ones. "We're getting programs that other mills have had for many decades, because there's no comfort there anymore," says Alpert.
And in a down economy, as every business knows, comfort becomes paramount.
The problems experienced by the country's mills have been well documented here and in other publications. In a David and Goliath-type situation, companies like the mid-sized Metcalf have seized the opportunity, learning from the competition's mistakes to improve their own business models. "In this environment, you have to be agile, with an ability to change quickly," notes Alpert. "Historically, the big mills have tried to get customers to grow to their needs, while Metcalf has taken the opposite approach: we grow to the needs of our customers and the market, and this has been key to our success."
Yet you can't thrive in this business without the right product, and at this moment in time, the Metcalf product line is hot. Unlike other mills that produce piece dye fabrics, Metcalf's only carries stock dye/fiber dye products. For those unfamiliar with the terminology, a primer: with a stock dye/fiber dye product, the actual fiber is dyed, as opposed to the more popular piece dye practice, where the fabric is woven then dyed.
