As of this writing we’re in our sixteenth year of business. We’ve been profitable for the past thirteen of those years we’re happy to report. We’re survivors, if you will. We’re not having an easy time of it, though. Things are rough out there; we hear it daily from our customers, and we feel it daily as well. Of course we have taken steps such as being more frugal in the day-to-day, and we’ve done things to better our chances of continuing. After all, running a business is not a passive affair. Sometimes one has to work at it. But this is common sense and you already know this, don’t you?
Over the years we’ve managed to stay current with our vendors — and keeping up with UPS’s monster shipping bills is no easy feat. We’re proud of this. We’ve stayed debt-free and thanks to a little corporate responsibility, being accountable for our own actions and wastes where applicable, we’ve not had to consider begging the government for a taxpayer-funded bailout. Not that we’d ever get something like that. But we’re glad. When a company gets that far off the beaten path they’re probably doomed in the long run. After all, a bailout is temporary if the greed and wastes continue unabated. But this is another topic all to its own, isn’t it?
To get back on topic, because of our hard-earned successes, we’ve learned some things over the years. We’d like to share some tips that will hopefully help you ride out this wave of despair with us, so we can all be there when the tide inevitably turns.
1. Be Creative
Sticking to tried and true methods are great if said methods are working for you. If not, it’s time to get creative. Bring something different to the table, a new service, a treat for your customers, a new marketing avenue. It’s time to think outside the box.
We know one greenhouse retailer who built a playground next to their outlet. Nothing fancy or expensive, some imagination was put to use, some sweat equity invested, and some junk recycled. They did this so customers with children could drop the kids off in the play are while they took their time shopping for plants. The result: Unpressured parents shopped longer, were more relaxed, ask more questions of the staff, and made larger purchases.
Another example comes from a fireworks retailer. It’s a different industry, but their creativity is certainly transferable. We had a choice this summer to buy fireworks from a couple different retailers. Both offered a two-for-one sale and their prices were equitable. One retailer, however, offered a fun gamble: If the temperature hit a high of 97°F on a particular day at a given location, as confirmed by the National Weather Service, all purchases would be returned. This was an investment for them as they did purchase an insurance policy covering the “insured event,” but that’s the extent of it. Since out-of-pocket costs were the same regardless of were we purchased our fireworks, it was a matter of choosing to gamble. It was free, it was worth a try, and it proved great for the retailer. Too bad it was cool on the big day.
2. Try Harder
I was searching around a store the other day trying to find something. A clerk walked by me, looking the other way hoping to avoid eye contact. Then another walked by, he did the same. Two more were in sight, but near another isle. They were chatting about something that was rather funny. I couldn’t find what I was looking for and ended up having to disturb one of the chatting clerks. They seemed pleasant enough, though I could tell I was breaking their stride. There was a notable undercurrent of annoyance. Do you see the problem here? If this describes your employees, do yourself a favor and fire them all right now.
Employees, or any business face for that matter, must be positive, encouraging, available, helpful, and actually willing. The first and ongoing customer interactions are make it or break it moments. I doubt I’ll go back to the store I went to unless I really have to — and I don’t. If the impression you give your customers rivals the experience I had, your customers may shop elsewhere, too. Call it natural selection if you will — Darwinian thinking can, after all, also apply to business.
3. Give Something Back
For years, since the beginning actually, we’ve always tried to provide copious amounts of information about biocontrol and IPM. This is our way of giving back. Moreover, in our case, it’s smart business. We want our customers to be successful, so we try our best to ensure all the tools are in place to help them get there. Some of our competitors provide ancient, on-demand “fact sheets,” a skimpy price list, and their web sites are dedicated to sales and self promotion. We knew from the beginning we wanted to be more to people than just bug vendor. We wanted to offer added value.
Sure, we have the bugs, and the goods, and books, and we do a great job packing and shipping them. We also have great customer service. But we wanted to mean more to people than just those things. We wanted to teach and support, to offer customers a friend on the inside, so to speak. We think this has led to our success. We think it can lead to your success as well. If you sell plants, for example, also be there with cultural info, pest control info, and any other kind of info that you can think of. Sure you may have a plant tag that says it all, but you can do better than that. Perhaps consider throwing in a small token of your appreciation, maybe a bit of starter fertilizer. Anything. The point is, try harder.
For more on giving something back, check out the next item.
4. Buck a Trend
For 2008, despite continuing pressures to raise prices (like everyone else seemed to do this year), we wrote an elaborate custom calculator algorithm and script, reprocessed all of our pricing, and managed to reduce at least 90% of our prices from 2007 going into 2008. Call it an antitrend if you like. Some might consider lowering prices in this day-and-age a really bad move, and this sort of thing takes some time to offer its inherent benefit, but we wanted to be different. Moreover, we feel strongly that all profitable businesses need to give something back in rough times, to lend oneself to the betterment of the economy for all. We hoped others would follow our lead, but they didn’t. We were naive. We discovered most businesses raised prices to protect the status quo.
It wasn’t a bad move, though. Our bottom line is right around what it was for 2007 in terms of allocation percentages. Reducing prices combined with smart cutbacks allowed us to generate a lot more business this year without taking it on the chin harder than we had to. We’re not flush or rolling in dough, but we are surviving and helping others at the same time. It feels good.
We don’t have the lowest prices across the board. We can’t. Two of our competitors have planted moles in our customer database. They do this so they can get our catalog without actually being obvious and asking for it (we’d give them one if they asked). They then undercut our prices as much as they can a few weeks later. We’ve known about this for years, we even know the particulars (they’re not as tricky as they think), but we’re okay with it. Instead we focus on ourselves, blowing them away in the areas of added value, customer service and communication, and product quality. We fight the good fight and let them do what they feel is best for their firm. We buck the trend in the ways we can.
5. Cut Back Smartly
A few years ago we had a postage machine, one of those gadgets that applies a dated ink stamp indicia to envelopes. Lots of businesses use these to: 1) look more professional; 2) avoid inventorying various stamp denominations and; 3) avoid licking stamps. The cost for such a machine, though, which had to be leased, was over $70 per quarter! We didn’t save anything using it, either, even though they do make the postmaster’s job a little easier what with not having to “cancel” our stamps. We decided to get rid of it and go back to using stamps. It was a cutback to help ease expenses (we draw the knife really close to the bone). Yet it wasn’t a cutback that worked against us or diminished us in any way. Our stamps may be less “professional,” but has anyone noticed or cared if they did? Do you think less of us because we don’t use a stamp machine? Inventorying them is not that great of a challenge. And as far as licking stamps, well, the ones we buy now have a pressure sensitive adhesive. It was a smart thing to cut we think.
So where’s your excess fat? Don’t cut back on advertising, don’t lay off employees poised to help build your business, don’t run scared and foolish, but do cut back on the unnecessary stuff if you want to sweeten your bottom line. Dig and discover, the fat is there and you can cut it out if you’re serious.
6. Stay Positive
We know one grower who gets hit harder and harder every year. He’s a long time customer of ours and someone we consider a friend. He’s bitchy, though. A cantankerous old man at times. He does nothing but complain how unfair things are, how Wal-Mart is kicking his butt, how fickle customers can be ingrates at times, etc. It’s foremost in his mind, flows from his mouth like a river, and permeates his very being right down to his core. Unfortunately, he exudes his bad attitude during every customer interaction giving his customers a dose of his bad attitude.
On numerous occasions we’ve been candid with him, telling him he needs to cut the crap. He wouldn’t listen. We wish he did. 2008 will mark the last year of his now barely salable business. He will be moving to the backwoods of Maine as soon as its sold. We will miss him, but we’re happy to stop hearing his ceaseless tirade.
The message here, in case you didn’t get it, is be positive, even in the face of adversity. Griping about the world will not change it. Action coupled with a positive attitude will take you further. We know how hard it is, and we know how unfair it can be, but that doesn’t mean we want to be mired in it, and we know our customers don’t want to hear it either — they have their own worries. If anything, we should be their sounding board.
7. Be Brave
Go forth, press on, keep your chin up, be smart, do take some educated chances, cut back smartly, and last but not least, be brave. This, too, shall pass, as the saying goes.
