Operations Manuals

Many years ago when I was a rookie salesman for the Burroughs Corporation, one of my first assignments was to spend time getting acquainted with the “Field Marketing Manual” (FMM). The FMM was housed in several thick binders which were updated monthly. Covered in the FMM was everything from how to process sales orders to the furnishing of branch sales offices, to the size desks that managers could have, to how to fill out and file expense reports.

Over the several years that I worked for Burroughs I constantly referred to the FMM to ensure I worked efficiently, effectively, and within company guidelines.

While Burroughs was a large multi-national corporation, I have found over the years that a well defined operations manual is as relevant to a small business as it was to Burroughs. By clearly defining policies and procedures, the operations manual assures that everyone has the same “rules” and that repetitive tasks will be done consistently.

One of the things that makes McDonalds, Radio Shack, and other franchises so very successful is that they all have detailed operations manuals that drive the operation of the local stores – and employees are trained to follow the manuals.

Any size business should develop a manual. As a new process is developed, a situation encountered, the information should be captured and written up. But, the information is worthless if it is just kept on a shelf in the owners office. The manual should be available to all employees. Each employee should be taught to use the manual, and held accountable for doing things according to the manual.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com
will@limkemann.net

Competing With the Big Companies

It happens in every town. A big box store moves in and small businesses close. But not all. Some do survive and actually thrive.

Some time ago I met with the owner of a store selling mechanized lawn and garden equipment. Business is good despite the nearby Home Depot selling similar equipment. Nan’s store is in an affluent area, but is not even visible from the busy nearby road.

Walk into the store, though, and you find a spotless, well lighted, and spacious store with merchandise attractively displayed. The staff is warm and helpful, and they know their merchandise.

The myth, Nan told me, is that the big box stores are cheaper. She has top quality products that are price competitive with similar products at Home Depot, and she provides excellent advice and top notch service and a repair facility.

In spite of location, and despite the mindset created by big box store advertising, she does well through modest advertising, and lots of referrals by happy customers.

Smart business owners like this one can stand up to big box competition. But it takes some or all of these success factors:

1. Know your niche market, and carry merchandise appropriate to the market.

2. Don’t try to compete on price.

3. Keep a clean, well maintained, uncluttered, well lighted, and well appointed store.

4. Display merchandise attractively.

5. Create a culture with employees where: employees are enthusiastic and love coming to work, employees know and love the merchandise, employees love the customers, employees are empowered to do what is right for the customers.

6. Select a good location for your store to ensure sufficient traffic.

7. Provide outstanding customer service.

8. Be creative in promoting your store.

9. Exercise excellence in all you do.

10. Have sufficient access to capital so that you never have to cut visible corners. This can be from investors, floor plans, lines of credit, or your personal savings.

Other than location and capital, how can the big box store compete against these factors? But, it takes constant work and attention to every detail.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com
will@limkemann.net

Ohio Healthy Families Act

The November ballot in Ohio will include a union-backed sick pay initiative which has been opposed by many business groups, including COSE, and even by Governor Strickland. By all measures, this act will be detrimental the the Ohio economy and will deter businesses from starting and expanding in Ohio. The law firm of Licata and Torek have assembled important information about the act as well as actions Ohio companies should take in anticipation that voters do pass the act in November. Please follow this link to the Licata and Torek information.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com
will@limkemann.net

Personal Goals

The thing about small businesses is this. The business owner and the business are one and the same (sure, you have incorporated or set up an LLC to legally separate yourself from the business). But, the business exists to satisfy the needs of the owner, and the owner is crucial for the business to succeed, or even exist.

So, business goals are meaningless until and unless the owner has set her or his own personal goals. Unless the personal goals are understood, set, and met, the business is more or less not relevant.

Before putting together a business plan, a vision statement, a mission statement, or setting goals for the business, the owner needs to ask (and answer) these questions (the answers, as with all goals should be written down and from time to time reviewed and modified):

1. What are my values – what is really important in my life? Monitary wealth? Relationships? Family? A big house? A big boat? Serving my community? My church? Being liked by others? Controlling others? Building an empire? Being indepdendent? Making the world a better place? The environment? Creating jobs? (this is not an exhaustive list)

2. What are my financial goals – this month, this year, in five years?

3. What are my long term personal goals? To raise a family? To retire at 50? To travel the world?

4. How do I want to spend my time? What percentage at work? What percentage with family? What percentage doing other things that are important to me?

I find it helpful to write down my goals and post them next to my desk so I am constantly reminded of them, and can measure how close I am to meeting them.

Only after a business owner understands his/her own goals can the goals for a business be developed. More about that another time.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com
will@limkemann.net

Personal Brand

Every successful business has a “brand” that is known by its customers and sets it apart from competition. The brand is the combination of all of the little (and big) things that sets a business apart and that conjurs up an image of the business in the mind of anyone coming in contact with the business. The “brand” can range from how merchandise is displayed, to logos, to signage,  to cleanliness and conditions of company vehicles, to how the phone is answered. Everything a customer sees, smells, hears, and touches about the business contributes to the brand in the mind of the customer (or potential customer). More about company brands in a future blog.

But what about personal brands? Each of us forms an image in what we say, what we do, how we dress, and how we present ourselves to everyone with whom we come in contact. As small business owners, it is often impossible for our personal brand to be differentiated from our company brand. If we have spent thousands on a logo, had the best graphic artist in town design our website, and have a unique product, none of that will matter if personally we come across as unkempt, or do not communicate well.

So, how do we improve our personal brand. We need to really look in the mirror and try to see ourselves as others see us, or better, as we want others to see us. Is my hair neatly trimmed? Are my clothes well pressed? Do I exercise good personal hygiene? Are my shoes polished? Is my cologne or perfume too strong? Do I look others in the eye when I speak to them? Do I really listen to what others are saying or am I just intent on what I am saying to others? Do I write thank you notes? Do I keep my word? Do I follow-up? All of these, and more, work toward making our personal brand.

I was reminded last night by a friend, Mark Madere, that exuding a personal brand is critical in publicity and public relations. Mark, a professional photographer, produced my professional “head shot” photograph that you see at the top of my blogs. This enhanced my own brand significantly over the quick home-made photo that I had previously used. I would recommend Mark to anyone in the Cleveland area who wants to upgrade their image. See Mark’s web site at www.spectralight.com.

Often a personal brand can be greatly enhanced by just a small investment in a photograph, or wardrobe enhancement, or just a good shoe polishing!

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com

Upselling

For many many years I have had lawn care services periodically fertilize my lawn and apply weed control, crabgrass control, and other products to enhance the appearance of my lawn. Over three decades I have used, perhaps, three different lawn care companies. Now here is the amazing thing. All three companies have avoided opportunities to sell me related services. Sure, at the beginning of each season I get a letter suggesting a modification to my lawn treatment program like adding anti-grub treatments.

But what is amazing is that they have made no concerted attempt to sell me additional services that would save me time, make my property more beautiful, and enhance their revenue. Perhaps they do not offer services beyond applying lawn chemicals – if that is the case they are missing out on opportunities to sell additional services to existing customers (the easiest sale to make).

If they do offer additional services, they have not really tried to sell them to me. They have never offered to quote on mowing the grass, trimming the shrubs, fertilizing the trees and shrubs, removing leaves in the fall, or removing snow in the winter. These are all add on services that should well fit into the business model of lawn care companies. How much effort would it take, while they are applying lawn treatment, to count the trees or shrubs, and send my an unsolicited quote on some additional services.

Every business should be constantly looking at how to expand its service and product offering – especially to its existing customers.

Will Limkemann
Limkemann Business Advisors
440-817-0976
www.neobizadvisor.com

Should you fire your customers?

An accountant I spoke with yesterday told about a seminar he attended for owners of accounting firms. The leader suggested that firms periodically “fire” the bottom 20% of their client base. These are clients that produce little revenue, or clients that are just not pleasant to deal with.

This got me to thinking that the advice is good and may well apply to almost any business. The conventional wisdom is that 80% of sales comes from 20% of a firm’s customers. Why not, then, evaluate the lowest performing customers? So often these customers not only are producing marginal sales, but the business with them is also marginally profitable. Too often, these customers require an inordinate amount of support and “hand holding” further eroding any profits they might produce. Should you be spending time with these customers, or fostering even better relationships with large, or potentially large, customers?

Some business owners are afraid to let customers go for fear that sales will decrease. But, take a careful look at each poor performing customer. If customers are not profitable, “fire” them and let them be someone else’s problem.

Surprisingly, sometimes a fired customer will return begging to do business with you and will turn his/her attitude around and they will end up as good customers.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com

Keep Talking

Most businesses have experienced tough times. Most business owners seem to have no trouble communicating news when times are good. Unfortunately, many business owners stop talking when times get tough. Yet I can think of no more important a time to communicate with employees, customers, suppliers, bankers, and others when things are bad.

I have a client who is owed thousands of dollars for work satisfactorily performed for a customer. The money has been past due for several months. My client wrote letters, called and left voice mail messages, and sent e-mails in an effort to collect. The customer did not respond to any communication, leaving my client both in the dark and with little recourse. The client finally had his attorney sue for the amount due. This did get the customer’s attention and he quickly e-mailed the client. In the e-mail he said that times are tough, he laid off his staff, and has been trying to collect money from his customers. He also said  “If there is any way we can resolve this outside of the legal system, I’d obviously prefer that”.

Had the customer had the courtesy of responding to an earlier correspondence and explaining why he was not paying, it might be that it could have been resolved outside of the legal system.

Keep talking no matter what the news is. Your constituents will all appreciate it if you do.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com  

Meet Customer Expectations

How often have I heard “you need to exceed customer expectations”. I would be happy if businesses just met my expectations.

Last week I called my lawn care company to ask them to look at some brown spots on my lawn. The owner said that a technician would stop by the next day, look at them, and give me a report. The only way that my expectation could have been exceeded would have been to treat the spots so they would disappear.

However, now it is four days later and no technician – no report. Obviously I am irritated with the owner of the lawn care company for not meeting the expectation that he set for me.

Lessons learned.

1. Never commit to something you can not deliver.

2. Always, always deliver as promised.

3. If it becomes impossible to deliver as promised, communicate the fact to the customer in advance and reset the customer’s expectation. But have a really good reason for not being able to keep your original promise.

4. If you really mess up and totally miss delivering as promised, now is the time to not only appologize and deliver what was promised (although late), but go way beyond by giving someting of value as way of appology.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com

Cut Energy Costs

In a recent blog I offered some hints on saving money on fuel for vehicles. But what about all of the energey that is being used in the office or plant? Here are some things to start doing today to do the right thing for your bottom line and the environment.

1. Perform an energy audit on your business. Make sure heating and colling systems are operating efficiently, are well maintained, and have clean filters. Check window and door seals. How about equipment, is it well maintained?

2. Shut off non-essential office equiment, and turn off equipment when not in use.

3. Replace energy guzzling equipment with newer more energy efficient models.

4. Replace incandescent bulbs with compact fluorescent lights (or better yet, with LED lights as they become available).

5. If your building is not new, check for adequate insulation and add insulation as needed.

6. Turn down/up heat/air conditioning (as seasonal appropriate) when building is vacated.

Will Limkemann
Limkemann Business Advisors
440-871-0976
www.neobizadvisor.com