Monday, July 25, 2011

Rupert Murdoch Taught Me An Important Lesson Last Week

He sure did.  And I was surprised that I could learn from Mr. Murdoch.  After all, I am a small businessman, ran a company with 250 employees, do a little consulting and writing now, and was nowhere in his multi-billion dollar league.  So, I want to share with you what Mr. Murdoch taught me.

First, a little background.  There are two results of learning by observing others.  One way is that you observe someone doing something well; you take the same steps in your company, and lo and behold, your company is now doing something well.  The other is to observe someone purposely stepping into a deep mud puddle, and saying to yourself, I should not follow in his footsteps.

To me, Mr. Murdoch stepped into the mud puddle relating to the telephone hacking scandal in Great Britain. 

A British Member of Parliament asked, "Was he ultimately responsible for this criminal enterprise at his British Operation?"  "No", he replied, "I hold responsible the people that I trusted to run it and the people they trusted."

Now, Mr. Murdoch is the Chairman of the Board and CEO of News Corp, which owned the newspapers involved.  His family owns controlling interest in this multi-billion dollar company.  Last time I went to school, I learned that the person in charge is responsible for everything.  President Harry S. Truman said it best with a sign on his desk, "The Buck Stops Here".  You make the big bucks, you sign everyone else's paycheck, you are responsible.

The surest route to ruining any organization is to not accept responsibility and to blame those under you.  No employees will take risks after that.  No one will respect you after that.  No one will be eager to gain a promotion after that.  No one will want to work for you after that.

A leader cannot side-step around taking responsibility.  That is one of the very definitions of leadership.  When you run your glass shop, or any business for that matter, you can be disappointed in an employee who makes a mistake; you can teach them, or ultimately you can fire them.  But that does not take the place of accepting responsibility for every action that takes place in your organization.

Not that I ever would have wanted a job in Mr. Murdoch's vast empire, but after his comments, I won't even bother sending my resume.

Tuesday, July 19, 2011

How Granite State Glass Is Fighting The Recession

I have a friend, Malcolm, who is an architect in Keene, NH, the closest city to where I live.  He invited me to a 'lunch and learn' session at a local general contractor where the subject was Doors and Windows.  He thought it would be of interest to me.  He was right.  I came away with knowledge, but what I gained most will help every glass shop and contractor in the country.

The program was taught by two representatives of JELD-WEN windows, and they really knew their stuff.  They kept the program clear of advertising and self promotion, teaching about different kinds of windows and doors.  There were twelve estimators from the GC at lunch, and they knew who was doing the teaching.  In fact, they were more impressed with JELD-WEN for being neutral and not taking advantage of the situation.

But the real winner, from a business point-of-view was Granite State Glass, the leading glazing contractor in New Hampshire, with eight locations in New Hampshire and one in Vermont.  They were the ones that set up the program and recruited JELD-WEN to do the teaching.  Two senior members of Granite State's marketing team were there, but in the background.  They introduced the speakers from the window company, and at the end, thanked everyone for coming.  They also offered each person there a binder with ad sheets on some of their specialty products.  It was just a perfect undersell.

Granite State didn't wait for some business to come knocking on their door.  They created an image of knowledge and competency in the estimating crew of the largest GC in our region.  Talk about hitting a home run!

You can do the same.  Every major vendor you deal with will be glad to send in an educational team for a presentation like this.  Whether it comes from the aluminum sector, a glass fabricator or floater, or fenestration suppliers, there is a tremendous amount of knowledge out there that your customers would be eager to learn.  This didn't cost Granite State a ton of money.  They had a box lunch for a dozen people, and their invested time.

Line up your vendor(s) of choice...people who have a story to tell about new energyy-savings products, decorative products or safety for building occupants.  These are all hot topics right now.  If your vendors are certified by the AIA to offer Continuing Education Units, which will be important to the GC's and the architects, this will help.

The work you have to do is to prepare your own marketing materials.  Now you don't have to create new stuff.  Use the brochures from your key suppliers, and place them in a three ring notebook with a sticker from your company on the cover.

Don't skimp on the lunch.  The difference between a $6 lunch and a $10 lunch is a good will bonanza.

Granite State, as far as I saw, didn't get any work that day.  But the impression they left of professionalism and knowledge about glazing and glazing products will get them work in the future.  You can do this too.

Monday, July 11, 2011

An Easy Way To Gain New Customers...And Cheap Too!

Radio Advertising?  No.
Television Advertising?  No.
Hiring A Clown To Stand Outside Your Front Door?  No.
Full Page Ad In The Yellow Pages?  No.
A Web Site That Really Pops?  No.
Newspaper Ads That Blanket Your Market?  No.
Creating A Referral Program From Current Customers?  Yes!  Yes!!  Yes!!!

My wife, Elaine, forwards me articles that she comes across that might make great blogs.  This time she hit a home run, sending me an article about customer referrals originally published in the Harvard Business Review.  The article details a large bank in Germany that started a customer referral program.  It turns out that the new customers brought in during this program were more loyal to the bank, keeping their accounts longer, were more profitable to the bank, as they were less expensive to obtain and used more bank products, and they did more business with the bank than other new customers.

This study followed 10,000 new customers at the bank over a couple of years.  There are no glass shops that I know of that generate this many customers.  But the lessons learned are the same.  Do a good job for someone, they tell others, and you will gain new business that will be profitable.  A customer who wants you to do work in their home or business won't give you a small job to try you out.  After all, their friend did that for them.  A referred customer will trust you from the start and will want to work with you to the fullest extent possible.

You get the picture.  Let's look at some ways that a glass shop can gain these types of customers. 
  • Your first step, do a great job for your current customers.  Do such a good job that these folks want to brag about you.  This doesn't mean a low price; it means leaving the site cleaner than you found it; it means being on-time, polite, and non-intrusive in your customer's home or business.  It means doing the job contracted for, or improving on the design once you opened a wall or framing.
  • As you near the end of the job, ask the customer if they are pleased so far.  Get their input before you finish the job and solve any issues that come up before you close up.  At the end of the job, ask the customer if they are extremely satisfied, and if not, what would it take to get to this point.  Then do what they ask for.  (This does assume that all financial terms have been met up to this point.  If not, you will have to go the route of being cautious.)
  • Since they are now completely satisfied with your work, ask them to refer their friends to you.  It sounds simple, but the basic question should be asked, planting the seed in your customer's mind.
Let's take it up one level.  Create a program that any customer that comes to you because of a referral and spends more than $500, gets a 5% discount on their work, and the referring customer gets a certificate good for $50 off on any further work with you.  Sounds corny, but it does work.

Your current customers will be giving their friends 5% off on something, which makes them feel good, and they may earn discounts on your future work, which makes them feel good.  At the same time, you feel good because of the increase in business.  Trust me, this works.  It is used by many companies in many industries throughout business. 

It takes some ongoing work, a letter every six months to old customers reminding of your program; making sure that new customers are queried as to how they came into your store, and if by a referral, getting the reward letter out right away to the previous customer. 

The best advertising in the world, bar none, is when a satisfied customer tells a potential customer.  You can take this one to the bank.

Tuesday, July 5, 2011

This Blog Has Nothing To Do With The Glass Industry, But You Should Read It Anyway

Today the glass industry is not important.  I have a story to tell, one so important that it must be published.  This is a story about my next door neighbor.  For this story, let's call him Bill, but  everything else about this story is absolutely true.  Read on.

Even though Elaine and I live in a fairly rural area of New Hampshire, we do have a next door neighbor.  Bill lives about 1000 feet down the road.  His wife and daughter live at home and their grown son lives about an hour away.  Bill is a tall, thin, and normal person about 50 years old.  About two years ago he developed symptoms that Doctors had a hard time understanding.  There was about a year of extensive testing and head scratching.  It turned out Bill's heart was failing.

In October of last year, Bill and his wife went to the Mayo Clinic in Minnesota.  He was there for two months and was told his only option for life was a heart transplant.  Talk about life-changing.  He came home under a plan that the Mayo would call him at any time, and he would jump on a chartered jet for the operation in Minnesota. 

The travel logistics were slightly confusing, to say the least.  So Bill and his wife went to the Massachusetts General Hospital in Boston, about an hour and a half away from here, for a second opinion.  After a couple of weeks there for testing, their opinion was the same.  His only choice would be a heart transplant.  His condition deteriorated even more, and Mass General felt he should not go back home as any infection or problem could have disastrous results.  In the second week of January, Bill was admitted to the Coronary intensive care of the hospital, to await his surgery.

Mass General usually does about 25 heart transplants a year.  But not this year.  Bill lived in the hospital for almost six months, waiting.  He had a couple of 'possible' hearts, but they turned out not to be compatible.  From January through June, the Hospital only did a handful of transplants.  It seems that less donor hearts were available because of some amazing statistics:
  • More cars have air bags as new cars replace old ones, fortunately killing less people.
  • Also, the whole country is driving less because of the price of gas.  Most heart donors come from automobile accidents.
Bill's wife took the train to Boston four or five days a week, keeping his spirits up.  Elaine and I went in often as well, bringing in food and having mini-parties in his room.  Bill started having second thoughts, but his Doctors explained that if he did go home, even for a day, it could have very bad repercussions.

Bill wanted to get home for so many events.  He was crushed that he could not attend his daughter's high school graduation.  So, we took the graduation to him.  She graduated on Saturday morning three weeks ago.  Saturday afternoon, we all drove into Mass General.  His daughter came in her cap and gown and we had a real party that was set up and organized by the caring hospital staff.  Bill was so happy.

Then, as we left, it was back to the normal days in the cardiac unit.  Except, on the very next day, at 3:00 in the afternoon on Sunday, a heart was brought into the hospital.  It matched.  In the blink of an eye, the surgery started.  It took over fifteen hours to complete the surgery by dozens of surgeons, nurses and staff.  It was a success from the first new heartbeat.

Last Thursday, Elaine and I drove into Boston and brought Bill home.  When he saw his home for the first time in almost six months, he was ecstatic.

Think about it.  Two and a half weeks after this incredible surgery, he was home feeling better than ever.  He will be monitored for life, and have to be careful with certain health situations, but this is a minor inconvenience considering the alternative.

Miracles defy explanation.  This is not a miracle, but is the result of hundreds of dedicated doctors, nurses, aids, lab techs and so many more.  This is because of a family of a deceased person who helped another life continue.  This is because Bill's family always smiled and cheered him on, month after month. 

This is because of health insurance that covered expenses and employers who granted time off.  This is because of years of research and testing by medical labs.  And yes, there is a little bit of miracle thrown in.
 

Tuesday, June 28, 2011

I Bought A New Car...Big Deal...But I Learned A Few Things That Will Help A Glass Shop

My 2004 Chevy flunked the state inspection the other day, and it kicked me over the edge to buy a new car.  In my area of New Hampshire you don't have the option of going from dealer-to-dealer looking for deals.  There is one Chevy dealer and one Ford dealer, along with all of the imports.  I was only going to buy American, so I had two choices.

The Chevy dealer has a very small showroom, only four cars fit in.  Two of the cars were antiques, not for sale.  Just there to draw traffic in.  Even though they were cool to look at, the car I wanted to buy was nowhere near.  It was a nice day so we walked out on the lot.  If it had been raining, or in the winter, I would have left without seeing a car.  The lesson for you:  Show off what you sell.  Don't put things in your glass showroom or waiting room that have no meaning to what you sell.  It is nice to show tradition in a small way, some pictures of your family, but your main impetus has to be showing products you currently work with and make money from.  The person is in your waiting room or showroom; they don't have to be convinced to come in the door!

The salesman did a good job of working with me, and I may buy his car.  I met the owner of the dealership and he was proud of his antiques, but didn't discuss the car I was about to buy.  A business no-no.

My next stop was the Ford dealer.  The had a much larger showroom, and the car I wanted was right there.  I sat in it 15 seconds after entering the showroom.  This had an impact.  But wait...there is more.

While the salesman walked away from me to research a question on  paying by credit card ( I wanted the airline miles), the radio station that was being played overly loud in the showroom had TWO commercials for other car dealers.  I listened to the competition in their showroom.  If buying in imported car was on my target list, there it was...a very good deal on the style of car I wanted. 

SiriusXM radio, on an all music package is only $9.99 a month , no commercials, and has 65 music channels, serving every taste in music.  Come on now...isn't that better than hearing a competitor's ad in your own store.  Also, when you play the local station, there is usually a political point of view.  If you play a conservative radio station, you will upset half of the population...and of course you will upset the other half if you play a station with a liberal bias.  Your showroom is not the place to promote an agenda other than selling your product!

Don't place magazines in your showroom that feature religion, guns, or politics.  There are enough construction, home improvement, architectural and decorating magazines around that every thing in your showroom should encourage customers to ask you questions about glass.  Every one of your vendors should give you catalog sheets or brochures that will help you develop business.

Make sure your customer bathrooms are spotless.  A dirty bathroom will guarantee that customer will not return to your shop in the future.  Are you the great-nephew of Elvis Presley?  If you are not, his picture should not be in your showroom.  The best things for your walls are actual job pictures of your work and testimonial letters from your customers.

If you have a coffee pot for customers, make sure it is clean and refreshed often.  If you have a vending machine for coffee or snacks, keep it clean and well stocked.  Don't depend on a traveling route salesman to come in and clean it.  The machine represents you and the pride you have in your establishment and your work.

You have a captive audience for a few minutes; use it to your advantage in the glass business.

Monday, June 20, 2011

US Airlines Collect $3.4 Billion In Baggage Fees

In 2010, US Airlines collected $3.4 billion in those annoying baggage fees, up 24% from 2009.  This is what an industry does when they can't raise prices, but costs go up.  Doesn't this sound a lot like the energy surcharge?  If you are a glass shop anywhere in the world, you have competition; you just can't start charging a new fee that your customers will pay because they have no choice.  You have competition, so what can you do?

The airport serving where I live has two carriers, Southwest and US Air.  I try to fly Southwest on trips simply because of the baggage fee.  But, there are no Southwest-type options for us in the glass business.  Each glass shop has too many competitors to be the one that stands out.  The advertising budget to let the community know what you are offering would certainly be greater than the increased business you could bring in.

Just about everyone charges a minimum for a service call; you may be able to raise that a little.  What you can do is charge more where it costs you more.  If a customer needs a service call where you will have to pay overtime, such as 6:00 in the morning, or 7:00 at night, you can charge a premium for labor.  Not for your time in doing a quote, however.  Your time is just part of overhead in giving estimates or following up on a job.

Make sure you charge for tolls you pay going to the job.  Mention this in your quote.  If you are going to a secure site, like an airport, and need to spend an hour in line waiting for security clearance, be sure to include this cost in your estimate as a separate line item. 

On your estimate and invoice, clearly state your terms, and be sure to add a phrase detailing an additional 1.5% charge for bills over 60 days past due, no matter what the agreed payment schedule is.  If customers don't keep the schedule, you should charge this premium.

If the customer asks you to remove extra construction debris, then it is alright to charge for your labor and the extra cost of your dumpster or dumping fees.  Sure you want to be a nice guy and do something extra for your customer, but don't do something that directly costs you money. 

Don't be afraid to charge for a second visit to a customer when they weren't ready for you on your first scheduled visit.  You load your truck, and schedule the day; if they didn't have the courtesy to tell you in advance to hold off, then they should pay you.

Make sure you know what your fabricator is going to charge you for oversize glass, special edge work or shape cutting, rush service or anything out of the ordinary, and be sure to quote this up-front.  You should also add your mark-up to these additional fees.

On all of your quotes, be sure to add a time escalator.  If the customer calls you back in six months and says they are ready for the job, it may be very tough to honor the old quote. 

In my opinion the best extra you can give a customer is doing exactly what they ask for in the original quote.  Do the job neatly and leave the job site with your product perfectly clean.  Have them sign off that the glass is fine before you leave.  If you do great work, at your quoted pricing, you will get referrals, which are the best source of work for any glass shop.

Tuesday, June 14, 2011

What Anthony Weiner Can Teach Every Businessman In America

Anthony Weiner is a US Congressman from Queens, New York City.  He has been in the news lately for first denying that he sent some lewd twitters and messages to women.  He originally claimed that someone 'hacked' into his personal accounts and sent the photos.  A couple of days later he reversed himself, said he did indeed send the messages, and apologized to his pregnant wife, his constituency and to the Congress of the United States. 

He then went on to say that this was not a serious enough problem to require him to resign from Congress.  That statement is more obscene than the stupid pictures he sent.

When people look up to someone who does something so patently stupid and immature, causing them to become so disappointed that they lose faith in the system---whether it is Congress or your business---employees will lose their desire to work for you.

You are the leader of your business.  In our case you are probably in the glass business.  You have the responsibility to lead professionally.  If you make a mistake like mismeasuring a job, that is part of our lives.  But if you make a moral mistake, and your company learns of it, you will no longer have your employees' respect or enthusiasm to help you run a profitable business.

As an owner or manager you have no choice.  You must take responsibility for your actions.  No choice.  I just heard a follow-up story on CNN where they stated 53% of Weiner's congressional district thought it was OK for him to stay in his job, while 35% thought he should resign.  What would happen in your company if 35% of your employees thought you were unfit to lead.  They would begin looking for other employers; they certainly would lose their dedication to your business.

You went into business to create your own future and to make a good living. Don't let something stupid get in the way.  Watch for this in your senior managers, watch for this throughout your organization.  Make sure you have a confidential communication system for all employees to contact you in the event they feel there has been sexual or any other type of harrassment.

Don't let something stupid ruin your life or business