Adding New Services and Products
How do you go about determining which new product lines should be added to your business?
Although we’re now officially out of the recession, the market for signage and graphics remains very challenging and we all continue to face some difficult times as we battle to sustain success in our businesses. To stay viable, you should be constantly examining and evaluating not only the present state of your business, but also its future.
To that end, you have some options: One, you can continue to do business as usual, hoping and waiting for better times to come around again. Two, you can focus on what you currently do in your business and try to be the best you can. Or, three, you can try to develop new avenues of revenue in your business to help sustain you in this demanding market. My advice is to focus on the third option – developing new revenue options – while simultaneously working very diligently on your current profit centers.
But how do you go about determining which new product lines should be added to your business? Begin by looking at some areas that might already be a fit with the services you’re now offering. If you can provide your clients with products and services they’re currently buying elsewhere, you’re able to avoid the necessity of finding new customers with your product lines.
What follows are four product and service options to consider for your operation. fulfillment, installation services, graphics-display hardware, and electronic digital (aka “dynamic”) signage systems.
Fulfillment is a service most of us already provide to our clients. The problem, however, is that many in our industry don’t provide this service at a profit. Too many of us are afraid to charge the proper amount for packaging and fulfillment services.
Consider: When is the last time you bought something online and didn’t pay for packaging and handling? The fact is that the packaging supplies and the labor required to fulfill an order does represent a significant business cost. Even when we omit fulfillment charges but include packaging costs, we often significantly undercharge our customers for the packaging – because we focus on the cost of the packaging materials and forget that considerable labor is involved in this process.
So don’t be afraid to make money on this service. Charge your customer a fair price, a price point that allows you to make some money, and your customer will gladly pay it. The last thing they want to do is hassle with problems in packaging, shipping, etc.; they will pay you to take care of these factors.
Long gone are the days when you could tell your customers that you provide only the graphics and they will have to find someone else to install them. Today, the customer wants it all from a single source. So if you currently don’t provide installation, this might be an area where you can bring in some expertise and set up an install department in your shop.
Doing this will provide you with an advantage in a couple of areas: First, you’ll be able to provide your customer with better service. Using subcontractors is always a challenge when it comes to delivering the best service to your customer – they just don’t have the same interests in your client as you do. Second, you should make more money by running your own installation department instead of just marking up the cost from your current install vendor.
If you already provide installation services, consider expanding your install department to the marketplace as a standalone service. Yes, there can be some challenges when installing graphics that someone else produced, but they can certainly be managed with properly executed standard operating procedures used by your install teams. If you’re worried about running an install division within a market niche that includes your competitors, you can even spin the install department off as a completely separate entity with its own unique name and try to avoid perceived conflicts of interest with some of that market’s competition. While a standalone service is definitely a bigger and more challenging step, it can become a very profitable entity.
Typically, our shop sells graphics-display hardware – rollup display hardware, pop-up display hardware, banner stands, t-stands, A-frame sign holders, and other similar products – to our customers only when they request it. But consider the opportunities you might have if you sell graphics-display hardware as its own product line. This type of approach has the potential to bring substantial revenues to your company if it’s developed as its own business segment.
In our industry, the sale of hardware almost always follows the sale of the graphics. But, what if you turned that around and create a business plan that sells the hardware first to your current and potential clients – with the value-added piece being the graphics? This might even be a great online product to sell directly via your website.
If you’re like everyone else in the signage and graphics business, by now you have probably scratched your head more than once when trying to figure out just where and if electronic digital (“dynamic”) signage fits into your company’s business model. I intentionally saved this new-product possibility until last because it’s becoming a very interesting part of our industry’s future.
Whether you choose to get your company involved in electronic digital signage or avoid it altogether, it’s safe to say that it will affect the future of your business. Frankly, many of our customers are already utilizing it, while other customers are certainly evaluating it as a part of their future. I don’t believe that dynamic signage will become a complete solution for signage and graphics as we now know it – but I do believe that our customers will continue looking to dynamic signage as a complimentary solution to current signage needs. We’d all be wise to spend some time determining whether or not it makes sense to focus on this expanding industry as a part of our business model moving forward.
Just say ‘yes’ to evolution
As the aspects of our industry continue to change, we have the choice to view that change as either a detriment or an opportunity to our own businesses. Yes, it would be much easier to just focus on doing a good job on the products that we currently offer our customers, hoping that model will provide long-term success. But, realistically, we all need to do more. To remain a viable and competitive business, you must evolve.