Looking Up in a Down Market
Keys to ensure your business stays afloat through tough times.
Like most of the American economy, our industry is in a "world of hurt," and as this column is written, things don’t appear to be looking up in the near term. The economy has forced our own shop, Pictographics, to rethink everything and come to grips with our own inadequacies. Is every step in our manufacturing process, for instance, as efficient as it could be?
Ours was not, but we are working on it harder than ever before. Are there totally new ways of conducting business that we had not fully explored or implemented? We’ve begun exploring Web-to-print, variable-data printing, accounting, inventory, as well as work-order integration and workflow and customer-service automation. Other questions we’ve been asking ourselves this year include: What products should we abandon? What existing products need to be improved? What new innovative products are worth the cost to develop?
Of course, the urgency of this economy has focused and accelerated our efforts. We have gone through this exercise once before and came out of it a better company: The economic repercussion of the events of 9/11 nearly put us out of business. We survived, however, and then thrived by diversifying our markets, products, and services; and we adopted skills and technologies to differentiate ourselves from our competitors. It’s now time to do it again.
The customer side of the equation
Ironically, good times can have a dulling effect on imagination, resourcefulness, and competence; people can even get by being downright stupid. This applies to our customers as well as print providers. I wish I had a nickel for every time I have proposed a more effective or money-saving option to a customer only to hear, "No, this is the way we’ve always done it." But it’s amazing how much smarter customers are getting this year.
Let’s say you’ve been doing business with a big client, BT (for "Big Time"), for a while. BT makes the best widgets in the world and dominates every market where widgets are sold. In the past, this customer thought nothing of dropping $10 million on a single trade show and it exhibited at multiple shows a year. In 2008, however, the markets that bought their widgets are all in deep recession and BT’s sales have plunged. BT marketing managers know they still must have a presence at every major trade event, but now they are reluctant to spend money and they have to justify every cent. They just got smart.
Guess what? BT marketing managers will now listen to proposals that promise cost savings. They are even more concerned about their image in this hyper-competitive time. They are interested in having serious discussions about "bang for the buck" and innovation. Fearing the loss of this business, your staff scratches their heads and comes up with an idea for a hugely cost-effective way for BT to keep its "Big Time" image at shows. This now-smart customer buys the whole package.
In fact, BT not only enjoys an overall cost savings of half, but your net profit from BT doubles at the same time. It’s a win/win situation. The customer spends less; the innovative print shop gets more. This happy ending may not have been possible when the customer was "fat, dumb, and happy."
Swimming to shore
If you look at your current situation and determine that your company might be at risk, you may want to look at the situation like this: Imagine you have been dropped in the middle of a big, remote lake without a life vest. The chances of being rescued by someone else are slim; therefore, it’s strictly up to you to get out of this perilous situation. You are faced with three choices: Swim forward to what you judge to be the closest land and salvation; tread water and hope for the best; or say "Oh well" and drown.
To me, the best choice is obvious. Doing nothing and drowning is not an option, although I’m surprised by how many times I have seen this "strategy." Treading water is at least going through the motion of staying alive-and you can hope someone will save you if you keep your head above water long enough (or the lake will drain, or something). To me, however, the odds are not with you in simply trying to tread water in this scenario.
Your best bet is to swim forward. It’s true that even if you choose to swim, there are still no guarantees. You could miscalculate what direction to go and swim away from shore. could run out of energy before you reach shore and drown. But determining a course of action and actively seeking a positive outcome is the right decision. Plus, the strength, skill, and confidence you’ll gain by reaching shore may turn you into the entrepreneurial equivalent of Olympian Michael Phelps. The crisis may become a blessing in disguise.
Here is to all of us finding the shore-stronger and smarter than before.
Craig Miller is president of Pictographics (www.pictographics.net) in Las Vegas, a large-format-graphics service bureau that excels in digitally dyed textiles, wall coverings, and custom applications.