During good times, we all get fat. Not necessarily body fat, but more specifically, business fat. When business is good, we tend to ignore it, and it continues to accumulate. Kitchen and bath professionals concentrate on sales and ignore the numerous small things that are likely affecting their kitchen cabinet costs. But, at the time, they seem so minute and insignificant, and sales are so good, it’s easy to postpone dealing with them.
When the economy isn’t as giving, businesses have to make sacrifices. What have you had to do since the downturn to keep sales going and your business profitable? Here are some things that have affected others. At the time, they may have been painful. But, as time passed dealing with such issues was actually beneficial.
- Layoffs — You may have had to bite the bullet and lay off employees. It can be tough but, as times changed, you found that they weren’t so necessary. The business continued and parting with them actually made you more profitable.
- Inventories — Your range and amounts of cabinet styles may have gotten out of hand. You had to take a hard look at what was selling and what wasn’t. Once you moved out certain styles, they were not re-ordered. Your inventory became smaller and you found that you were saddled with less damaged product. It had a beneficial effect on your losses and your overall kitchen cabinet costs.
- Utility Expenses — You may have determined it wasn’t necessary to heat and cool your stock area, and that turning half the lights off in the showroom actually showed off your cabinet line better and was easier on the eyes. It certainly helped your bottom line.
- Advertising — Advertising can add a noticeable amount to kitchen cabinet costs. Looking critically at the costs of various mediums, comparing their effectiveness and reach was necessary. Your costs to stay in the public eye had to be scaled back to the most productive. These days, blogging and social media have proven to be effective, and a business card in the right place can even have a better effect than an expensive billboard on the wrong highway.
- Customers — You and your staff may have found that correctly qualifying leads and using your valuable time on those qualified customers paid off. Instead of wasting time (time is money) on unqualified leads, you were able to ween the unfit out early and get back that wasted time.
By trimming away the fringe items that really weren’t needed, you most likely lowered your overall kitchen cabinet costs. The guy that you let go was nice, funny and personable, but always had mediocre sales. The newspaper lady was nice, but the ads weren’t effective. It’s always rough, but when it comes down to it, it probably helped cut those utility bills and damaged goods in half, right?
The after effect
So now you have trimmed down to a manageable weight, but the question is, can you keep off those excess pounds when sales pick up? Or are you destined to put back the lost weight, and maybe more, heading back for second and third helpings of bloated staffs and unnecessary spending.
Now that you have become lean and survived the challenges that sent your slow and sloppy competition packing, resolve to stay that way. Take the hard lessons learned and apply these new-found efficiencies to your business, even when sales start to climb. Treat those few extra dollars in the bank as your last meal, avoiding the temptation to “pig out” now on another sales person or a big newspaper ad.
Almost everyone has to diet at some point in their life. If you have built better habits, you can keep the pounds off.