Do you have a plan in place to grow your business into the future? Today’s business environment is much more difficult to survive in and proper planning will ensure your success. If your business is failing or just barely getting by, it is likely that you do not have a written business plan in place or if you do, you probably don’t review and update it on a regular basis. In the past, you could get away without one but that is no longer the case, business is just too competitive these days. Remember that failing to plan is the same as planning to fail. You need a clear roadmap to determine where you are going in the future and these plans must be communicated and embraced by all of your employees.

 

Once you have a written plan in place, you then need to create a cash flow forecast and determine if you will be profitable with this plan. This also gives you something to measure against to see if you are actually achieving your objectives. This should also be backed up with market research to ensure that you are heading in the right direction and there is plenty of research available on the internet and through industry groups.

 

If you are considering buying a machine and complete an ROI (return on investment) consider this as only the first step. If you have the ROI supplied by the company selling you the machine be very leery of the data supplied. Do your research and be sure ahead of time that this will succeed. Suppose you look at buying a new Heidelberg to replace your existing equipment. You might want to forecast what your sales will be in the future and actually talk with customers to find out what their opinion is first. Any large outlay in cash should be carefully considered because most marketing research data shows that offset print is in decline and wishes will not turn that around. Same thing goes if you are considering a move into digital printing but as well, you have to consider the additional skills required for not only the operation, but for the sales force as well. Adding digital is a fad these days and does not guarantee success so remember that even though many companies have added the capability, they have not necessarily learned how to leverage it in today’s market.

 

Marketing research data is not always right. There are many cases where the data cannot exist because nobody knows about the technology. Who would have guessed that a mobile app would be able to generate $100,000 in revenue per day within 6 weeks of launching? Draw Something has achieved that with over 12 million daily users. Although it may look like app development is the way to go, HTML5 may just render app development as useless. Who knows, marketing research could not possibly predict this either way. Research data also does not take into consideration emerging technology that would wipe out existing technology, especially if they do not know what is coming. If Steve Jobs had relied on research data, Apple would never have become what it is today. That takes a different skill than what most people possess and it is not something that can be learned. Either you have it or you don’t.

 

Another critical factor is the support of the organization. Without it, even the best plans and ideas will fail. The plan needs to be properly communicated to everyone involved and that message has to carry out to the market. Everyone in the company needs to be on board so the plan has to include them and you need to demonstrate how the plan will benefit them. Not always an easy accomplishment in a traditional environment with older workers who would rather not learn anything new. I remember the days I was trying to convince film strippers that they needed to learn how to use a computer. Some people just need to lose their job and search the job market before they realize that you were right.

 

If you don’t know how to create a business plan, there are plenty of resources available to help with this. Most communities have a business resource centre and there are always plenty of consultants available. Just remember that many of the consultants are not forward thinkers and you want to check their background to make sure they are the right person for you. A turnaround consultant will smash your business to pieces so you want to avoid them…unless you are looking to close down.

 

While you are putting your plan together, you will be pre-planning every conceivable issue that could arise and be prepared for anything. This is when you would set up your pricing structure, predict your potential sales, assess the human resources required to carry out the plan, construction, marketing, training and anything else involved. Once you see the numbers, you will know whether or not you should proceed. If you can’t sell yourself at this point it might not be such a good idea. If you forecast a loss of $100,000 would you rather know before you committed or a year after when it becomes a reality? Maybe a loss in the first year is to be expected and that is the road to $500,000 profit in 3-5 years. That is what long term planning will show you.

 

Once you have your plan together, it would be a good idea to run it by a few people who can verify your numbers and assumptions. Your mom might not be the best person for this (unless she is an executive with experience) and your buddy might not be either. You need the advice of a seasoned professional who can offer an opinion and you will be looking for someone who might be highly critical and challenge you on your data. This is a good thing because you want to be sure before you move forward. Make sure you pick someone you can trust.

 

Remember the 6 P’s – Proper Preparation Prevents Piss Poor Performance

 

No plan? Failure is in your future!

 

By 2020 there will be billions fewer consumers at their peak spending than there were in 2007.

The world of manufacturing has been good for many of us. It has provided good, medium term employment for many people and has served a great purpose. In our quest to keep up with growing demand, each of us fine tuned our businesses and took many steps to becoming as efficient and lean and mean as we can. We cut out as much manual labour as we could and we were all prepared to take on the world. But now it seems that the world has turned off it’s demand for our products.

In our quest to build a better business, we forgot about the most important element in our business, the consumer. Yes, I understand that everyone is “customer focused” and tries to relate as best as they can to the customer but that is different than the consumer. Consumers are those people with jobs and money to spend on all those great things that we make. Each and every time we eliminated a job due to improvement we killed another consumer.
Don’t get me wrong. Becoming more efficient was an essential part of the process. It is what every company in every area of manufacturing had to do just to survive up to this point. What I am saying is that each and every job that was eliminated was a consumer that was tossed away like an old diaper. We wanted nothing to do with the consumer (old employee) and we left them with nothing but the experience. As we modernized and became more efficient we eliminated our workforce with no regard for what these people were going to do. We forgot to remember that these people were also consumers. We decided that it was somebody elses problem to deal with so nobody did anything about it.
The mistake that we made is that we eliminated the majority of our workforce over the last several years and did not create new jobs for them. When we eliminate our workforce, that workforce is also the consumer base so we are basically eliminating customers every time we eliminate a job. New job creation has been at the bottom of the market with part time hours and minimum wage. With the employees that are still working, most of them are working at a much lower rate than what they previously earned and are doing much more work than what most people used to. The majority of people can barely afford to pay for the stuff they already have so they are not out spending on new stuff.

The boom is over

The baby boomers who drove the economy for years have started to retire. Many of them had their retirement savings cut to less than half when the market collapsed in 2008 so many of them cannot afford to spend like they would have. Many who planned to retire have had to extend their working lives passed their retirement dates because they can no longer afford to retire. The boomers have done their spending and it will be another 10 years before a comparable sized group does their spending.

Business as we know it is doomed…to evolution

I say that because too many people are stuck in the belief that the current system is still OK and things will magically rebound to “the good old days”. I am here to tell you that if you are hanging in there waiting for the turnaround, it’s time to give up to the reality that surrounds you. There is a major flaw in our business world that has not been addressed and until it is, things will just continue to get worse. You can see the flaw in the mantras of almost all companies. You can see the problem looking right in your face but you still cannot see it. It is all a matter of perception, what angle you look at it from.

CASH IS KING!

One of the most essential elements to any business is the consumer. Yes, this is the end customer who actually buys the finished product. These are also the people who consume the product through the entire chain. In order for everyone to have good sales, the consumers have to be buying lots of product. If the consumer stops spending money, then that means that they stop buying product and then every one in the entire chain is affected by lower volumes. Less demand = less sales.

Why has the consumer quit buying our product? Our product is a necessary part of everybody’s life so why wouldn’t they need it. The consumer quit buying the product for several reasons. The first and most obvious reason that they quit spending is because we put them out of a job. Yes, the consumer is also your employee. Each and every time that we automated and advanced our craft and removed the manual labor, we neglected to take care of the consumer and make sure they were taken care of so that they could go on spending. We we eliminated jobs and we did not create new opportunities for these people so that they could remain consumers and continue to fuel the need for product.

Why was it that we had to reduce our costs and eliminate those employees, who were also consumers?

We did not decide for ourselves that we needed to reduce costs, we were told to do so by the market. It was the customer who had to keep cutting costs to remain competitive in the market. The market is the consumer of our products that we create and the consumers decided that they want to buy the cheapest product they can regardless of the cost. When the consumer walks into a store and makes a purchase based on price, that is the signal to the producers to reduce costs. We do that by eliminating the cost of manual labor, we trim the consumer from our workforce.

It is true when we say we are our own worst enemy

It is our own purchasing habits and the concept of the cheapest price that has created our current situation. It is the disconnection that we have when it comes to price. If we picked products that supported local employment and good paying job creation we would be thinking about ourselves when we make our purchase. The corporations are only doing what has been demanded of them by the people who give them their money, the consumer and their investors (who are usually our RRSP fund managers). Every time we automate a process and eliminate an employee we kill a consumer at the same time. With each and every consumer that is eliminated it gets a little worse and so more consumers are killed off. Replacement jobs are usually taken at far less pay. Those of us who are left start feeling the pinch and start lowering our cost of living. We do so by buying cheaper stuff. The cheaper stuff they buy requires the killing off of more consumers. It’s like Russian Roulette when you make a purchase today. Which one will eliminate your job?

So when are things going to turn around and come back?

Not until we start showing leadership as companies and start to consider the health of our consumer. There is no consumer loyalty because there is no corporate loyalty to the consumer. The consumer only sees greed. Until people start getting good incomes that do more than cover their basic needs, consumer demand will continue to fall. Find a way to put income back into peoples pockets and they will start spending. It can’t be like in the past, it needs to be something new and sustainable and without greed or corruption. We can wait till the system crashes, or we can choose to start rebuilding by re-thinking how and why we do business. It is time to change…

The future is ours to create

 

With Eastman Kodak on the brink of a restructuring, many people are wondering what the future holds for them. It is likely that they will get some cash for some of the patents that they hold and many of those patents will allow for advancement in technology that Kodak has been holding back from the market. This will allow Kodak to survive for the short term, but the future as it stands is pretty bleak for them. Their current situation is completely their own fault as they hung onto the past for far too long.

Eastman Kodak’s core product have been film, chemistry, print paper and printing plates. Their key markets are printing, photography and medical imaging. All of those markets are now eliminating the use of film with medical imaging the last to transition. Most of their sales have disappeared with the remaining sales making it difficult to operate efficiently. Kodak had a share price around $80 but is now below 50 cents. Pretty scary times for a huge company on the brink of collapse.
As a Kodak customer, I always kept close tabs on their operation. I worked with cameras , developing film, litho stripping and platemaking (all part of the printing process). Our invoices from Kodak were enormous, but of course, that was always passed on to the customer. The development of emerging technology was something that I always followed and there were some exciting developments that were under way and then dis-appeared. Sometimes the developer would run out of money or support, sometimes they would be bought by bigger companies, some were shelved and many actually developed into products. What I noticed with Kodak’s involvement with these technologies was that they made an effort to hold back advancement and tried to keep the film business alive for as long as possible. One of the products that I was watching develop was a product that was sprayed onto a press cylinder and then imaged directly on the press. No more plates. Kodak bought the technology and it disappeared.

Cash is King

Kodak has an obligation to it’s shareholders to consistently grow and do everything in it’s power to protect it’s business. They had a choice between leading by developing new products and markets or to hold and protect their existing business. With the emergence of direct imaging, Kodak was starting to lose sales with every improvement made in the industry. As a leader in the change to computer to plate, it seemed like they were working towards sabotaging it’s development. I found that Kodak reps spent a great deal of time developing relationships with printers and they all seemed to carry a programmed message that they delivered to the printing trade. This is one of the reasons that the printing industry took so long to transition, because many printers did not believe it was going to work or that they were capable. Kodak helped to nurture the fear of change and keep the customer focused on using as much of their product as possible. The attitude was that computer to plate was complicated and too hard to accomplish. They talked about the difficulties instead of successes and they had an attitude that anything outside the scope of normal was impossible. I was often told by Kodak that the issues I had with their products were exclusive to me and that I should tone down my expectations. They wanted me to drop high resolution printing and stick with the standard 150 line-screen. Since I was in contact with many others who were like me, I found that many others were told that they were also the only one having problems as well. In order to effectively hold everything back, the whole sales organization had to believe it to be true and so the whole culture within Kodak would have to be trained & would continue to hold onto that belief. Kodak has been so focused on stopping change that the attitude required to turn things around is simply not there. They shut off their ability to change in order to keep everything the same and it (the ability to change) is a difficult one to get back.

Kodak needs someone with vision to review all of their patents and technologies and create something new. They have the tools but don’t seem to know how to use them in today’s world. Their business model does not fit in today’s society and it will only get worse with progress. Kodak needs to start considering the health of the consumer and find something that can help them. The consumer does not need Kodak and has no loyalty to them. Why should they? It’s time to start putting the consumer first and solving their problems. Forget about everything you know and create a new way instead of trying to catch up. Lose the box that contains what you know and what you can see and present something new that everyone will want.

 

I grew up in a family business and made the decision to leave 2 years ago. It was a tough decision because I had spent over 30 years preparing to one day take over the family business. There were a lot of things that went on over the years to lead to my decision and 2 years later I have a different understanding about everything that lead to the decision. Family business succession is one of the hardest phases for any company. Failing to come up with a plan is planning to fail. As a family, we could not agree on the future path of the company and the company was suffering because of it. The only way to end this battle was to leave the battle.

I have gained a lot knowledge and skills in my time at Advance Printing. Having 2 years to work out everything that I experienced has given me incredible insight into relationships and how they evolve over time…on all levels.

I will be writing about the things that I learned. Hopefully I can help others who might find themselves in my position and give them clarity so they can make better decisions for themselves.

Dec 092011
 

The power of the 6 P’s

Proper Preparation Prevents Piss Poor Performance

A business without a plan is like a boat without a rudder or leaving for a trip without a destination. Sure, it can be a real adventure and you never know where you are going to end up. The key to long term growth and profitability lies in the planning stage. If you map out where you are going and how you are getting there, then everyone can follow the plan to help get you there. Once you know where you are going, then you can measure to see how you are doing against your projections. If you are not on the right track then you need to make adjustments. If you like your plan to be flexible and ready to adapt to changes, this is achievable with a plan. You can review and adjust the plan on a regular basis if you like, even on a weekly or monthly basis if need be.

Practice

I can’t remember who taught me that but I have lived by this ever since. Spend as much time learning and practicing as you can. What makes someone good at anything they do? Lots of practice. Why is Neil Pert one of the best drummers in the world? he practices more than everyone else. This is one point that many people miss. When they learn enough to be good at something they quit learning and live life wondering “what does it take to be good?” Lots & lots of practice. We are talking about 1000′s of hours, not just a few. Once you get that good with one thing, everything else is much easier. You gotta learn new things and practice at all times.

Also known as the 7 P’s with Prior at the beginning.


 

© 2012 Print Dude Suffusion theme by Sayontan Sinha