Dead or Playing Possum?

In honor of Black Friday and Cyber Monday, and other big shopping days, here’s an opinion on the retail industry, trends, and sticking with it.

“What goes around comes around” is an old saying meaning things eventually return to their original value after some sort of cycle (and it’s a hit song by Justin Timberlake).

How long ago was it when every pundit and everybody you spoke with was saying “retail is dead?” Other comments included the Internet passed retailers by, the cost of stores is too high, people don’t want to shop, they want to get a package at their door, etc.

Guess what? A Wall Street Journal headline was, “Retail Stocks Roar Back On Consumer Strength.” The S&P Retail exchange-traded fund was up 16% this year at the time of the article and many major retailer stocks were up 30-50% this year (and are bouncing around like all other stocks). On September 4 The Seattle Times had a business section headline of, “Retail trends drawing shoppers into stores.”

Retailers seem be figuring it out. They took a hit, regrouped, found where they can shine, and appear to be doing so. Some of their tactics are new and some are the same as before including racks of clothes, fitting rooms, private brands, personal assistance (think Nordstrom not Walmart), etc.

Think about this in regard to your business. You can jump onboard with the latest greatest software, marketing program, manufacturing scheme, etc. but I’ll bet there are things you do the same way as before (or come back to them), because they work.

I recently spoke with the owner of a company that bids on jobs. I asked if they used any industry software or ERP system to bid. The answer was no, they use Excel and Access, because it works for them (to me working means the bids are right and they make money on their jobs). I’m not sure how time-efficient it is, but it works.

I remember from a past business life an industry leader talking about a marketing program and saying something like, it worked so well for so long we decided to do something different. If it works, keep doing it, but always look for ways to do it better.

“There seems to be some perverse human characteristic that likes to make easy things seem difficult.” Warren Buffett

Somethings are Just Out of Our Control

Two weeks ago, I received a couple positive comments about the memo sent that morning. A few people noticed it was dated September 18 and was the same content as the September 18 memo. So, I investigated.

For background, my process is:

  • Take a recent memo.
  • Delete the content.
  • Paste in the new content, link a different video, and change the date.
  • Send a test message to myself and edit if needed.
  • Schedule it.

First, I went in the Constant Contact system and yes, the memo dated October 9 was the one from three weeks prior. Second, I checked the test message I sent myself, and it was what was supposed to go out October 9. So sometime between the test and the scheduling the system reverted back, with me not having any way to know it.

Normally I would say these things happen because of human error (meaning I screwed up) but my test was correct and I also had my (almost) monthly newsletter scheduled to go out on October 11 and received an email from Constant Contact the next day saying technical issues prevented if from going out (with a lot of apologies in the message). Therefore, my assumption is, their system was at fault.

Things happen and some of them can’t be controlled. We have random acts of kindness and random glitches. You have to roll with the circumstances. The downside was I repeated a message. The upside is people noticed and I get to write this explanation. The old adage, control what you can control is true. Make sure you control enough to be effective.

“Control what you can, confront what you can’t.” (The band) Maine

Asking Why – A Great Question

I’m known in my family for constantly asking, “Why?” Others will say something about what they’re going to do, what they want to get, etc. and I’ll ask, Why?

Sometimes I get the answer, “Because.” And no, that’s not a reason why you want to do something.

  • A client told me if he had the money (at the time) he’d like to buy a larger machine. Why? It turns out because he likes big machines, not because the business needed it.
  • Years ago, one of my clients bought a business with way too much inventory. Why? Because the owner loved seeing full racks of stuff (and those full racks turned into cash with better management).
  • An owner had way too many employees. Why? Seems he didn’t want to work too hard, so he didn’t pay attention, and therefore made less money.

A client of mine, in a buy-sell deal, made it a (conscious) point of avoiding the why question by giving the answer in advance. For example, “This information is needed by Friday because (let’s say, to keep the bank on schedule).”

It’s a great simple one-word question to ask about marketing tactics, purchases, hiring, and much more.

“Even the smallest act of service, the simplest act of kindness, is a way to honor those we lost, a way to reclaim that spirit of unity that followed 9/11.”President Barack Obama

 

If You Want To You Will

I caught a small amount of the NFL Hall of Fame ceremonies on TV and was particularly drawn to Jerry Kramer’s acceptance speech. He mentioned how his high school line coach, after noticing him struggle, told him, “You can, if you will.”

At first he was befuddled by it. Then he figured it out, got a scholarship to the University of Idaho, won five NFL championships, was on the NFL’s 50thanniversary team, and now the HOF.

We can all, “Figure it out.” Now I can’t be a surgeon, engineer, lawyer, etc. but I’ve figured out how I can help others, be successful, contribute to the good of the whole, and have an enjoyable life – if I will do what it takes. One of my favorite lines, to clients and others, is, “If you do the things you’re supposed to do good things will happen.”

It doesn’t matter what your vocation, the above applies. The same holds for what you do with your family, community, and elsewhere. But it does take effort, perseverance, and (especially these days in our ever-faster world) urgency.

Kramer ended with some motivation from his coach, Vince Lombardi, which is the quote below. Sports, business, family, etc. all will thrive if you’ll do what you’re supposed to do.

“After the game is over, the stadium lights are out, the parking lot’s empty, you’re back in the quiet of your room, the championship ring on the dresser, the only thing left at this time is to lead a life of quality and excellence, and to make this old world a little bit better place because you were in it.” Vince Lombardi

Trust Versus Prospecting

I am getting really tired of people asking me to connect on LinkedIn and then prospecting me. What looks like a networking connection turns into a solicitation, without any knowledge of if I need, want, or are even qualified for what the person is offering.

Does it work? I don’t know but it seems like it’s the same as a cold call, a very cold call, and we know the low success rate of cold calls. Most people on LinkedIn are in some kind of relationship business and this is the complete opposite. You get to be a trusted advisor by earning trust.

When All Employees are on the Same Page…

At a meeting with a group of clients last week our presenter, my friend Hugh Blane, asked an interesting question – “Can every employee articulate your strategy and their role in accomplishing it?” The question stumped a few people and in a test phone call to one client’s company the manager receiving the call was a bit indecisive with the answer. It’s a good exercise to make sure employees, especially those who have customer contact, know the firm’s strategy and value proposition.

Know your market

We have some house guests, a young couple from Ecuador, he having been an exchange student of ours a dozen years ago. On May 8 I showed them the front page of the Seattle Times and an article about how a survey showed the high cost of living is the number one thing people don’t like about the area (taking over the perennial top item, traffic). Cost of living really means the cost of housing.

She read the article, saw how home prices are going up about 15% a year and commented how people will be rich if this keeps happening. So I gave her a short lesson in economics.

  • Just because the price goes up doesn’t mean it’s money you can spend.
  • What goes up can go down, as we saw 10 years ago.
  • When the home prices go up so do your property taxes. Ours went up about 15% this year.
  • And, someone has to be able to pay the high prices and there’s a limited number of people who can afford the high-end homes (median home price in Seattle is $819,000 and on the Eastside it’s $943,000), especially if prices keep rising. Well-above market priced houses take a lot longer to sell in our neighborhood.
  • If you sell, you have to find somewhere else to live (and unless you plan to move out of the area you’re paying a high price for a new place).

The above (especially the fourth point) applies to our everyday businesses also. The larger the size of the firms in your target market the fewer there are, i.e. you have a limited number of customers. According to Hoover’s (D&B) and NAICS.com only about:

  • 4.5% of companies have sales greater than $2.5 million
  • 3% of companies have sales greater than $5 million
  • Less than 2% have sales greater than $10 million

In addition, about 90% of businesses do less than $500,000 in sales.

Bottom line, you have to know your market. It doesn’t matter if you’re selling widgets, advice, service, or anything else. I know in the buy-sell world it gets more competitive as the company and deal sizes get larger; just look at what’s going on in the Private Equity market where acquisition prices are getting ridiculously high.

When it’s competitive, it’s when service plays a big part. It’s where small business shouldthrive by being caring, nimble, and fast. The continually profitable companies recognize and do this.

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The Robots Are Taking Over

“Say goodbye to your bank teller and your insurance agent” is the opening line of a just released Fast Company article titled, “AI Could Kill 2.5 Million Financial Jobs – And Save Banks $1 Trillion.”

Google just announced the launch of “Duplex,” an AI application that can call and make appointments for you with the party on the other end of the line thinking it’s a human. There’s a resume scanning program that can review 1,500 resumes an hour (good luck to job seekers trying to stand out in the crowd).

Fast Company based their article on research from the firm Autonomous that recently issued an 84-page report on this and predicts:

  • Software agents (machines) will hold conversations with clients.
  • AI will oversee the ever more complex regulations department with real-time oversight of the company’s actions.
  • AI will determine credit risk, insurance underwriting, assess claims damage using machine vision, and select investments (don’t investment firms already use computers to time trades?).

Over half of what I do with/for my clients is advise, counsel, and provide quasi-therapy versus analytical work like spreadsheets, reviewing documents, etc. I think we’re a long way off from when machines can offer the “personal touch.”

Maybe they will replace some jobs like insurance agents or claims adjustors. But I wonder how many people will really want this. It, again, goes back to John Naisbitt’s statement about how the more high tech we get the more high touch we’ll need. Interesting times indeed.

“The use of life is to spend it for something that outlasts it.” Willam James

 

Peace of Mind? Priceless

Ten and one-half years of owning an iPhone and a freak accident gave me my first broken screen. I had the phone in my jacket pocket, put it over the back of an office chair with a fancy metal design around the back, got out of the meeting, grabbed my phone, and found a beautiful design radiating up my screen.

Replacing an iPhone screen is not cheap. So I bought a tempered glass screen cover with a lifetime guarantee. Pretty cheap compared to this happening again. One could say it’s a form of insurance.

One could say many things we do in life are a form of insurance. We have our attorneys do things to keep us in compliance and out of trouble. Our accountants make sure the IRS or, heaven forbid, the State DOR doesn’t come after us. A good banker keeps you not track versus just lending money (to anybody).

And of course, people like me in an advisory business give our clients peace of mind, ask the right questions, let clients know when they have the right answers, etc.

The cost of a bad contract, erroneous taxes, or a bad business decision is huge. The cost of someone who’s seen the situation hundreds of times and knows what to do, and not do, is virtually priceless.

It’s why we all have businesses.

“If you don’t have a seat at the table, you’re probably on the menu.” Elizabeth Warren

 

Faking It Doesn’t Work

My wife and I are big fans of the show Diners, Drive-ins, and Dives with Guy Feiri. In late 2017 there was a spin-off show, Guy’s Big Project, to find the host and concept for a new, similar, show showcasing certain types of restaurants (no spoiler alert, just that it’s a fun show with a surprising ending).

They started with 10-12 contestants and eliminated them over a number of episodes. When they got down to the final group they had them prepare a meal and present it to a group of celebrity chefs.

One of the contestants booked himself as being weird (and it seems he is a bit weird). What the chef judges didn’t like is how he “tried too hard” to be weird. Weirder than his normal.

There’s a lesson for all of us in this. You have to be yourself because when you try too hard you’re faking it and others will notice. It reeks of insincerity. You can’t be like your boss, father, mother, mentor, coach, or anybody else. Just because your boss wears ugly ties doesn’t mean you should.

Be yourself, it works.

“There are no traffic jams along the extra mile.” Roger Staubach