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| Your Gameplan for Success! |
July 28,2008 |
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Greetings!
This issue is dedicated to "Simplicity, and Focus"! It is easy to get off track, complicate and lose focus on your core business goals. Writing these newsletters helps me as much, if not more, than my readers!
Stay tuned to these newsletters, pay if foward by passing it on. I am putting together some exciting events, book clubs & other educational and fun seminars. Talk to your VP of programs at the NKBA, have me come out and speak to the chapter.
If your resources are in short supply, then expand your resourcefulness! Dig deep, think outside the box, and remember "what you focus on expands!"
Please share this newsletter by forwarding it to a colleague or associate that you know. Thank you.
Have a profitable week!
Robert Foltz, CKD
954 683-2565
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Complicate your Designs if you must, but SIMPLIFY your business!
Everyone raise your hand if you have ever sat at a seminar and the speaker said "today's consumer is more educated than ever". Consumers are more educated and the Internet has made it ridiculously easy for them research you, your product, compare pricing and determine value. The sooner we realize that the better. I like to say we are going from the information age to the "recommendation age".
That's why you need to simplify your processes. The more you simplify your business model, the more your designs can be complicated! Execution of even a simple design is difficult in a complicated business structure. (Look at the big box stores for leadership in this regard) However, have you noticed how the leading design firms in your market execute complicated designs flawlessly? That is because their business systems are simple, uncomplicated and easy to explain, leaving the prospect focused on the "awesome design". We all know that if the prospect thinks you have "hit a homerun" on your design for them, then the price moves much lower on their list of priorities.
The three most important areas to simplify are: clearly defined Services, clearly defined product niche & uncomplicated pricing models. Add a quick turn around qualifying technique and your business model will be simple to present and execute, leaving you more time to play with the design.
Clearly defined services offered is the first key to simplification. Define what your company will and will not do. Limit what you do to what you do well. Period. A top ten firm in my market in Florida will not do countertops or construction services of any kind. Period. A top firm in the Colorado market will not install the cabinets. Period. Both have dominated their markets for decades. If you offer construction, then have charts that show the project timetable quickly, efficiently and that are easy to understand. The prospect will see what you do quickly and decide if it is a fit for them. ( Caution: Changing your procedures just to gain an important sale often leads to problems later. Test, retest new procedures first quietly before introducing them to the market). Do not risk your reputation unneccessarily.
Clearly defined product niche is the next key to simplification. Identify your market and your ideal customer then find the products that fit that market and customer. Have one product line for each price point. Too many dealers have many product lines that they rarely use just to get that "awesome linen glaze" that their major product line does not have. Or a Sales/Designer you just hired insists on adding a cabinet line because s/he knows it so well. A good Sales/Designer can sell anything and will take the time to learn your products. If your average Kitchen Cabinet Sale is $20,000 for 30 "boxes" installed, then have additional products that will do the job for $15,000 and $25,000 installed. A minimum of 15% to 25% spread between lines is what should be the key. Most of your display space should be dedicated to 3 or 4 cabinet lines and product niches. A "Good, Better, Best" scenario is easy to explain and illustrates the value to the prospect.
Uncomplicated pricing models are the third key to simplification. I had a big developer tell me once-"You should be able to estimate the cabinets installed in my houses in 30 minutes and be within 10-20% of your final bid". At first, I thought this would be impossible, but I learned how to do just that, and it is a great method for quickly qualifying your prospect.
Later, I had a "bigtime" interior design firm ask me to come to their office and "pick up some plans" to bid on a project they had. I sat down in her office, did my calculations based on the work she requested, I filled out an estimate form and a 10% Design Deposit Request all within 30 minutes! She was shocked and asked "What, you are not going to do any drawings?", I replied "You know my work and I know your style, so, with the door, finish and wood specie you requested the preliminary investment parameter is between $30-45K , installed with our usual amount of great accessories". I have had my designs stolen, copied and even won awards I was not aware of by unethical interior designers who passed my work off as their own and then bought cabinets from a competitor. This method of deposit first, design second is the same method used by most interior designers and their clients, it works well for our industry too.
I call this the "recommendation age" because your reputation and your references are easier to track than they have ever been before. Your business should be able to quickly explain how you differ from the competition. Offering a good, better, best scenario and an easy to calculate pricing formula for your prospects will not only save you time, but it will separate you from the pack in the marketplace. It will help to focus on the customers who will make you more money. I think the veterans of our industry agree, knowing when to walk away is as important to your business is picking up the check.
Knowledge and Clarity is Power!
Thank you
Robert Foltz, CKD
Kitchen Sales Coach
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What you Focus on Expands!
The tale of two companies
The Law of Attraction a principle that I have learned, everyone agrees with and most think they practice. However, let us do some soul searching... Do you blow off new representatives or sales people that come into your office, because "you're too busy". Do you forget to make time for your employees or designers when they have questions, or concerns?
What you reap is what you sow! If you're spending valuable time worrying about a light bulb that costs too much, or, spending hours negotiating a price savings of $50 when you could be generating a $5,000 sale -what kind of prospects and clients are you attracting? This is not a lecture, I just want you to think about your approach. Focus on sales, manage your costs.
Let me tell you a tale of two companies to illustrate my point. These are actual companies, and their principals do not even know that the energy the create, they get back each to a very different effect.
The owner of the first company was complaining to me about how hard the cabinet business is. After digging into this, I found two things. neither the owner nor the other principals have any experience in the kitchen business. They do not understand the complexity of the business and managing client expectations. They are constantly putting out fires, instead of having systems in place to prevent the fires. And they treat their vendors like garbage. Running them down, not paying the bills and then wanting free this, free that! Price, Price, Price.
This business is not undercapitalized. Yet they value haggling and getting something for less. The result is it attracts other CHEAP prospects! Not only that, but the good reps in the area will not even walk in the place, so who are they stuck with? - the problematic companies and reps in the marketplace. This owner is focused on his cost and how much every lightbulb is running up his overhead. Meanwhile, the sales staff is tired of all the yelling, unmotivated and the negative energy is incredible. Treating others in business like you want to be treated is natural law, and you will attract exactly what you put out What you focus on expands.
The owner of the second company has one concern-Sales, Sales, Sales. He never compromises on his profit margin or what his company does. He does not deviate from his business plan, nor have to justify his price. He recruits and pays top dollar for top talent. He works them hard, and is very demanding. He once told me, " I want people to be their best, so sometimes I need to push a bit" Everyone in the organization pushes sales and excellence in project management. From the Installer to the Designer to the Back Room Staff, they all know that only 100% of their best will do. When mistakes happen, no one yells or gets mad, they fix it, learn and move on. If he finds value in a new display, of course he will ask for it for free. If it is not offered, he justifies the value. Value for this owner is "How many sales will this product bring me?" The reps that deal with him have to make an appointment, be brief, and bring value. Start talking about the football game or whatever, and you are wasting his valuable sales time! He focuses on Sales and monitors his cost.
The Law of Attraction is real and alive in the Kitchen Business. If you are unethical, mean, nasty to your vendors, then you will only attract like minded vendors and their reps. Same for staff and clients. Problems create Problems because they attract Problems.
Business in Florida is not what it was, ok. I have to keep reminding myself and my clients that if we focus on what we do not have, we will have more of it. If we focus on opportunities, then we will have more opportunities.
Thank you and keep your mind focused on forward thinking ways to serve and add value to your clients!
Robert Foltz, CKD
Kitchen Sales Coach |
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Coming Soon!
Oprah's bookclub has inspired me!
(My wife watches not me--he he he)
Kitchen Sales Coach is starting a bookclub that is inspirational and will lead you to enlightened business experiences.
Green Articles that do not lecture, but educate and inspire!
I have found someone that is passionate, informative and cuts through the clutter about the subject. Look for his contributions in the next upcoming issues. |
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