Business Strategy

Cash is King

October 13, 2015

by Mark Porter, Dienamic MIS Software Inc.

Controlling your cash is vital in today’s economy, but you also are probably understaffed and overworked – a perfect combination that can lead to missing items, which can greatly affect your cash flow. Therefore, it is vital to have checks and balances built into your operations that will help avoid bad customers, missed charges, paying too much to vendors and maintaining cash flow.

We aren’t looking at this topic from the accounting side since we assume that everyone has an accounting system in place and is watching their aging process. With this, we are looking at the management side.

Avoid bad customers

Debt from one bad customer can wipe out profit from a lot of good jobs. It is vital that you stay on top of COD and delinquent customers. These days, this information can be continually changing, and it is important that everyone is aware of a customer’s status. There is nothing worse then shipping a job to a customer on COD before getting the money or calling a customer to tell them you are holding their job back only to find out they sent you a check earlier.

Allowing management to make credit decisions on customers and to convey that decision immediately to other staff is very important. Management simply can flag a customer as COD or On Hold and immediately order entry people cannot open orders and shipping people cannot create packing slips without security passwords.

Chargeable changes

Profit margins on jobs are so thin these days that any extra work can turn a job from a money maker to a money loser. It is vital that you track your chargeable changes and collect on them from your customer. Implement a system that will document all changes made to the order from the time you agree to do the job until you ship that job to the customer. The changes should be date-, time-, employee- and reason-stamped. Change orders should immediately generate an email notification to the customers of the changes. These changes should be immediately reflected on the invoice but allow for changes at that time.

If you keep record of every change and document the reasons for the changes, you will collect your legitimate extra fees.

Start your aging as soon as possible

We all know that customers are going to take their time paying you whether that is 30, 60, 90 or 120 days, so the sooner you can start the clock the better. When you generate a physical invoice, automatically email a pdf copy of it to your customer at the same time. This avoids any delay in mailing invoices and allows you to collect your money days earlier.

Customers will want your invoice ASAP so that they can bill their customers and keep their cash flow going. You may not get your money any sooner, but you will become a more desirable vendor for them.

Don’t miss any jobs

Reduced staffing and hurried work schedules can lead to people doing things they forget about. Maybe a job is shipped and then your plant manager pulls the job bag to write something on it and then forgets to put it back in the billing file. Or maybe the job bag fell behind the shippers desk. The end result is a shipped job that isn’t billed at all or billed at a much later date when it is found, which is uncomfortable and embarrassing.

Run reports each Friday that provide a list of jobs shipped but not invoiced. Don’t let any hard-earned money slip through your fingers.

Don’t overpay purchases

Everyone makes mistakes, including suppliers, but you shouldn’t have to pay for their mistakes. By issuing POs, recording receipts and entering vendor invoices you can be instantly flagged when the invoice price varies from the PO and the quantity billed exceeds the quantity received. You work hard for your money – don’t give it away to suppliers.

Mark Porter is the president of Dienamic MIS Software. Dienamic develops and markets software solutions specifically for the postpress industries of trade binderies and print finishers. Dienamic offers estimating software, management information systems (order entry, shipping, data collection, scheduling, etc.), and e-commerce software designed to meet the specific needs of binders and finishers. Dienamic offers stand-alone modules for BHRs, die management, and receiving goods as well. For more information, call 800.461.8114 or e-mail mark@dienamicmis.com.

Reprinted with permission.

Top 5 Reasons to Fire a Customer

September 4, 2015

by Brittany Willes, PostPress

The customer is always right. We’re all familiar with the old adage and rarely think to question its authenticity. Sometimes customers are wrong, and some even create more problems than profit. When customer relationships no longer are mutually beneficial, it’s time to let those customers go. So, how do you determine if a customer needs firing? Below are some of the more common themes in bad customer relationships.

1. Unreasonable demands

Customers are demanding. Some will be more difficult to please than others. This doesn’t automatically make them bad customers; in time, they may become easier to work with once a sense of trust and respect has been established. There also are customers determined to be unhappy regardless of your efforts. You may find yourself defending the quality of your work or performing extra work outside of the original service agreement in an attempt to soothe perpetually ruffled feathers. Often, these are high-profile clients whom businesses are reluctant to lose for fear of lost revenue. However, given the extra time, effort and handholding they usually require, these customers are less profitable than imagined. If a client habitually costs you time and resources better spent on more appreciative customers, it’s time to let that client go.

2. Chasing payments

When businesses expand and develop, naturally the cost of doing business also rises, leading companies to increase their prices. Most customers understand this and happily will comply with the adjusted price as long as quality continues to be good. Bad customers will argue and refuse to pay the higher prices. Fear of losing customers, and therefore revenue, may prompt business owners to allow outdated payments. By not enforcing price increases for all clients, businesses ultimately will lose money as they struggle to satisfy unreasonable customers rather than focus on clients willing to pay the current rates. There’s no harm in negotiating prices. Everyone wants the best deal for the best value, including good customers. When negotiation turns into unreasonable demands and undervaluing your work, it’s time to draw the line.

3. Monopolizing time

Spending the majority of your time and resources appealing to a single customer means taking away from others. If you allow one client to dominate your time and attention, the customer will come to expect it. And, those clients who already value your work without making unreasonable demands on your time? They are the ones most likely to suffer and, therefore, to look elsewhere for service. This goes hand in hand with chasing payments. If you’re having to send multiple invoices and payment reminders, spending valuable time haggling with clients, this also detracts from time you should be focusing on good customers.

4. Compromising quality

Life happens, things go wrong and last-minute emergencies demand last-minute problem-solving. However, these times should be few and far between. If your clients routinely demand services within time frames that require you to lower the professional standards of your work, you compromise more than just your time. Performing rushed, low-quality work undermines the reputation of your products and services. This reflects badly on you and your client. The customer is right only so long as both of your needs and goals are being met.

5. Lack of Trust

Good customer relationships require a great deal of trust from both sides. Customers need to be able to trust their service providers to conduct themselves in a legal and ethical manner. Business owners need to be able to trust their clients to behave the same. If a client behaves unethically and asks the same of their service providers, the client needs to be fired. It may seem like an obvious sign of a bad customer relationship, but it warrants mentioning. When customers lack integrity, everyone suffers.

In the end, good customer relationships are built on mutual respect. If you feel that a client is not respectful of you, your employees or your business, it is time to let that client go.

Using Social Media to Promote Your Business

September 4, 2015

by Jen Clark, PostPress

Dina Lyon works on an animated video for Creative Coatings’ social media marketing campaign.

In today’s global economy, creatively marketing your business to potential customers can be the difference in winning a contract or waiting (and hoping) for the next customer to come through the door. Marketing in this day and age goes beyond having a company website. Creating a lasting marketing campaign with a return on investment (ROI) is an expenditure in both time and talent.

Using social media for business marketing isn’t necessarily a new practice, but for those in the printing and finishing industries it can be tricky to know where to start. A number of social media-related items are available on the Printing Industries of America’s (PIA) website. The business/marketing section of the PIA’s book store at www.printing.org includes titles such as Social Media Field Guide and Social Media Success. An overview of the Field Guide says that “social media engagement is a reliable way for printers to market their business, communicate with customers and increase brand awareness.” The guide explains where to begin, including what social media tools can work best and how to implement such a marketing plan. It can help those just getting started with social media marketing, as well as “refine the knowledge and technique of the social media-savvy.”

The “2015 Social Media Marketing Industry Report,” published by Social Media Examiner, surveyed over 3,700 marketers to understand how they’re using social media to grow and promote their businesses. It found that Twitter, YouTube and LinkedIn are high on the list for marketing plans, but marketers also wanted to do more with Facebook. Video currently is being used by 57 percent of marketers, while 72 percent of respondents want to do more with video production. The report found “the top two benefits of social media marketing are increasing exposure and increasing traffic.” In addition, “More than half of marketers who’ve been using social media for at least two years report it helped them improve sales.”

Getting animated at Creative Coatings

Creative Coatings, San Diego, California, has been delivering postpress finishing services from concept to completion to clients in the Western United States for 30 years. In the last six months, it created a YouTube channel to share cool techniques and ideas about printed projects to potential customers. “We have been producing two types of videos for social media marketing – marketing and educational,” said Dina Lyon, sales/account representative at Creative Coatings. “We not only market our products and services with videos, but also believe that being a partner and asset to our customers by training them is a high priority. This builds the relationship while creating success for all of us.”

Creative Coatings uses PowToon to create its animated training videos.

Lyon creates the videos using one of two different video authoring programs – Animoto or PowToon – and then posts them to the company’s social media spaces on YouTube, LinkedIn, Google+ and Facebook. The videos offer unique perspectives by showcasing a service provided by Creative Coatings through project photos or as an animation explaining a particular process. The marketing videos are created using Animoto (www.animoto.com), which describes itself as an easy way to create professional-quality videos without the need for technical know-how or expensive production equipment. The educational (animated) videos are created with PowToon (www.powtoon.com), a free business animation software and PowerPoint alternative. According to its website, PowToon allows users to create colorful, visually engaging animated presentation-cartoon mashups with drag-and-drop simplicity. “We chose animation for training videos because we can promote products and train people how to utilize those products all in one video,” Lyon said. “Animated videos are simple and elementary, so the communication gets the point across quickly and easily.”

On the more traditional videos, Lyon takes care to only show products that clients have approved to share. “We strategically show images that won’t divulge any client information publically,” she said. “We’ve had extremely good responses. Our clients, both current and new, always are looking for new ideas and information.”

It can take two or more days to put the videos together, Lyon said, noting her deadlines are flexible depending on the project. “It really depends on the content topic and product,” she explained. “Some products and services or informational videos have a lot more information to share than others.”

The company’s goal is to post something new each month, but doesn’t want to inundate its clients with too frequent updates. “It depends on the time of year and what information we see our clients needing,” Lyon explained. If a client requests a certain product or service, though, the company’s staff can send the videos out as needed while having conversations with clients. “Our estimators, CSRs and sales staff follow up via email with the video link that corresponds to the information the client is looking for,” she said.

Measuring ROI

Creative Coatings is careful not to divulge client-specific information in its promotional videos.

According to Social Media Examiner, “ROI is proof that your marketing efforts are working.” It can be measured in a variety of ways, such as lead generation, customer acquisition, clicks, revenue, etc. Social Media Examiner offers five steps for measuring social media ROI. Those steps include setting goals, determining the right platforms, tracking campaigns, reporting the findings and reviewing results/ resetting goals.

At Creative Coatings, ROI hasn’t been measured yet, partly because their initiative is so new. However, the company sees its social media use – especially its use of animation – as “preventative maintenance via mass communication,” Lyon said. “Training videos won’t always indicate an instant sale or immediate new client, so the ROI is very difficult to track in this circumstance. In the printing industry, some projects don’t come to fruition for months. Our videos are not focusing on any one project. Instead, they focus on the concepts that go into all projects. We continue to provide these informational videos in hopes of training our existing customers so that they can learn and at the same time share and refer new clients our way.”

PostPress would like to thank Social Media Examiner for providing its “2015 Social Media Marketing Industry Report” for this article. Social Media Examiner helps businesses discover how to best use social media, blogs and podcasts to connect with customers, drive traffic, generate awareness and increase sales. For more information, visit www.socialmediaexaminer.com/report2015.

A Walkthrough in the Four Steps of Kaizen

June 17, 2015

by Kara McPipe, Artistic Finishes, Inc.

Imagine that you are a manager of a manufacturing plant. The production reports are studied every day, and it is discovered that one of the lines continually is getting worse. You walk out to the line and ask the operator why the numbers are dropping. The operator immediately states, “The machine is old and doesn’t work the way it used to.” Is your first thought, “We need to buy a new piece of equipment to replace this outdated thing?”

New equipment or technology often is our first choice. Kaizen often is a better choice, because even with new equipment, if the process has waste in it, will the new equipment help? The Japanese word Kaizen means “change for the better.” Kaizen focuses on looking at a process and removing waste from it.

Let’s look at the example above again. If a few minutes would have been taken to observe the process, there might have been observations like the operator leaving his machine to collect job materials, making the same adjustment multiple times or searching for a missing tool. All of these observations are forms of waste and prevent the machine from running. If you take a few minutes to look around your own plant, you will notice the same type of waste everywhere. Problems get in our way every day, and they decrease our efficiency. Remove these problems (waste) and think of the positive impact it will have to the equipment efficiency.

Every plant strives for perfection out of every piece of equipment it owns, but often forgets to look at the simple things which can cause the machine not to run. This is where a Kaizen event can help. A Kaizen event has four key phases: Selecting, Planning, Implementing and Follow Up. Kaizen events will cause minimal disruption to your current daily production output when planned well, but they can yield a significant increase in efficiency once completed.

Selecting a Kaizen event

There are several areas where a company can look for Kaizen opportunities. One of the easiest ways to identify a Kaizen event is by creating a Value Stream Map for the production workflow. This tool can help to identify bottlenecks or slowdowns in the overall process so you can see what areas should be improved first. The book Learning to See by Mike Rother and John Shook can help anyone effectively create a Value Stream Map for his or her organization. A corrective action system or any other error-tracking system also can be used to determine where opportunities are for improvement. Utilize an idea system to pinpoint ideas that are larger in scope and may warrant putting a team together to solve the issue. Ultimately, it is important to listen to the data and the operators on where the biggest issues are within the organization.

Planning a Kaizen event

A scope and goals document clearly laying out the problem, scope of the event, goals the team should focus on, team members and schedule must be created. To start, take the time to research and understand the issues. Often, we want to jump to improvements because we think that we already know the solution, but just like the example above, this potentially could lead us down a path that may be costly for the company and, potentially, a waste of time. Conduct interviews with leaders and subject matter experts in the affected area. Collect data where appropriate. Once you have gained a better understanding of the problems, write an issues statement to help the team look for them and address them in the discovery and improvement phases.

Next, create a scope that is specific and attainable within the given Kaizen event time frame. A well-written scope helps to keep the team on track throughout the event and can prevent team members from looking at areas outside of the defined scope. Consider goals the team must tackle and base these on a realistic time frame (typically two to three months). Well-defined goals can assist the team members in staying focused if they are struggling.

When developing the team, it is key to gather subject matter experts from upstream and downstream functions, along with people with fresh eyes (those who know nothing about the process). Six to eight people are ideal in larger companies, while in smaller companies, four to five people on the team is typical. In most situations, using the area leader as a sponsor of the event instead of a member allows the team to not feel confined to what the leader wants. A poorly defined team may make it difficult to reach the Kaizen goals.

Finally, schedule the event based on the size of the scope and the resources needed. Kaizen events can run anywhere from three to five days. In smaller companies, it may work better to break the scope into smaller chunks and allot three- to four-hour increments to complete the Kaizen event. Proper planning is the key to a successful Kaizen event, so don’t rush past this step.

Implementing a Kaizen event

Implementation of a Kaizen event starts with a facilitator. The facilitator has key responsibilities, including training the team on Lean tools, keeping the team on track and helping the team to visualize what the future could be.

The most critical responsibility of the facilitator is getting the team to see the current process. Returning to the example at the beginning of the article, we instinctively want to go to the improvement phase, but if the team doesn’t take the time to understand the current process, real improvements could be missed. It is the job of the facilitator to help the team to see the waste, so the team can come up with ways to reduce it. Taking videos, using a spaghetti diagram and gathering forms used in the process are a few ways to help the team to “see” the waste. Once the waste has been identified, the team will spend the remaining time of the event brainstorming improvement ideas and beginning to get them implemented.

Follow up on a Kaizen event

In almost every case, there is not enough time during the event to implement all improvements, so following up after the event becomes the next critical step. Follow up often is the most difficult part, so staying organized and maintaining a consistent leadership message is imperative.

Use a Kaizen newspaper to keep track of the improvements identified during the Kaizen event and the status of completion of each item. The Kaizen sponsor (area leader) should own and drive the Kaizen newspaper. Communicate the Kaizen results to leadership and the company using storyboards to show what the team has accomplished. As the Kaizen event is being implemented, continue to measure the Kaizen goals against the results. Keep the metrics visible for everyone to see and readdress when results are not sustained.

As you begin your first Kaizen event, remember to take the time to properly scope the event; understand the process; measure (you cannot improve what you cannot measure); get employees excited and involved before, during and after the Kaizen; and, most importantly, ensure there is management support and Kaizen follow-up. Over time, each Kaizen will become easier. Before you know it, efficiencies in your plant will happen that you did not expect with the current equipment.

This article was reprinted with permission from PIA’s The Magazine. The author, Kara McPipe, is the continuous improvement manager for Artistic Finishes, Inc. Founded in 1985, Artistic Finishes specializes in finishing hardwood moldings, vents and treads that complement over 13,000 manufacturers’ hardwood and laminate flooring lines.

Top 5 Ways to Keep Your Customers Happy

June 17, 2015

by Brittany Willes, PostPress

Your customers are the lifeline of your business. Their satisfaction with your products and services determines your revenue stream. Happy, satisfied customers mean a more profitable business. How can you make sure your clients are happy, and remain that way, to boost your bottom line? Here are five ways to show your clients that you value their business.

1. Pay Attention

Your customers need to feel that you are listening to them, which involves much more than simply waiting to hear that they are satisfied with your products and services. Paying attention means learning to anticipate your clients’ needs, knowing their expectations and being able to interpret those needs in a way that ensures all parties are satisfied with the end goal. Pay special attention to any concerns your client has expressed. Few things are more frustrating than feeling as though apprehensions are falling upon deaf ears. By paying close attention to your customers, you demonstrate that they are valuable to you, reinforcing their trust and confidence in your business.

2. Don’t Believe the Multi-Tasking Myth

We live in a society where attention deficit is common place – expected even. Multi-tasking is considered one of the most valuable jobs skills and perceived as a necessary business practice. It’s no surprise then when businesses take on more work that is wise, encouraging employees to multi-task projects in the misguided belief that it will save valuable time and resources. As a result, full and complete focus goes out the window. Juggling multiple projects means no one project will receive the concentrated attention it deserves. This can lead to reduced quality and dissatisfied customers. So, slow down. Don’t take on more projects than is reasonable to ensure customers receive the best quality you can offer.

3. Don’t Play the Blame Game

No one likes to admit when they’re wrong. Your first reaction is usually to cringe, deny and look around for the nearest scapegoat. If you make a mistake, don’t try to slough the blame off onto someone else – especially the customer. Acknowledge your error and reassure your customer that you will do everything you can to rectify the situation. Most clients understand that mistakes happen and no one is perfect. Trying to stop looking bad by avoiding responsibility actually makes you look worse in the end. Customers are less likely to trust your word or your professional abilities. As a result, they will be less likely to seek you out in the future.

4. Remind Your Customers You Value Them – And, They Should Value You

Like you, your customers get busy and may not always remember everything you do, or have done, for them. There’s nothing wrong with a friendly reminder that they have one less thing to worry about because of your customer service. This can take the form of a quick phone call, a friendly email or even a monthly newsletter. Keep your customers happy by reminding them that while you do value their business, they also should value yours in return.

5. Don’t Forget the Personal Touch

Technology has made it easier and more convenient to communicate with anyone, anywhere, at practically any time. Yet, how often do we become frustrated when reaching a voicemail or automated recording instead of an actual person? Or while waiting for a response to an email sent a week ago? Keep your customers happy by keeping it personal. When possible, arrange to talk to your customers in person. Make use of emerging video messaging technologies so that your customers always have a face to put with your name/voice. While it may seem old fashioned, don’t discount the value of a handwritten note or thank you card sent to your most valued customers. Let them know how much you continue to appreciate their business by adding a personal touch to your business relationship.

Some items on this list may seem obvious, but that doesn’t make them any less valuable or that you’ve been practicing them effectively. The best time to determine if you’re keeping your customers happy is now. So, take stock. Have you established a personal connection with your clients? Do you devote your full focus to each project you undertake? Are you hearing clients when they express their concerns, as well as their satisfaction? If not, it’s time to devote more of your efforts to keeping your customers happy to keep your company growing.