Keeping a Business New and Refreshed

Keeping a Business New and Refreshed

Do you know what a GI party is? Well, if you do, then you know you do not want to be invited to one. This is an activity that the enlisted Army goes through in preparation for inspections. Each soldier cleans their living quarters from top to bottom eliminating any errant dust particle with an arsenal of cleaning equipment. When the party is over, there is not a spot left to clean. There is a reason for this activity, and it does have something to do with people in any type of business.

            These GI parties have a discipline training aspect to them. They get the soldier used to taking care of things, paying attention to small details, and following orders of the soldier supervising the cleaning. The reward is self esteem and satisfaction when the job is well done. The other aspect of this activity relates more to the jewelry industry. This activity keeps old buildings looking fairly new. Even the old Quonset huts looked great with the newly waxed floors. The very old barracks continue to look livable due to this activity.

            Now take a look at your store, office, or other place of business. How does it look to the customer or potential customer? Run your hand on top of the door, picture frames, and other surfaces. Is it clean? Are there things that are yellowed that used to be white and things that are washed out that used to be colorful? What happens is that you see the place everyday so the change is so gradual that it goes unnoticed.

            The challenge is to look at your business like it was your first time to see it. For most people, this will be a jaw dropping experience. The second part of the challenge is to roll up your sleeves and start cleaning. Get rid of all outdated posters, discolored fixtures, and even your outdated inventory. If you still have nugget rings from the 1980s, melt them down into something new or sell the gold. Once you have your “party,” take a look around once again. If you can see the difference, your customers will as well.

            Everyone knows a loaf of moldy bread is undesirable and a fresh loaf attacks the senses in a opposite way. The same holds true with your business. Keep the look fresh and new. Assail the customer’s senses in a way that will entice purchases. Just think; a little elbow grease could result in increased revenue. What a great return on investment!

Managerial Finance "Little Things Do Matter"

Managerial Finance

Little Things Do Matter

     Managerial finance functions should be performed continuously. There are many things that are overlooked during the expansion or contraction of a business. It is of course best to start with the larger, more meaningful tasks, and then start paying attention to the smaller things that will bring efficiency and cost savings to the organization. Here is a case in point.

     A grocery retailer here in Honolulu has grown from a small mom and pop convenience store to a three store, one warehouse specialty retailer. Shipments arrive daily at the warehouse and then the goods are distributed to their respective stores as needed. The overall business performs well. There is more growth planned, but in the meantime, there is some fine tuning that can be done.

     Let us face it; we all overlook a lot of things. As things change, habits of old seem normal and do not appear to be a problem. This three store enterprise has always had their mail delivered to the oldest store and then picked up by the warehouse worker and taken back to the warehouse office. This makes sense since the warehouse office is where all of the billing, ordering, and accounting is performed. I am sure that you have already figured it out, but this has been a habit built into the system over many years. You would think that a simple address change to the warehouse location would have been done a long time ago. You may be wondering what this is costing the company.

     It may not seem like a lot, but the office worker does have to walk across the street to the store to get the mail. Of course, like anyone else, there will be a little chit chat and common courtesy going on as well. The conservative cost estimate on this system is as follows: One person at an estimated 10 dollars an hour taking ten minutes daily to pick up the mail. This happens six days a week since they only close two days a year. There are fifty-two weeks a year and not counting postal holidays, there are 312 days of this activity (52*6). 312 days times 10 minutes minimum per day equals out to 3,120 minutes per year. 3,120 multiplied by the time cost .17, is $530 per year (3120 x (10 / 60)). That makes it just over ten dollars a week.

     This of course was a very conservative figure. When the ten dollar an hour employee is gone to get the mail, the job they were hired to do is not getting done. This means that the cost is actually double than the conservative figure. The cost is up to twenty dollars a week now and over a thousand dollars a year. If you take into consideration that the worker will need to catch up on any missed phone calls, orders, and other things, a greater cost may be realized. If the person has to work overtime each day, the cost will be even greater than the estimate. You may even want to do a more accurate costing by figuring in exactly how much a ten dollar an hour employee costs the company. The company provides healthcare, uniforms, and free lunches to the workers.

     You may be thinking that a thousand dollars a year is way too small to worry about. You may be right to a certain extent. The problem is if there is one little thing like this that can be improved upon in an organization, there are probable many more. If each one is costing the company a thousand dollars a year, you can see where these little things can add up to some serious money. It may be time for you to look around your company and find things that need to be fine tuned. You may be able to treat yourself to a great reward.