What are the questions that you periodically ask yourself about the business?
You think it through, ask your friends and business associates, contemplate your
options for a
while and finally may come to a decision or even postpone the decision because
uncertainty. And when these decisions are made, they never actually seem to
business, so you revisit the questions again and again.
This reflects a process referred to
as “reinventing the wheel.” It
provides a very low return on your
investment of time.
In the last article we discussed the
continual decision-making process
involved in increasing prices and
some of the agony that seems to go
along with this process.
Alternatively, this process can be
standardized, providing improved profitability, and free up your time for some
decision making. Other business decisions can either be eliminated,
standardized, or considered
far less frequently once we understand the nature of the decision.
Calculating pieces per operator hour
This is a fun one because there is no right answer. That’s right. No right answer. The only
critical element is consistency in the calculation.
If you add up all of the hours worked by your drycleaners, pressers, inspectors,
and baggers and divide it by all the drycleaning pieces, you’ll get a number like 14 or 16 or even
something around 20.
Someone else might add in the counter staff hours and taggers and get a number
like 5 or 8.
Nobody is right or wrong here. Only different. If you want to compare your
number to others,
then you just have to agree on which people to include. Otherwise, use a number
the most sense for you, be consistent in your calculations, report it, and work
on improving it.
You’ve got a much better use of your time working on improvements than arguing over
calculation is better. It’s time to move way past this question.
Should I use plain or printed poly?
I have had companies tell me that plain poly is the best way to go. Eighteen
months later they
brag about the benefits of printed poly, or vice versa.
Consider how many hours you have spent debating this question, researching your
designing and purchasing new stock, but to what end? What return did you expect
investment of time and money? What return did you receive?
The reality is that this is not a stand-alone decision. It is a decision that
must be made in the
context of your entire brand, with the look and feel of the customer experience
that you want to
pass on. If this is the decision, it comes very infrequently, not every 18
months, and it comes
along with the evaluation of the image of the whole company.
Should I dry up the plant?
Perhaps, to your surprise, this is rarely an item that requires much discussion
receives more than its fair share. It is really a volume and cost issue. Hear me
Let’s say you have two activated plants. Both are running under capacity. You
already have a
truck running between the locations since the shirts are all done in the larger
If you dry up the smaller plant, you have an immediate savings on utilities. You
may or may
not have a savings in labor as some of the people would move to the new plant,
hours may expand and the counter staff no longer assists in assembly.
Nevertheless there is
clearly a savings on utilities.
The problem that stands in most people’s way is the fear that sales will fall once a plant
becomes a dry store.
Here’s the real story so we can understand this business, make a decision and move
When a plant becomes a dry store, several customer experiences can change.
First, promise times might get longer.
Second, staff may communicate that the work is being done “elsewhere.”
Third, quality may fall, primarily during transport. All of these conditions
will cause sales to
The most common problem is the first one — poorer service times. If this can be avoided, the
sales trend for the store will not change and it’s been proven time and time again.
Notice that I didn’t say sales dollars will stay the same. I said that the sales trend will stay
same. Frequently it is falling sales that leads to the question of drying up the
plant in the first
case. That trend will most likely continue if it is the demographics of a
causing the fall or there is increased competition, but the falling sales is not
a result of drying up
There is a list of questions that constantly get asked, again and again, of your
your staff, your partners, and yourself, but rarely do these repetitive
questions result in added
value, i.e. profits.
Make a list of those questions that you repetitively ask. If you can stop
wheels, sometimes by simply documenting the how and why of particular decisions,
can move on. Only when some of the basic assumptions change, or, for instance,
technology advances, then it becomes worthwhile reviewing the decision next time
Moving beyond these time-consuming and repetitive questions can significantly
profitability. This allows us time to invent new wheels and leapfrog the
imagine how you might use a few extra hours to expand your marketplace,
product line and build your volume.