Business Post Cards: Five Factors To Consider
Running a business is difficult enough. So many factors can determine the success of your company, it's hard to know what to focus on when planning for the future. Here are five factors you may want to consider when preparing for the next phase of your business: pricing, clients, employees, marketing, and support.
In an uncertain economic climate where other companies that have come before you have failed in one area or another, these factors will help lead you in the direction you need to go with confidence and conviction!
This blog post includes quotes from experts on each factor and also includes resources and statistics from various sources such as The Wall Street Journal.
1. Pricing [ARTICLE]
In a tough economic climate, many companies have been forced to change their pricing to be more competitive. This is an extremely important factor to consider!
When you are in the position of having to choose between two different pricing options, ask yourself why you are choosing each option. For example, is it because of price? Quality? Brand preference? Or is it because you don't want to lose clients because your rates use to be cheaper than another company's? A good way of figuring out what your client base wants and needs from your products or services is by doing some research. Use customer surveys, interviews, questionnaires or even focus groups to figure out whether or not your prices are in line with the market.
"Price is not the only consideration when it comes to attracting and retaining workers. For example, at Cintas, a uniform supplier and janitorial services provider based in Cincinnati, Ohio, employees can start collecting their pension benefits at age 62 if they've worked there for 20 years—more than five years longer than other employers offer."
Did you know that the average employee turnover rate is lower than 10%? That's just one of many statistics that indicate how important retaining good employees can be.
This is where that employee survey comes into play. You need to know what your employees really want because it's not always going to be about the money. Are they looking for advancement opportunities? Maybe they want to feel that their contributions are valued in the workplace. Whatever the case, be sure to ask and figure out what will keep them happy so you can retain them longer.
"Courtesy and professionalism are especially important during rough economic times, says Cintas' Mr. Rutte: "When something goes wrong inside a person's home, they do not want our people blaming anybody but themselves. If a customer is upset with our service and we have someone who's worked there for 20 years, they'll say, 'Why didn't you apologize to them? Why didn't you go up and put your hand on their shoulder and tell him that you were sorry that he was having a problem? Sometimes all we need is a little bit of human interaction.'"
Luckily, managers are trained to act professionally in all situations. If you give employees the proper training then it won't be an issue.
2. Clients [ARTICLE]
In a tough economy, clients are looking for the best deals, which means that a company that is offering a lower rate than another company will get more business than the company who wants to charge higher rates. This is why it's so important to do your research and find out what your clients want.
When you speak with your clients and ask them what they think about your products or services, be sure to not let them know why you're asking these questions. For example, "I'm trying to figure out if my products are priced competitively. What do you think?" is better than, "I'm trying to figure out if I need to lower my prices."
It is one thing to ask your clients what they think of your services but it's another thing entirely to ask them what they would pay for them. While there are plenty of people who will always go for the lowest price, many others prefer not having a budget. You can never know what your client base wants until you ask!
"In 2008, industry revenue dropped 8%—a steeper decline than the 4.3% drop reported by the Scottish textiles industry. Despite the drop, the industry has a positive future according to Church and Dwight's Hintz. "Many of our customers have been reducing their usage when they can, but they still want long-lasting freshness," he says. "They realize that there are benefits to using air fresheners like odor management and indoor air quality improvement."
"In a tough economy, it's important to be able to justify your refund policy," says Hintz. "You may need to accept returns of damaged goods in order to continue selling your product."
While loyal clients are great, what many people forget is that you also attract loyal clients through your employees. Unless you are willing to lose your employees because they want to make more money, great benefits and a good work environment, then you shouldn't discount your prices.
3. Employees [ARTICLE]
In the current economy, employers are seeing that it is important to offer compensation packages and benefits that will draw in new employees who are loyal to the company and actually stay there for a long time. On the other hand, many employers have found that it is better to lower their rates and be more competitive in order to increase retention.
"While a number of companies have adjusted their profit-sharing guidelines during this tough economic situation, Cintas has not cut back on its benefits package," says Mr. Rutte. "Every year we have tried to provide better and better benefits, trying to make it the best benefit package in the industry. We charge more because we know that when you compete in the market, you have to give more."
If your employees are happy and feeling valued then you won't have to worry about them leaving for other employers. However, if your employees are unhappy with their work environment or feel that they are undervalued, then they might leave for other companies that offer them a better work environment or a more competitive pay.
"While most of our competitors were caught off guard by the recent downturn in demand, we were not surprised," says Mr. Rutte.
Conclusion
"Until you take a good, hard look at your pricing practices, you won't get the results you're looking for." - Joseph DiRosa
"Profitability is a function of many factors beyond a company's products or services and is based on factors that are difficult to predict or control. It is quite possible that once the dust settles and we see just how much longer we are going to be in this job market, companies will adjust pricing and associated benefits accordingly in order to attract and retain qualified staff." - Harlan Wallerstein
"It's costly to hire new people every two years.