Don’t Send the Wrong Message

by WOHe

Donald Fletcher has some important words of advice for kitchen
and bath design firms that may be experiencing a bit of a downturn
thanks to the first-quarter economic slowdown.

Fletcher’s advice: Don’t let on to clients and prospects that
business may be off; the last thing you want to do as a business
owner is create the perception that your company is feeling a
pinch. That’s a perception, Fletcher observes, that could quickly
grow into a dangerous and damaging reality.

Fletcher, of course, should know.

As president of the building industry consulting firm George S.
May International Company, he presided over a recent study which
conclusively revealed that homeowners retain a marked preference
for working with remodeling professionals who exude success.
Remodeling consumers feel far more more comfortable with companies
they believe will meet their expectations, Fletcher notes. While
they may feel sorry for a business that’s experiencing hard times,
he adds, they’ll take their business elsewhere in a heartbeat if
they get even the slightest hint that something is wrong with your

This reaction part human nature and part a fact of business life
is exceptionally difficult to overcome once it begins. It also
warrants particular attention these days.

The current industry slowdown which may be more myth than fact,
and will probably be over before it’s truly felt is a time for many
things . . . the least of which is to signal prospective clients
that business may be off and your company may be hurting.

Instead, kitchen and bath dealers and manufacturers should view
any sort of slowdown they may be feeling right now not in a
“glass-half-empty” frame of mind, but in light of the opportunities
a slowdown presents. In short:

The opportunity to devote more time to customer service,
marketing, personnel and other issues that may have gone neglected
when the flow of business was at a fever pitch.

The opportunity to address critical showroom needs that weren’t
on the radar screen, in terms of your priorities, until you had a
moment to breath.

The opportunity to branch out into sales of new kinds of
products and services, while broadening your base of business and
creating new types of clients.

The opportunity to simply catch up on things, energize yourself,
polish your skills and tweak your business none of which you can
really get to when business is “too good.”

Now is a good time to remind yourself, too, that a high level of
revenue doesn’t necessarily translate into a high level of
profitability and that there are steps you can, and should, be
taking to increase your profits even if sales are down for your

In fact, according to the NKBA’s recently completed 2000 Dealer
Profit Report reported on in this month’s issue of Kitchen &
Bath Design News controlling key profit variables is of far greater
significance for kitchen and bath dealers than simply increasing
annual revenue. Interestingly, the Dealer Profit Report finds that
the highest-profit dealers in the industry actually have lower
average annual revenues than “typical” dealers. They also have far
less overhead, turn inventory faster, get paid quicker and have
greater levels of employee productivity.

All of which have nothing at all to do with the high levels of
revenue typically associated with high times good news when sales

Lastly, I think it’s important to put the current “downturn”
into proper perspective.

Stated succinctly, things are not nearly as bad as some people
may make them sound. Viewed in a historical vein, in fact, they’re
actually quite good maybe not quite as good as they were in the
past few years (which, remember, were record years), but certainly
far better than most years in the industry’s history.

So don’t go broadcasting the news if sales at your company start
to slow. It may not necessarily be “bad” news for your business at
all and it’s certainly not the kind of news you want to share with
the people you’d most like to do business with.

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