I have worn a lot of hats in the pages of this magazine, but acting as the InfoComm Rental & Staging Council Chairman, the resident MBA, or veteran Stager, my view has always been from inside Alford Media Services. Beginning with this column I come to you as your Consultant reporting on trends that will affect your business, pointing out opportunities that your suppliers need to be aware of, and sharing techniques that will help your businesses run more smoothly. Check your radar screens right now, there is a fast moving blip on the horizon: it's the economy.
The indicators I have tracked for the past twenty years now say that the AV Rental & Staging industry will be seeing substantial growth for the foreseeable future. Convention bookings are way up, hotel rates are surging due to high occupancy, the airlines are flying full, and the stock market is reaching record highs. As I write this article, gasoline has dipped under $2.00 a gallon in some areas and the Federal Reserve has stopped raising interest rates. There are also some serious threats. Major event rental companies traditionally outside of the corporate and convention arena are focused on this market and investors are currently evaluating the next round of consolidations. As we say in Texas, Are you going to be the fly or the windshield? Here are some thoughts on what you might want to be doing now to have a great 2007.
No Risk, No Reward
Put together an aggressive strategic plan for the next three or more years. Too often we only think about next year, and you cant get much done in one year. Take some long-term risks; big results come from big promises. Find a new product or service that no one in your market is doing and jump into it deep. Struggling to handle the challenges you already have? Then make a commitment to fix those problems: admit to those shortcomings and pledge measurable results by a certain date. My guess is that you are the kind of company that lives up to its promises. So, give your word and I bet you will accomplish that goal.
Customers want fresh ideas and better solutions and will go where they can find them. Levering up is financial lingo for investing money (and borrowing money) and in the rental business, capitalization is the key to building equity. Many of us undercapitalize because we overvalue what we have or underestimate the significance of a trend. The value of a piece of rental equipment today is based on how much revenue it can generate tomorrow. If you dont have any customers for it, then its value is close to zero, regardless of how many zeroes were in play when purchased. This means retiring old equipment to make way for new. It may be satisfying to receive occasional revenue from that four year-old projector, but is that helping to grow your business? There is one more reason to lever up: motivation. I guarantee you wont let new technology collect dust.
Sales, Service, and Support
Give your customer service system a tune-up. Try calling customers you have lost and get them to tell you why. If that sounds like too much trouble, then address customer contact points that too many rental companies neglect:
Improve the look of your bids, they are too hard to read and look more like a shop order than a professional proposal.
Send your receptionists, rental order takers, and accounts payable/receivable personnel to a customer service class. They are ambassadors for your business; give them the right tools for the job.
Imagine what your equipment says about the company. Hold a cleaning party and put a shine on your cases, cable, and equipment.
Interview and Train Freelance Staff. In hundreds of interviews over the years, I can count on one hand the technicians who turned out the way I expected. How they handle pressure, ambiguity, and technical challenges is what really counts. Freelancers, just like your staff, are an investment. If you have a good prospect, put that person on a show when the urgency is low and you have the resources to back them up. Train them on how your company does things, and dont be surprised if they teach you a thing or two. Customers may be understanding if a freelancer isnt up to snuff, but that is not the same as being satisfied.
Rethink Incentive Programs. In a moving economy, Salespersons are easy targets for headhunters. It is easier to keep a salesperson than to find a new one. De-motivating incentive programs are the primary reason why they leave. Reward the behaviors you want repeated. Dont push new business without incentives to maintain existing customers. Reward more often. Studies show that employees will accept lower bonus rates if you distribute incentives monthly rather than annually. Never base a significant part of the bonus on factors over which the recipients have no direct control. Celebrate earned bonuses even when business is down. The key word here is earned.
I could continue this list for several pages, but tackling one or two of the above would be a big job for most companies. Successful companies dont just happen; they are the product of passionate responses to business challenges. When someone recognizes a threat or opportunity on the horizon they should be encouraged to bring it to everyones attention. Then as a team discover your best response and give it your undivided attention. Be the windshield.
Evaluate your strategic plan when:
Economic factors alter their course or
Technology improves or comes down in price or
Your current plan is more than half over or
Your advantage over competitors changes or
Business is better or