Issue link: https://read.dmtmag.com/i/84151
58 • OCTOBER 2012 • WORLD FENCE NEWS This month, I have been asked to write about taking advantage of dis- counts offered by your vendors, where and when available. I have devoted space to this topic on several different occasions over the years, particularly during the onset of our most recent re- cession as regards to the need to cre- ate additional savings in rather trying times, or in some cases "the worst of times" for many of us. Prompt pay is always a "best busi- ness practice," but especially if your vendor offers discounts for paying early. It can really add up. During the course of the past sev- eral years, this industry has seen its fair share of ups and downs, at both the manufacturer and distributor level, as well as at the contractor level. There THE HUMAN LINK by Jim Lucci Management Motivational Associates If discounts are offered, take them! have been certain areas of the country hit harder than others, but all have shared in the economic and demo- graphic changes to one degree or an- other, and have had to make adjustments accordingly in order to survive or maintain some level of prof- itability during these tough times. In talking with so many of you over the past several years, and listen- ing to how each of you were being af- National Metal Industries WE'RE NOT JUST SLATS! TOP CAP CHAIN LINK FITTINGS COLOR SLEEVE 2 Neil Court, Oceanside, NY 11572 • (516) 594-0364 • Fax (516) 594-0377 fected by the economy in your area, some things became evident over time. Perhaps the most significant factor is that those who have been in business 10 to 15 years or longer were much better equipped to make adjustments in the ways necessary to hold their own, or, in some cases, make profits, albeit generally much smaller than prior to the recession. Included in your comments when asked about what steps were taken by you to help you navigate successfully these turbulent waters were those that directly concerned themselves with taking discounts, when available from your vendors. You have told me that longevity in PVC FITTINGS BOLLARD COVERS TOOLS PRIVACY SCREEN WWW.NMIFENCE.COM Proudly Working to Take the Fence Industry to New Heights! this business has taught you to, among other things, pay specific attention to the development and maintenance of cash flow in your operations, so that you would be able to take advantage of these discounts and other buying opportunities when made available. (I would point out, at this juncture, that of all the business statements that are designed to show how your business is doing at any given time, in my judg- ment, none is more important than your cash flow position. This can speak volumes of how one manages the operational activity of handling money.) Of those contractors who have been in business 10 years or less, some have of course done better than others, but more specifically, in the five years or less bracket many of you have told me that this has been the "the worst of times." In addition, too much of the busi- ness is drying up in your area, or going to other contractors because of more competitive conditions. It has been very difficult to take advantage of ven- dor discounts because of a lack of cash flow available. Many new contractors have emerged as a result of other contrac- tors going out of business in an area, and therefore some of their personnel have decided to go into business them- selves and are experiencing these con- ditions for the first time from the other side. At this point, I need to point out that there were several contractors, particularly over the past year, who have told me that they have had some terrific years – "the best of times," whether they did 100% commercial or a significant portion of their business was in residential. Several commented that being es- tablished and having built a good rep- utation leads to more referrals or word of mouth business. It clearly makes a difference when you are an established company and have been through all kinds of battles and situations and have learned from experience how to plan ahead and ad- just for those difficult times that plague all of us who are in business, at one time or another. There is no sub- stitute for experience. To the newer contractors who have had the worst of times during these past several years, my advice to you is to hang in there and seek some guid- ance from those who can provide you with direction in the spirit of profes- sionalism. There are no shortcuts to obtain- ing business success over a long period of time. Hard work, coupled with a passion for what you do, and an intel- lectual curiosity, are at the very least part of the basic cornerstones needed to build on. I urge all of you to continue to- ward building your cash flow so that you can take advantage of the vendor discounts that are made available to you and thereby help you increase even more of that all important cash flow situation. Many of you have shared a cau- tious optimism for the rest of the year and perhaps some positive indicators that things might continue to improve continued on page 60