(Time to read this Blog is about 2½ minutes)
Before we get to the main topic, here are a few things to get you thinking:
- My biz quote of the week:
“Many businesses make the mistake of promoting their Brand Promise and Brand Values to their target customers before they’ve successfully ‘sold’ them to their own staff. If your staff haven’t bought into your Brand Promise & Values, they won’t deliver it to your customers.”
- I have just one Biz Coaching ‘space’ available for this Fall. If you’d like to receive our Info Sheet on how this 6-month 1-on-1 coaching program can help your business and your bottom line, email me at firstname.lastname@example.org.
- The post-Covid workplace. In a survey by my friend Cheryl Cran at com, when employees were asked how they would prefer to work in a post-Covid world:
• 9% of respondents stated they want to work in the office full time.
• 36% stated they’d prefer to work mostly from home.
• 55% said they’d choose to work remotely at least 2 days a week.
- The world’s largest city. Tokyo, where the Olympics have just ended, is the world’s largest city with a population over 34 million.
Now, to this week’s important topic:
Just like winning in sports, generating a healthy bottom line is a game of inches:
In most sports, winning is about being a just little bit better than your opponent at the basics of the game. It’s about blocking, tackling, back checking or hitting just a little bit better. It’s about winning a few more free throws or getting the ball deep into the corner of your opponent’s court. It’s about being a millisecond faster, being just a little bit stronger and a little bit more committed to an extraordinary outcome. Winning is a game of inches!
And so it is in business. Generating a healthy bottom line is about being just a little bit better than your competitors at a few key things. It’s about serving customers just a little bit better and selling just a little bit more. Increasing sales by just 5% could grow your bottom line by 20% to 40%, depending on your gross margin. Turning your inventory just one more time each year could increase your profit by 25%.
In some industries, reducing energy or fuel costs is a key profitability factor. Papa Johns, the world’s third largest pizza chain, worked with an oven manufacturer to develop a more efficient oven that bakes a pizza just two minutes faster but will save 25% on energy costs.
Cathay Pacific, one of the world’s best airlines, stripped the paint off all their freight-only aircraft, except for the tails. The 200 Kg weight reduction saved them $190,000 per plane, per year in fuel costs. Then, they cleverly renamed their fleet of freight aircraft ‘The Silver Bullets’ to put a positive marketing spin on their penny-pinching innovation.
In other businesses, reducing waste just a little bit can have a major impact on profitability. An independent pizza restaurant owner got tired of seeing carelessly spilled grated cheese on the floor near the ‘make line’ (the area of the kitchen where the pizzas are assembled for baking) where the crew scoops big handfuls of loose cheese out of a bin and spread it on the pizzas…and, apparently, on the floor.
Cheese is the biggest expense in the pizza business and even a little waste will impact the bottom line severely. So, my restaurant owner friend simply bought a few three-foot square plastic tubs and three sizes of zip-lock bags (the ones with the actual slider for efficiency) from the dollar store and created a little portion control program where just the right amount of cheese for each size of pizza fits into the appropriate sized bag. The bags are filled while being held over the large tub of grated cheese and any that falls, falls back into the tub. Filled and zipped bags of cheese are placed in plastic tubs on the ‘make line’ where they’re quickly unzipped and the cheese neatly dispensed. Simple? Yes, but it immediately increased her bottom line by 25%!
So, are you winning the ‘game of inches’ in every part of your business…or are a lot of little things, not done well, eroding your profitability? The solution is simple. Start a list of all the things that you can do just a little bit better to amaze your customers, grow the business and increase your bottom line.
Get your staff involved. They know stuff! Schedule a 2-hour “Winning is a game of inches” rally (call it anything but a ‘meeting’). Use part or all of this article to create an invitation to the rally and to explain its purpose. Make it fun! Go to the dollar store and get a bunch of little ‘prizes’ for each idea that’s generated. Then, do something, improve something, fix what needs fixing. Get the group’s commitment and assign specific responsibility to specific people. Ultimately, it’s about ‘what will be done, by whom, by when, at what cost, with what outcome, measured how and rewarded how. Then, follow up. Remember, businesses do not die from a single shot to the head. They die, slowly but surely, from a thousand uncompleted tasks. Finally, celebrate and reward success and deal firmly with non-performance.
That’s it for this week…
Stay safe…live brilliantly!
Donald Cooper speaks and coaches internationally on management, marketing, and profitability. He can be reached by email at email@example.com in Toronto, Canada.