a recession going on, at least where I sit, and
my primary concern these days is drumming up new
business. I figure I'm not alone, and so I really
ought to apply my expertise (technology) to the
problem of staying alive in tough times.
General Comment: Accelerate!
If your business is fortunate enough to have entered
the recession (I can use the R-word now, it's
official) with a strong balance sheet, a lean
workforce, and solid sales, now is the best time
to accelerate away from your competition. Right
now, it's dramatically cheaper to make improvements
to your business: the cost of capital is lower,
suppliers are more willing to make price concessions,
and qualified people are looking for work. And
your competition is less able to match your investment
in the future.
Getting Your Customers to Pay Faster
Every smart businessman knows exactly how long
it takes his customers to pay their bills. And
when times are tight, companies "manage their
payables," delaying payments as long as possible.
If you are a QuickBooks user, you can e-mail invoices
directly from QuickBooks, and get paid online,
either by credit card or direct transfer (see
QuickBooks Online Billing at www.quickbooks.com).
And in keeping with my last column, this service
also allows customers instant access to their
invoice and payment history on-line, which may
cut down on the number of calls your bookkeeper
needs to handle.
New Products and Services
Unfortunately, I don't know what business you're
in, making it hard to write down specifics. But,
think about a product or service for which your
current customers would gladly pay, a "point
of pain," if you will. What are the obstacles
to delivering that product or service? Clever
application of technology may allow you to satisfy
your client's previously-impractical needs. Remember,
technology doesn't have to be the product. Think
it can't be done? A small brainstorming group
consisting of you, your sales people, a trusted
client or two, and a technology expert may show
As long as I'm talking about the needs of your
current customers, I strongly encourage technology,
specifically email, as a way to stay in touch.
Do you have an email contact for each CEO or owner
with whom you do business? You should! Existing
customers are the best source of business, and
a monthly email newsletter with truly useful information
(case studies, application notes, new products,
incentives - but please, skip the sales hype)
is an easy, cost-effective way to stay on their
I would suggest, as a modest goal for this year,
investing in the ability to notify each of your
customers of important news simply by sending
an email. Why? Because communicating with your
customers is the lifeblood of your business, and
presently, it's an expensive proposition (unless
you have only a handful of customers).
Are there still some Luddites on your client list
who don't have email? It's easy enough to add
an email-to-fax "gateway" which causes
email to be automatically translated and sent
to a customer's fax machine. This removes the
aggravation of two separate delivery methods.
We'd all like a machine that we could plug into
our phone, which would cause the phone to ring
with orders from new customers (preferably with
a dial on the front, to adjust the rate!).
I don't have such a machine, but I do know that
potential customers need to be able to find you
(and what you have to offer them). More and more,
people research business decisions via the Internet.
Are you visible? And if you are, are you more
visible (and informative) than your competitors?
Ask yourself these questions:
someone knows my company name, can they find
us on-line (even if it's just to get our telephone
someone wanted our product/service, but didn't
know our name, what would they be looking
there's an on-line directory for our industry,
are we listed in it?
Try it for yourself. Are you happy with the
The Internet can also be a way to identify potential
customers. Try searching for your product on-line
(e.g. "high-density polyethylene wrap").
You'll see two kinds of results: people who sell
that product (who may have client lists for you
to review), and people who are using that product
(potential customers). Don't forget to search
for problems ("keeping drinks hot")
as well as solutions ("Styrofoam™ cups")
- your customers think in terms of their problem,
not your solution.
Do your customers fall into a well-defined category?
You may be able to reach them by advertising in
targeted on-line media ("ezines"). Surveying
your customers about their on-line reading habits
will help you make this choice. The costs are
low enough that it's a worthwhile experiment.
Think Like The Big Guys
Right now, the big guys are focused on supply-chain
management. In other words, they are trying to
reduce costs at every step in the chain from raw
materials to the product in a customer's hands.
The best-known example is Dell Computer, which
builds computers to order on a grand scale. They
know exactly what parts need to be ordered, and
when (reducing inventory costs). Parts orders
are placed automatically with their suppliers
as finished-goods orders are placed (reducing
purchasing costs). Dell receives payment when
they ship (via credit-card, typically), and pay
their suppliers on terms, which has a dramatic
positive effect on their cash-flow.
Do you have to monitor inventory levels and place
calls to suppliers manually? This takes time,
and (when done incorrectly) ties up your cash.
Technology is available to help deal with this
problem, and better still, your supplier may already
have it. For example, medical and dental supply
houses provide physicians and dentists with automated
management of their supplies.
Don't forget this important fact: chances are,
someone has already encountered the problem you're
facing, and, if technology offers a good solution
to that problem, built the technology you need.
The Internet makes it easier to search out people
who've already solved your problem.
Reducing cost is on everyone’s mind. Take a business
magazine faced with the challenge of turning out
their annual Top Companies listing. As
you might imagine, it’s a time-consuming exercise
in data-gathering. Rather than apply brute force,
this magazine made it possible for
companies to update their information via an on-line
form. Moreover, this magazine can target each
company or professional with an email
containing a link to the secure form, pre-filled
with their data. So most people simply receive
an email, click on the link, and are done. The
result is more accurate and information from more
companies, and less cost to produce than any previous
The key ingredients here? A time-consuming
repetitive process, a database of information, an
add-on to the database which can send
individualized emails, and a little bit of Web
programming expertise to handle the form. The idea
for you? Look at your business activities to
identify repetitive activities – they are the best
candidates for cost reduction via technology. And
note again the use of email to contact a large
No Free Lunch
None of the above ideas is without cost, and when
business is slow, it's hard to think about investing
in technology. But prudent choices now will really
pay off as business recovers in the coming months.
Contact your performance measurement specialist
to see how you can improve your company's processes
to improve profitability.
Michael Duffy writes the monthly technology
column, Tech Talk, for North Bay Biz Magazine
(http://www.NorthBayBiz.com). His Web site
URL is www.mikeduffy.com. © 2002 Michael
E. Duffy & Associates. Reprinted with permission.