Happy Christmas

Seasons greetings to all. I have been working on the next fortune – only it is nothing I can share until everything clicks. Hopefully I’ll blog about it afterwards.

Between now and 5 Jan 2004 I hope to do nothing related to business or investing. Well except for some reading, planning and thinking. The aim of this time off is life balance. By deliberately taking a break I want to return refreshed and enthusiastic for the huge challenges 2004 is offering.

Will my business survive? Will my investments work? Will my personal life grow and be energised? Questions for next year.

As usual email or comment any questions.

Hopefully in the hiatus I’ll have a chance to fix things around here. But not if it starts feeling like “work”. The mantra is life balance.

Winning Business

As expected, the traffic to the warehouse sale has dropped off over the last six weeks. Two weeks ago, I asked our advertising sales rep at Fairfax Community Newspapers to radically change the look of our ads. We really liked the first design they produced for us, but it was time for a change.

We did consider using an advertising agency in the beginning but thought we’d give Fairfax a go first.

Sadly, Fairfax acted as if they were a one trick pony. We got variations on a theme. The same font, the same photo style, the same copy. Then we told Fairfax the same thing. They asked us to produce some ideas. Now these were the guys who said they were the professionals and had designed all these ads they showed us! Call me naive, but I got the sense that now they’d won the business they wanted to do as little work as possible.

Eventually one of our staff sat down at with a publishing program and knocked up a brand new layout in 10 minutes using a clip-art Santa and default fonts. We emailed and faxed it to Fairfax with radical change!!! on it.

Fairfax used a different clip-art Santa (more traditional in my opinion), redimensioned the ad to fit the space. They used almost the exact same colour scheme. I now have one extremely annoyed staffer, “they’re supposed to be the experts?” she cries.

So this week sales are up 45% week on week. The weather is a factor – the rain stopped bucketing down. Christmas is factor: second last weekend before Christmas – early shoppers are finished, late shoppers haven’t started so some make the trek out to a warehouse sale instead of a mall. That this is our seventh weekend open lead to strong repeat business. But mainly I put it down to the changed ad. We saw a lot of new customers.

I believe the original ad design drew one subset of customers. It couldn’t draw people who didn’t notice it. Playing with subtle design changes could not attract customers who skimmed over it the first 4 times.

I discuss this with our Fairfax rep, reminding him that they claimed to be experts and had done all these designs. He offered that it was a busy time of year and the design team didn’t have the time for it. Not the answer I was looking for.

Anyway I talked to a supervisor at Fairfax. She said that sending a layout is often interpreted by the designers as an instruction. Fairfax are preparing 5 new layouts this weekend for our 2004 sale. We’ll pick the 3 best and roll them through changing every 3 weeks.

The cynic in me says Fairfax want to do as little as possible to keep the business. After all they won it in the first place without a lot of effort. Realistically I think it is another case of finding how to communicate with another business. We know our business, they know theirs. Once we both understand how we do things it will go smoother.

So I’m going to spend time educating Fairfax on what we do value and what don’t care about. But I think I’ll only give them one more chance before I take my business elsewhere.

Business Software Blues

I’ve decided I cannot run the company for another year using our dumb software. We use MYOB for financials and a custom written stock control system that doesn’t integrate to anything. Because we run multiple warehouses and supply consignment stock to distributors, MYOB can’t handle it.

We can go for a proprietary solution. But that would require extensive customisation and the entry price on these advanced ERP/Financials packages is shocking. Paying $500 to $2,000 for a Bank Reconciliation module is crazy. I’d still need modules for at least General Ledger, Accounts Receivable, Accounts Payable, Inventory.

We’re a small growing company so I’m looking for some open source solutions. We’ll probably put the customisation out to tender on the internet. That should be interesting.

In the meantime I’m evaluating Compiere ERP+CRM. If anybody has any suggestions I’d appreciate it.

Shutting down WA

I shut down my Perth warehouse last week. The week before they had reported sales of $74.55. For that I paid rent on a warehouse and a retainer for the Manager. The bloke over there seemed more interested in getting toner for the photocopier than generating sales or distributors.

The warehouse sale in Sydney keeps me busy. We’ve just started a warehouse sale in Brisbane. Neither I nor Sam (my National Sales Manager) had time to fly over to Perth to shut it down. But it needed closing before December 1.

Sam thought it would take at least a week (he’d closed the Victorian Warehouse three years ago). A friend had long ago suggested I hire Forstaff to send a bunch of casuals in to do it.

I called Mick, Forstaff’s WA manager, who sent Gordon around to estimate the job on the sly. Gordon figured 3 guys would take no more than 3 days to pack it all up and load it on trucks to the east coast. Gordon also had a chat with my WA manager, who didn’t know what was coming but made an unenthusiastic impression anyway.

Wednesday morning local time I got on the phone and broke the news to my WA manager. We just couldn’t afford to run that office anymore. I sent Gordon and the three casual storemen and packers in on the other line and asked my WA manager to hand him the keys, gather any personal effects and go home.

I’d never fired anyone by phone before, it didn’t feel good, but it had to happen to save the whole company.

The Forstaff gang managed to empty the warehouse onto 73 pallets in three days. Great work and at a lower price than me flying over to supervise.