Low-Dollar Lou

car salesman

Alec Pendleton(Courtesy of Guest Blogger Alec Pendleton, Big Ideas for Small Companies, powered by The MPI Group)

In a not-very-nice part of the town where I grew up, there was a used-car lot with a prominent sign reading: “Low-Dollar Lou has the Best Buy for You!” A quick look at his scraggly inventory and an even quicker encounter with Lou himself, with his broad smile and his two-handed handshake (the better to remove my watch?), led me to doubt that his slogan was true.

Every survey of buyers I’ve ever seen ranks price well down the list of priorities, lower than such things as quality, reliability, trustworthiness, location, convenience, etc. — yet the vast majority of advertising focuses first and foremost on price. A large metropolitan area might have as many as a dozen Chevrolet dealers, for example, and yet somehow every one of them has the lowest price. Furniture stores, grocery stores, gas stations, pizza shops, and even Lexus dealers want the world to know how low, low, LOW their prices are.

But why? I can only assume these merchants think that price is more important to customers than the surveys report. And yet, does a Lexus dealer really believe that price is the primary motivator of someone shopping for a $60,000 car? So she or he can brag to friends about saving $500?

I, for one, believe the surveys. I’ve seen two gas stations side-by-side, one with prices $0.10 per gallon higher than the other — and both were equally busy. I’ve shopped for low prices when buying cars, and always left the dealership feeling that there was something I didn’t know — that somehow, some way, the salesman had fleeced me. Worst of all, as a salesman myself, in pursuing an order I badly needed for my manufacturing business, I cut the price myself — without even being asked! (I got the order, and promptly lost money on it.)

There’s an adage that opportunity lies in following a different path than everyone else and that applies to competing on price. It’s a desperate, flawed strategy that inevitably leads to a downward spiral of revenues and profits, as a fixation on low, low, LOW prices attracts the least desirable customers. In a sense, competing on price means that success is defined as being the last one to go broke. It keeps you in a constant state of vulnerability, which is a damn unpleasant way to earn a living.

So what about you? Are you caught in the low, low, LOW price trap? Or have you defined your business — and your customer value — in more meaningful (and margin-full) terms? I’m not suggesting that Low-Dollar Lou change his slogan to “High-Dollar Hal will be your Best Pal,” but he might have attracted different customers — and earned a better living — if he’d focused on something other than price.

What type of employer is HGR? Q&A with the Accounting Department

HGR's accounting department
(l to r): Lonnie, Paul and Ed

(Courtesy of Guest Blogger Ed Kneitel, HGR’s controller)

What does your department do?

The Accounting Department is the financial hub of HGR. We work on daily cash reconciliation, processing vendor invoices and customer payments, and preparing monthly financial statements. We manage business relationships with our cell phone carrier, insurance carrier, network administrator, bank, phone company, Internet provider, cable TV provider, and anyone else that receives an HGR check. We support DataFlo, which is our accounting system, and work closely with our development team for support and enhancements. We have an open-door policy, and no issue is too difficult for us to tackle!

How many people work in your department, and what are their roles?

Paul, HGR’s chief financial officer, works on strategic business decisions, customer and vendor relationship management, managing our Austin Call Center and other special projects. Ed, HGR’s controller, manages the day-to-day activities of the department. Lonnie, HGR’s accounting assistant, works with vendors and customers to pay bills and receive payments.

What qualifications do you need to be successful in your department?

We never know when we will be asked to address, and it’s often a time-sensitive issue on short notice; so, we must be flexible and available at all times. We must be able to multi-task, have a good memory (most of the time!), excellent computer skills, an accounting background, understand accounting software, be very well-organized, and have good interpersonal communication skills.

What do you like most about your department?

HGR’s Accounting Department is never boring, since there is something new to do every day — whether we like it or not! We enjoy a challenge; so, bring it on!

What challenges has your department faced and how have you overcome them?

Lonnie joined the department in November 2016 and has been a major factor in the success of the department during the last year.

What changes in the way your department does business have occurred in the past few years?

We have integrated credit card processing into DataFlo, eliminating almost all errors. We also have made major enhancements to DataFlo that have saved time in data processing. We have implemented Smartsheet, a collaborative tool that allows salespeople to view customer wire and PayPal payments, which has eliminated numerous email.

What continuous improvement processes do you hope to implement in the future?

We will be flowcharting HGR’s business processes, which will allow us to spot areas for improvement as we look to upgrade DataFlo. We also hope to further streamline the purchasing process by moving the entire inspection-to-P.O. function to Microsoft’s customer relationship management software (CRM).

What is HGR’s overall environment like?

HGR is always buzzing with activity; there is no other company like it! Everyone is friendly, willing to chat for a few minutes, and genuinely cares about each other, both personally and professionally. We practice what we preach when it comes to our company values!

What is your perspective on manufacturing, surplus, investment recovery/product life cycle/equipment recycling?

HGR serves companies that can’t afford or don’t want to purchase new equipment, as well as companies interested in selling their used equipment. Our business model has proved the test of time throughout almost 20 years in business; so, there is definitely a market for the products and services that we provide. We are constantly moving inventory through our showroom as a result of purchases and sales; so, our “shelves” (okay, aisles and bays) always have new products on display.

Poka-Yoke It: How mistake-proofing devices can prevent human error

tailor

George Taninecz MPI Group(Courtesy of Guest Blogger George Taninecz, VP of research, The MPI Group)

While buying a pair of dress slacks recently, I was surprised to see the department manager using a mistake-proofing device to mark the pant length for tailoring. He placed an upside-down, Y-shaped tool on the floor and against the back of my pant leg.

At the top of the device, he marked a line on the trousers, which established the distance to the ground. Based on that line and the amount of break I wanted in the trousers, the tailor would know where to hem. Poka-yoke for pants.

Shigeo Shingo came up with the term “poka-yoke” (“mistake-proofing” or “inadvertent error prevention” in Japanese) in the 1960s when designing Toyota production processes that would not allow a human error to occur: “A poka-yoke device is an improvement in the form of a jig or fixture that helps achieve 100-percent acceptable product by preventing the occurrence of defects.”[1]

I first saw and used a poka-yoke device more than four decades ago. Every few years, my dad, who was a steelworker, would get 13 weeks of vacation. He often took this block of time during the summer to tackle a household project. In 1973, the job was to apply aluminum siding to our house. His crew was me, my brother, and one of my sisters (my other sister, who was an adult, missed out on the fun).

My dad set the bottom row of siding in place using a level and other means, taking his time to get it just right. Then, with the bottom row attached, each of us would grab our poka-yoke device, which was a piece of wood, shaped like an L. The short, horizontal leg matched the width of the bottom of the siding, and the top of the upright length established the vertical distance for the next piece of siding. We would push our devices against the attached siding and upward, rest the next piece of siding on top of the wood, and my dad would nail the perfectly located piece in place.

Even with the clever mistake-proofing tool, it still took a very long time for one adult and three teenagers to side a house. Fortunately, it also was the summer of the Watergate hearings. When the network broadcasts began, my dad would call it quits to watch. I still associate the southern drawl of Senator Sam Ervin, who headed the Senate Watergate Committee, with much-needed relaxation.

Since that summer of siding, I’ve seen a lot of poka-yokes:

  • In manufacturing plants, where devices prevent employees from reaching into machines and harming themselves or stop workers from selecting the wrong part or attaching a part in the wrong location or manner.
  • In buildings, where elevator doors won’t close if someone is between the doors, won’t open if the elevator is moving, or the elevator won’t move if the weight of individuals within the elevator exceeds a safe limit.
  • At my house, where the washer won’t run unless the door is closed, the mower won’t cut unless the safety bar is engaged, and the garage door won’t lower if a sensor indicates an object is in its way.

I wish mistake-proofing methods could be used for other, bigger problems and put an end to catastrophic outcomes. Imagine if you could apply a poka-yoke to prevent the suffering and dying of people simply because they cannot afford healthcare. Or to stop an evil assassin from stockpiling automatic weapons and killing dozens of unarmed civilians.

Maybe we can. Of course, how and where to apply the poka-yokes would require open, honest, and civil discourse. Real problem solving demands nothing less. Are we willing to try?

[1] Shigeo Shingo, translated by Andrew P. Dillon, A Study of the Toyota Production System, Productivity Press, New York, 1989.

Local manufacturer eliminates noise and moisture issues for the construction industry

Keene noise reduction Quiet Qurl sound control mat
Quiet Qurl® 55/025 MC sound control mat designed to limit impact noise between floors

 

Jim Keene Keene Building Products

How did Keene Building Products get its start?

Keene was started in 2002 as an importer but quickly began development of its production line. Although educated as an accountant, Jim Keene, the founder, became involved in the engineering of the system to produce the materials — a unique plastic extrusion process. Sales were simple since he was involved with many of the customers in the market.

Why was the decision made to locate in Euclid?

Jim’s home town is Richmond Heights, up the hill, but his father and mother went to Euclid High School. Euclid is a great place to manufacture, and Jim wanted to be a manufacturer.

How are the products that you manufacture used?

Keene Building Products is a manufacturer of three-dimensional filament products for the construction industry. Its noise products are designed for construction projects, such as multi-family apartments and condominiums to stop impact and airborne noise, while its building-envelope products can be utilized in wall, masonry, roofing, and foundation applications to eliminate moisture issues.

Starting as a plastic manufacturing company in 2002, Keene has innovated new construction tools in an effort to improve product performance for the market. At first, it only manufactured entangled net products in applications that had coatings and concrete all around them. Today, its capabilities include blending powders and creating chemicals. In addition to plastics extrusion, the company has expanded its expertise to floor-preparation products, below-grade systems, roofing, plastic fabricating and 3D filament.

How many employees work in the facility in Euclid?

30 employees but it will be increasing to 50 in the near future.

Tell us about your building expansion. How many square feet and why?Keene Building Products expansion

25,000 square feet for warehouse purposes that will allow us more room for manufacturing.

Are there ways that the company participates in the community?

Not yet!! We will soon.

What do you think is the biggest challenge that manufacturing currently faces?

Skilled labor

What does the future of manufacturing, especially in Northeast Ohio, look like?

The future is very bright here but we need to educate our young people better. Our schools are not up to par, and our workforce doesn’t graduate ready for the positions we need to fill.

What inspires you?

Helping the people in our organization realize their career and financial goals.

Are there any interesting facts about Keene Building that most people don’t know?

  • Weatherhead 100 four years running
  • Two businesses in the award
  • Holder of 20 patents either issued or pending
  • Family business with other family members as part of the team
  • More likely to sell product on one of the coasts, with full North American coverage and sales in every state
Keene building envelope
Driwall™ Rainscreen 020-1, a drainage mat for exterior wall systems