Bush gives Phil Zimmerman the ultimate “I told you so”

Thats Phil Zimmerman of PGP (Pretty Good Privacy) fame.


Get your PGP while you still can. You may not need it today, but you just never know.

No worries, politics is not the raison d’etre for this blog, but frankly, this isnt really about politics.
5 years ago, who would have thought that someone with (R) after their name would be the one torching privacy?

December retail sales were down…

Or were they….?

Yep, the stats are in for the 2006 holiday season and sales were down, despite early season stats that showed a positive start to the season’s sales.

WalMart reported their holiday season sales were “the worst on record”. What they really mean is that their holiday “same store sales INCREASE” was the worst ever. For them, that wasnt surprising given that “same store sales” numbers fell in November for the first time in TEN years. It isnt just Wally World. All major retailers except for JC Penney reported sales below their Christmas season expectations and reported having to do major discounting. JCP was about .4% above their expectations.

The next time you feel sorry for yourself or your business because of those “awful big box stores”, remember that they dont have the mystery solved. They have a weakness you’ll probably NEVER have.

Actually, they have several:

#1 – BILLIONS in overhead.

#2 – They dont know who their clients are. If they had to contact every single one of their customers for some important reason – THEY COULDNT DO IT.

You, on the other hand, if you’ve been listening…. dont have those two problems.

Think about how you can take advantage of that using the direct response marketing techniques that we talk about.

Stop worrying about Walmart. Start worrying about what your customers want (note that I didnt say “need”).

And remember, the world isnt as bad as Katie would have you think. Really.

Do it FOR me.

I wonder how many of you have the proper tools and expertise to install a free-standing wood or gas stove, or a gas range/oven for the kitchen?

Despite the ever-increasing demands on people’s time, I STILL come across vendors who just don’t get the full-service concept and why it makes them more money than the lazy “Ill carry it out to your car….IF you ask me.” model.

Example: One of the local home stores, who of course doesn’t have a web site (DUH) has this completely wrong. They have a great selection of wood stoves, pellet stoves and gas/propane stoves (in this case, I mean freestanding fireplace types, not kitchen stoves).
If you go into this store and attempt to purchase a stove (and we’re talking about a $1000-2500 purchase), they will help you…. carry it to your vehicle. That’s it. They don’t install. They don’t remove the old one. Put yourself in the place of any one of the following people: busy executive, 2 job couple who value their limited weekend time, single mom, young married couple, tool-challenged guy, older couple, and similar.

We’re talking about people who don’t have some combination of the time, the vehicle, the expertise and the strength to load the new stove, carry it home, put it in the home, remove the old stove, install the new stove, hook up the gas (if necessary), cut an exhaust hole and install the chimney/stove pipe/exhaust, carry the old stove out to the vehicle (if necessary), and take the old stove to the dump (if necessary).

What in the world is going through your mind when you sell $1000-2500 items like a 6 pack of beer? Here’s why this is such a big mistake: If you DONT do these things, and someone else does, that someone else is going to get a lot of people’s business because there is a substantial number of folks out there who simply dont have the time, vehicle, strength, expertise or DESIRE to do all those install tasks.

Back to the example store…the in-store people are very experienced. They are experts in their topic, yet they are hamstrung by inane management policy.

Down the street from this store, there’s a full service store (more than 1, in fact). For an extra hundred bucks, they’ll bring the stove to your home, remove the old stove and take it to the dump (if necessary), install the new stove and, if needed, hook up the gas, install an exhaust port, stove pipe and/or chimney as necessary. Note that if a gas fireplace or free standing stove is involved, a certified plumber has to hook up the gas in many states.

Naturally, the full service stores also provide warranty and repair service for the stoves. Now, if you do this right, its an income stream, but unfortunately, no one does.

When I say right, I mean the stove store creates a subscription program. WHAT??? You cant do that, only magazines and newspapers have subscriptions!!! (sorry, that was your brother in law telling you that you cant do that, lets move on). How does the subscription program work?

How about this: During the winter (stove use) months, you offer to check on the stove at least once in the middle of the season, plus a beginning of season and end of season check. 3 visits, say $99 per year (you figure out what price makes sense for you). Remember, the best time to sell is when you’ve just sold someone something.
For that $99, you stop in 3 times. You check the function of the stove, spend $15 worth of time cleaning the stove pipe (more if its a chimney, since you have to climb up on the roof – but this is far less common in free-standing stoves), vacuum out the junk in the stove, make sure everything is safe, and make an appointment for the next visit (which is already paid for via the $99 annual fee). Before you leave, you give them a little gift, a refrigerator magnet with your smiling face (no one does this) and your phone # for service emergencies, or a little cheapo mini-broom, or a bottle of juice to clean the glass on the stove, just dont be boring about it.
You sell this as an upsell during the purchase. Some folks will bite, some wont – but if you are a full service store, you already have the staff so you may as well accept the cash flow. Here’s the secret that many people miss: Because you are there 3 times a year (or whatever) to check, adjust, clean and do any quick repairs – you are their “official stove repair shop”. Who do you think will be called when they need repairs, build a new home and need help with a stove, have a friend who needs a referral for a stove, and so on? YOU, because you are the one visiting their home 3 times a year to take care of their stove and keep it functional and safe.

We recently had the SAME type of experience when replacing a gas kitchen stove/oven. One store (Sears, you know that place “where America shops”) was the put-it-in-your-car-and-wave store. No install service, no nothing. Nowadays, most gas stoves are dual-fuel, meaning the range is gas and the oven is electric. So not only do you need plumbing skills to hook up natural gas or propane (and know the difference at install time – there’s a very important difference you MUST know) AND you must have electrician skills because of the dual fuel aspect. You may even have to install a new plug for higher voltage.

The other store, Burton’s Brand Source (a local retailer, http://www.burtonsbrandsource.com), offers full service and even managed to let us talk them down over $400 on the stove + included installation and removal of the old stove. At no extra charge (yeah, its in the profit).

Which is more attractive? The curb drop off, or the full service install? Which store got my business? The latter, of course.

Which store are you? The latter or lamer?

UPDATE (March 4, 2008): Remember that store that doesn’t offer installation? They’ve now gone out of business. They’ll blame Home Depot, or the economy (oh my, it’s a recession!!), or anyone but themselves, but you know the real reason.

Can you sleep when the wind blows?

I read a story the other day that reminded me about one of our business building concepts: the ability to put your business on autopilot. CRITICAL. This is my version of it, except I changed it a bit, so that you are looking through the lens of the kind of business that some might think is immune to strategic thinking, business improvement and the like. My point in doing that is to remind you that your business is NOT DIFFERENT. What applies, applies.
A young man home from college is out of work and walks up to a farmer’s place in rural Iowa, looking to earn some money before he heads back to school in the fall.

He knocks on the creaky wooden screen door, and soon a face appears at the door.

The farmer is an older guy, with a face wrinkled and tanned from years of hard work in the fields. When he shakes the young man’s hand, the young man can easily tell that the old guy is strong as a mule, despite his age. Kinda reminds me of my grandfather (RIP, Grandaddy).

Anyhow, the young man walks out to the barn and talks for a while with the farmer. The farmer takes a liking to the young man, but just isnt quite sure about him. Finally, as they sit down in the kitchen for a glass of tea with the farmer’s wife, he sizes the young man up with one last question: “Why should I hire you instead of going to town and finding a farm hand?”

The young man thinks for a moment and says “I can sleep soundly at night when the wind blows.”

The farmer studies the man’s face for a moment, still not quite sure, but extends a tan, wrinkled hand and says “Ok, we’ll give it a try.” Once the hand leaves to go get his things, the man’s wife lights into him, asking him what kind of comment that was and she makes it clear that she doesn’t think the new hand will work out.

Weeks go by. After being taught the right way to run the equipment, take care of the animals and tend to the crops, the hand is working out fine, doing his job well. A quiet young man, he spends his evenings reading in his room in the basement. For some reason, the farmer’s wife doesn’t care for the young man, but she can’t put her finger on the reason. She and the farmer discuss it almost every day, and the farmer convinces her daily that it’ll be ok. She’s not convinced, but she’s willing to give it some time.

Meanwhile, the farmer has been spending more and more time in town at the library and at the feed store. He’s taken a strong interest in studying new crops, new farming techniques, and the futures market. The hand is taking care of the heavy lifting back at the farm, but his wife is a little worried that her husband is letting the hand have too much run of the farm.

One particularly hot humid day, storm clouds started to form towards evening. It didn’t come on in a hurry, but it was obvious all afternoon that something was brewing – and this is tornado country. It appears that a long, hot day of work is going to end with a storm to cool things off. The farmer had brought some ice cream home today, so they settled down on the porch to enjoy a cool, sweet snack. The wife notices that the farmer left one of the windows down on the truck. Everyone has their hands full enjoying the ice cream, so the farmer says he’ll take care of it when they are done. An hour or so of eating ice cream, reading the paper and chatting about what’s going on in town causes everyone to forget the open window after a while.

As night comes, the wind changes direction and kicks up, steadily growing stronger. A few hours later, after everyone is in bed, the storm hits. Wind pelts the farmhouse and the barn, waves of rain turn the dusty driveway into muck and feed the thirst of the crops in the fields. The storm gets stronger, thundering and lightning more frequently and with stronger, gustier winds. The farmer’s wife is worried. Their hand is still down in his bed in the basement, sleeping deeply. She finally confronts the farmer with that face – the farm hand is lying in bed, being lazy, not worried about what is happening to the barn and the animals, their farm equipment, or the truck they drive to town.

The farmer, finally concerned that the hand is not doing his job, pulls on his galoshes and a jacket and runs out into the storm to check on the animals, close the window on the truck, and button down anything that was left open.

A few minutes later, he steps back onto the back porch of the farmhouse, where his wife helps him out of his soaked jacket and galoshes, and hands him a towel to wipe his glasses and face. Shortly after the farmer sits down to peel off his soaked coat and boots, marble-sized hail starts to fall for what seems like forever, but it has only been a few minutes.

Once he regains his composure from being pelted with rain and wind, she asks him, “I sure hope that hail didnt ruin the fields. Did you get everything fixed up?”

The farmer slides his glasses back on and takes his wife’s hand. He looks her in the eye and says: “The truck windows were already rolled up. The animals were in the barn, blinders were on the horses, all the gates and doors on the barn and chicken coop were closed up and barred. The tractor was pulled into the barn. Bags of fertilizer and seed that were sitting out in the sun for tomorrow’s work were covered with a tarp, tied down around them. All I did was walk around out there and get wet.”

She looked at him without a word for a moment and said “Lets get some sleep, it wont be long till morning.”

The farmer’s wife figured out that the hand felt he could sleep soundly at night when the wind blew because he knew he had taken care of his important tasks and everything is safe because he made sure of it before stopping for the day. At the end of the summer, she knew she and her husband would miss the young man.

When morning comes, they find that 2 of their crops are destroyed – beat to pieces by the hailstones. When the farmer and his wife return from the fields and sit down to talk about it, the farmer is relieved.

Their finances would be safe because some of the time he spent in town was used to learn about hedging crops on the futures market, a technique used primarily by savvy farmers who want to reduce their risk in an already-risky business.

Instead of spending all of his time in the fields and on his equipment and animals, the farm hand’s work allowed him to learn enough to take steps to prevent a terrible loss.

How does this relate to putting YOUR business on autopilot?

Certainly the farmer had to be sure that the hand did the work in the fields every day, as well as tending the equipment and buildings, etc. He hired the hand to help him put his farm on autopilot and he TRAINED him how to do the day to day work around the farm so that he could work on things that were more important to his business – and ended up saving it from financial disaster.

Don’t think that just because you are a “one man show” that you cant take advantage of this business success strategy. You can, and in fact, it’ll most likely help you take that next big leap.

Look around at your business. Examine every little thing you have to do. Look at the important work that isn’t getting done because you are working FOR your business, rather than ON your business.

Can your well-trained staff sleep when the wind blows? Can you?

I caught the USPS getting it.

Well, the shipping and mailing frenzy is over for another year.

I kept a close eye on vendors this year, as we intentionally had one of those fashionable “small but meaningful” Christmases this year, so the blur was less blurry. For what it was worth, the “small but meaningful” actually worked out nicely.

Highlights from this year’s Christmas vendors:

Amazon: Solid. I ordered several books later than I should have (morning of Dec 21), didnt pay for overnight delivery – and Amazon had them there by the Friday before Christmas. Their promised delivery date? Dec 27-29. Underpromise, overdeliver.

UPS: I have never been a big UPS fan. I think this stems from the residential side of their service, because their business to business address service over the last 6 months with me has been spectacular. Would I like Worldship to just update itself and not annoy me with 37 messages every time it needs to download a new fuel surcharge table? Sure. But thats minor compared to their peak season Christmas performance this year. I dropped off 2 fairly large packages at UPS (actually, the UPS store here in Columbia Falls) on the evening of Dec 21. Both were shipped UPS Ground. Both were promised on Dec 27. Both arrived on the Friday before Christmas (one to Missouri, one to Cincinnati).
Montana Day Spa: Bought a gift certificate for a massage for someone at 415pm on the Friday before Christmas. Busy time. Despite that, I was treated with care, a touch of humor (in response to mine) AND with the closing line of “We’ll take special care of her for you.”. Now, they didnt need to say that, but they did. Nothing major, but a little touch that I still remember over a week later. How many little things does YOUR staff say that a client remembers a week later?

And the surprise? The United States Postal Service, at least the Columbia Falls branch.

Since Christmas fell on a Monday, that made incoming package delivery a little worrisome for many. At our local post office on Saturday morning before Christmas, we had a pretty good line of people with package slips (rural areas have a much higher PO Box use rate for residential customers than do urban areas). I spied a sign taped up in several places that quite simply blew me away. “We will be open for PACKAGE PICKUP ONLY from 830am – 1030am on Christmas Eve, SUNDAY Dec 24”.

Now that was a nice, considerate touch. Something they clearly didn’t have to do.

Where you are, the USPS may not have the level of service you’d like to see, but out here in Rural America – its pretty good. I can routinely drop a letter in the mail on Day 1 before 5pm, and will find out (via the response) that it was delivered in Billings or Wolf Point (ie: at least 400 miles away) or such on the very next day. Its a dirty little secret. Direct mail works, if you know what you are doing.

Would you rather your customers were satisfied or loyal? How about your WIFE?

When I saw Jeffrey Gitomer speak in Spokane a few years ago, his normal level of brash interaction with the crowd was typical for him: laced with his New Jersey style shtick and humor. He’s a funny guy, but he’s always making a point with his humor.

At one point, he asked the crowd if they would rather their customers be satisfied or loyal. About half the crowd raised their hands for each. Then he asked the crowd, “Would you rather your spouse was satisfied or loyal?”

Amid lots of laughter, he made his point.

That’s the focus of “Customer Satisfaction is Worthless, Customer Loyalty is Priceless”.

Gitomer’s books are always an easy, quick, entertaining read – and they’re always worth the price of admission. You may not like Jeffrey’s New Jersey style humor, but you cant argue with his success, nor his ability to get a point across about sales and customer service.

I stumbled across Jeffrey in the airport a while ago, and in person at the luggage carousel, he’s no different than in front of a crowd. Funny, yet sincere, you know he wants you to succeed. Pick up a copy and pass it around to your staff, or buy each of them a copy. You’ll be happy you did and so will your customers.

Never Eat Alone

A quick, easy read, Ferrazzi’s “Never Eat Alone” covers a slew of great tips for not just being another guy tossing business cards around with a leaf blower, but truly getting and giving value from from networking efforts. Certainly, the importance of networking and nurturing business relationships is known to anyone with a little common sense, but Ferrazzi’s rapid climb in the “big time” consulting world is worthy of watching and looking for little takeaways to improve your ability to not only network, but be a better resource for those you network with.
Lots of dogears in this one, though not as many as “Focus” and “Execution”.

Execution – The discipline of getting things done

Larry Bossidy’s stories of the struggles to maintain the focus and discipline of execution at GE, Honeywell and elsewhere hit home. What was particularly interesting to me were the anecdotes about EDS, given that I worked there before GM bought EDS and continued to work there during the adjustment period when it seemed like 75% of the company was moving to Detroit.

Anyone who was paying attention during the subsequent years and saw what GM did to EDS was not surprised to see them pitch Ross off of the board. You see, Ross’s lips never saw a backside, and with good reason – and that just wasnt how the board did business. So…EDS lost focus, their execution suffered, as did their stock. Oddly enough, several years later when Brown was brought on as CEO to turn things around, the story in Fast Company about his efforts motivated me to email him about my experiences at EDS. Amazingly, he actually replied in prompt fashion, and not with a canned response from his admin.
Back to the story at hand, this book is right up there with “The Power of Focus” in the dogear department. It might be easier to count the pages that I didnt dogear. Its a very easy read, primarily because its about the stories of the experiences of the authors, rather than a dry management treatise or a touchy-feely discussion that we so often find.
One of the interesting (and perhaps rewarding in a pathetic way) things about this book besides the laundry list of strategies for becoming and STAYING more productive is the perspective of the C-class exec at major corporations like General Electric (GE), Honeywell and EDS (Ross Perot’s Electronic Data Systems) who struggles with the same things that entrepreneurs struggle with. Feels a little better to know that it isnt just kitchen table entrepreneurs that have to work on the discipline of execution:)

Yes, I know its not Ross Perot’s EDS anymore, but I worked there when it was, so it’ll always be that for me…

Just get it. A very good read. Not at all dry, and full of quality takeaways that you can put to use.

Frugal and smart

Frugal’s is a drive-up, no-sit-down burger place in the Northwest.

Unlike some parts of the country, around here – employees are hard to find.

Well, more accurately, good employees who are willing to show up on time and work are in short supply. All over Western Montana, businesses are having difficulty with staffing. Construction companies offer $28/hr one day and find that their guys went to some other job for $29/hour. Yeah, it says something about the person involved, but the point is that they are struggling.

On the other hand, Frugal’s is paying more and requiring more of their people.

Instead of paying minimum wage, they start their people at $7.50 an hour.

Here’s the smart part: If you meet certain criteria for the last pay period, your pay is $8 per hour.

The criteria might annoy some because they are paying for behavior that simply should be normal, but they are doing what it takes to make it happen. Others just wring their hands over it and complain about it.

To make $8 an hour for the last pay period, Frugal’s people must 1) show up for all shifts, 2) show up ON time for 100% of your shifts, and 3) be a friendly, enthusiastic team player who is friendly to their customers.

So instead of harping on their people all the time about showing up, they simply pay them extra to do so. Easily saves .50 an hour worth of management time, much less gray hair and both staff and management morale.

The Blog Moving truck came.

If you’re using FeedBurner, you may have noticed that the blog is being forwarded (by them).

This only happens for 30 days, so please subscribe directly here.

PancakeBunny just didnt speak directly to what I blog about, despite the initial kinda-meaningless story referring to the Pancake Bunny image customer service response, PLUS there’s the SEO benefits. Ebb and Flow is one of the finest if you are wanting a digital marketing company to work for you.
So…I’ve moved the blog to my main business site. The SEO savvy out there understand the why – the rest of you need to think hard about moving external blogs back to your main site, assuming your blog is in context with your business.

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