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By Alan Oakes

Where do you go now?

f, t a time when there may be a glimmer of hope that we've reached the baseline of an .fa'improved market, now is the time to start planning for the aftermath. I have always said that if you survive through the tsunami we have gone through, at some point there will be decent business again for those left behind.

There is no doubt that all of us have been forced to look at our business performance these past two to three years with a more detailed and critical eye than ever before. While our magazine readership is made up of companies of all sizes, the majority are not large enough to have access to a team of business analysts or outside consultants. So perhaps we need to occasionally be reminded of time{ested business principles that challenge the way we should think about our businesses. Good mentors or advisors are often invaluable in driving you to evaluate areas of your business and to challenge yourself in areas that you may not feel strong enough to tackle. Having a second set of eyes can help you through difficult decisions that you do not feel comfortable discussing internally. But choose your advisors wisely. There are some pretty well-paid idiots out there who can easily take you down the wrong path.

while we are heavily focused on handling day-to-day operations and putting out fires, we do need to have a plan to guide and drive our businesses along with actions needed by whom and by when. A plan without accountability, goals and specific measurement points will never succeed. I remember one ofmy worst business decisions was about l5 years ago in the book publishing industry. I was coerced into developing a new software product. up front, I didn't agree with the decision. I was c.e.o., but the business owner was insistent. It was a new industry for us, and I was not sure we had the talent internally to produce and market the product. But, I set up the teams, goals and budgets, and we happily got under way. As we developed the product, I realized it was a product I myself wanted and needed. As we started seeing beta copies, I began to believe in the product and started dreaming of all the new dollars it would bring in. I was convinced that we had a winner, despite the fact that there was a clearly established No. I in this space.

But this was not our normal business, and we didn't understand all the pitfalls. The product looked great, but we all agreed if we were to win we needed to improve it. During that process, we generated great ideas on how to extend the reach of the product-issues that needed to be worked on before we launched. Delays started building, costs mounted, but we still believed we had a winner. In the meantime, new competing products came out, our retail price became no longer feasible, and we had not done enough externally to determine if we would get bought by the chains and what we would have to give to buy shelf space. The end result, after over $l million of development costs, was that I finally and belatedly called a halt and wrote the project off. The moral was that we should never have started in the first place. We had fallen in love with the product and become too emotionally involved. We had not been objective enough nor understood how competitive the market was. More importantly, our egos led us to believe that being No. 1 in our own space was going to mean something in the new space. It meant diddlysquat!

As you can see, understanding financials and having time for critical planning along with real-cost analysis are critical for every business. Lack of attention to the fundamentals has destroyed many a company, large and small. Moreover, being product driven-as opposed to market driven-usualty leads to abject failure.

Analyze your products and services. Hopefully you have a cash cow that is in demand and makes you money. This is where to spend your investment and marketing dollars. Don't waste money on propping up dead or dying products. Invest in and protect what makes you money. Understand how it makes vou monev. and do evervthing possible to defend your turf.

Lastly, understand what your priorities really are. Times change, and your way of doing business may have to change as well. Be open to learning from others, and that cannot be done in a vacuum. No one is an expert in all aspects of business. Learning what others are doing and how should be a vital practice to help vou succeed in the future.

Bpii

Building Products lfigesr

www. bu ild in g-prod ucts. com

A publication of Cutler Publishing 4500 Campus Dr., Ste,480, Newport Beach, CA 92660

Publisher Alan 0akes ajoakes@aol.com

Publisher Emeritus David Cutler

Editor David Koenig dkoenig@building-products.com

Associate Editor Karen Debats kdebats@building-products.com

Contributing Editors

Carla Waldemar, James Olsen, Jay Tompt

Advertising Sales Manager Chuck Casey ccasey@building-products.com

Administration Director/Secretary Marie 0akes mfpoakes@aol.com

Circulation Manager Heather Kelly hkelly@building-products.com

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