Cover story Garry Bartecki
Much needed plans for 2022 There is little doubt that 2022 is going to be a handful to deal with. David Baiocchi laid it all out in last month’s issue and every bit of what he said is going to take place in some form in 2022 and even 2023. To make matter worse, from the time David’s article appeared in MHW we have a new highly contagious COVID-19 strain to deal with which could put you back six or nine months, which in turn could offset some of the changes you made to your business to get back on track to a more profitable 2022. Not only is the new Covid strain a problem but when you add in the supply chain issues that continue to plague us there seem to be more roadblocks in front of us than pathways to profitability and cash flow. And just so you know, Dean informed me I had the cover story for January and the topic should cover what dealers will face in 2022 to the best of my ability. I said that would not be a problem. The next day, however, I received a copy of David’s article. Needless to say, I am thinking David covered most of what to expect in 2022, leaving me to follow up where he left off which in my mind is a tough thing to do. So, I did my homework and am taking a shot at projecting what roadblocks you will face in 22 along with ideas on how to turn problems into opportunities. Hopefully, I will provide you with some paths to explore to improve sales, profits, and cash flow. So, let us get going. First of all, let us stop talking about 2019. I keep hearing people say they wish they could get back to their 2019 operating results. Well, FORGET IT! It is not going to happen because too much has changed in your business world that OHIO RACK will not permit a return to the past. If you want to understand what I am We BUY & SELL talking about go back and Portable Stack Racks read David's article and then Flexible Packaging tell me how you would use NEW & USED your 2019 business strategy 800-344-4164 to correct your problems and Fax 330-823-8136 Email: ohiorack@cannet.com
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www.MHWmag.com
January 2022
put you back at 2019 operating results. Not going to happen. Equipment and parts are somewhere on a boat or on a truck (if you are lucky). A recent article written by a 35-year truck driver states that nonunion drivers who get paid per load or some other metric will not go to the ports because they wind up losing money on the deal. His conclusion was that this condition will continue for years to come. So do not expect to replenish your new unit inventory any time soon. The labor problem also seems to continue even though there are plenty of jobs available. People want to work from home. People want to avoid coming in contact with the virus. People want more money for what they do. All these factors place you in a tough position. And then we have inflation to deal with, which many of you have not had the pleasure of dealing with the negative impact of inflation. Your inventory and parts cost increase. Your other expenses increase. Payroll increases because employees need to cover the inflationary cost increases. How do you plan for these scenarios and still have adequate capital to stay afloat? That is the question to which every one of you will have a different answer, depending on how much capital you have available, the markets you are in and the customer base you do business with. Quite frankly, you are starting with a clean slate when you plan out 22 because all the variables are nothing like what you faced in the past with fewer solutions and resources available to make meaningful changes. If I were sitting in your office, I would suggest using a zero-base budgeting approach to attempt to zero in on areas where the spend is too high or the returns too low. There is little doubt that technology will be part of this correction even though part of the problem is to figure out which technology to adopt. But no matter what the technology has to provide benefits and support to customers as well as your company. Otherwise, you are wasting your money.
