How do you handle "too much" business?

[Bill Stearns]

Greetings.
This probably sounds like a really dumb question. Or, maybe, like a good problem to have. But, just wondering (if you are a one-man engraving shop as I am) how do you handle having "too much" business? (Figure I can't be the only one in this boat?) I'll call my situation the "Goldilocks Syndrome". Too small. Too large. Just right. Remaining small, it's been a constant struggle to survive. (as has been my case 'till recently.) Trouble is: My days of wanting to run a "large" business, well, they are behind me now. (i.e. new 'n more equipment, hired help, etc.) Nowadays, I'm striving for the "just right" level; tough to maintain as more 'n more organizations are discovering me! ("Just Right" meaning: enough business that I'm not sweating bills - but, not so much that I don't have a "life" 'way from work: time with family, etc. This up-tick in business wouldn't be an issue if I could space projects out. But, as you know, people 'n organizations come running in needing their items yesterday! - the pressure on! And, to turn 'em away is to risk losing their business for good. Longer days, longer hours my only solution? Mostly, just wondering if, by chance, I am overlooking a different, more creative solution? Or, if I'm looking at this all wrong? Would appreciate your advice.

Bill

[Anthony Scira]

Raise prices ?

[Khalid Nazim]

Only do high margin business. Raise your profit expectations by 10% and only take jobs that pay that much margin. Also, pay yourself more per hour. Buy a Trotec Speedy 400 80W so you can do the work in half the time

I get this problem during holiday season and I tackle it by only selling high margin items.

Regards
Khalid

[David Somers]

Bill,

First....congrats!!! That is good news to hear!

So....I guess you have a decision. If you have more business than you can do as a one man shop it would seem like you have a choice.
You could get a second laser, or a larger faster laser that can do more work more quickly under the supervision of 1 person. A second laser seems a bit dangerous to me given the risk of flair ups depending on your materials and your ability to keep both machines under a close eye for fire? At first though it would seem better to have 1 larger faster laser that can handle your increased job load.

Or....you could get a second laser and hire a second person. Of course that entails its own problems. training, supervision, all the issues associated with payroll, etc. Plus buying another machine.

Or....if you have doubts if this is a sustained increase in workload perhaps you can find a way to contract out the extra work for a while as you evaluate what is going on?

Keep in mind I am not a business person Bill. Take anything I say with a big grain of iodized salt. I am just brainstorming with you. And excited for you too! Glad to see things like this coming together for you!

Dave

[Mike Null]

Bill

I have had a $25 minimum fee for over a year and it helps to weed out those "retail" customers and allows me to concentrate on commercial work.
That allows me to schedule my work to their needs and so far they've been quite reasonable about completion dates.

I rarely charge a rush charge but I will do it if it is warranted.

I also have an experienced part time helper who can run the equipment and work with Corel. I schedule him as needed but usually only a few hours a week.

[Mark Sipes]

I would analyse what part of the business is slowing you down... Dealing with customers to make the order, Preparing the customers art/graphics for printing, Supply shipping delays, set up time, run time, clean up time, assembly time, packing time. billing, or raking in the money. Improve process.

The idea of acquiring a part time helper for seasonal load periods is a good one. There are many a stay at home moms with sales/graphic/or motor skills that would love to get out of the house for a few hours a day to make some extra money. Raising prices to pay for an additional employee should still make you a profit after payroll and the extra hours you are spending counting the money at night.

[Glen Monaghan]

My efforts to achieve a better balance have centered on improving efficiency to reduce the time I need to process my work, and making adjustments to products/services and prices to ensure that I feel the work has a good return for my time and efforts.

When my sales doubled four months in a row about a year and a half ago, I was swamped and frazzled. The next month, things slowed a bit and I found that I was then able to keep up just fine because I had been forced to work at a quicker pace, plus I'd been forced by lack of time to let go of some "extra" details that I'd been doing but didn't really need to be doing (such as the time spent doing over-the-top packaging for orders that were being shipped out... doing merely "good" packaging took about half as long as what I'd been doing).

At that time, my perfectionism made it hard to identify other places where I could be more efficient, but I realized that one particularly popular product was taking an inordinate amount of time to prepare for engraving, yet had relatively low margin, so I gambled on increasing its price. Sales of that product dropped dramatically the next month, giving me even more breathing room but worrying me due to lowered revenue. Sales levels recovered some and I'm okay with the lower sales/higher margin trade-off but wanted to boost revenue more. So, I sought out a couple of new product lines to broaden my scope. I chose products that looked like they would be popular, but take less effort to prepare for engraving, and be more profitable. Business has slowly doubled again as the new product sales have ramped up. This summer was definitely a challenge, because the increased sales came while I was moving and setting up a new shop.

Where I'd had the shop spread across multiple rooms, everything is now in one larger room which has definitely streamlined things. I've been trying to organize everything for more efficient operation. Instead of having inventory in one room, the engraver in another, packaging in a third, and administrative/office stuff in yet another room, everything is laid out together in one larger space. Generally, I've been trying to arrange everything in a loop to minimize carrying things around and wasted motion. Although I have plenty of square feet of space, the shape of the space has forced trade-offs. Still experimenting with work flow and identifying efficiency improvements. For example, I'm exploring a new layout where finished product comes out of the engraver onto a shelf to the side and the next job's stuff comes straight down from a staging shelf above the engraver - none of the stepping or spinning around required by my current layout.

Another fairly simple idea I'm setting up - I saw a packing service put their foam packing peanuts in a large cloth funnel hanging over the shipping table, and the funnel has a sort of "scissors valve" at the bottom. You put your box under it and squeeze the "scissors" handles to open the valve and dump peanuts into the box. When you release the handles, the valve closes. I wondered if peanuts wouldn't get wedged in the valve and mess things up but the operator was able to "blip" additional peanuts into the box with a quick squeeze and release, no problem. That arrangement makes more sense and should be significantly more efficient than my current arrangement of bending down, scooping foam peanuts from a bag stored under my packing table, sitting up, dumping the peanuts into the box, and repeating if needed to get enough packing material.

Look for anything you do often that involves a significant amount of time and see if you can simplify and/or automate it. You may recall me asking a while back about creating proof pictures because I was spending a lot of time on them. In the end, I decided that I couldn't/wouldn't eliminate them so I spent the time to learn enough about Corel macros to create a set of macros that dramatically reduce the time and frustration of that process. Major improvement!

So, I'm focusing on better efficiency for the work I do, and more appropriate product/services selection and pricing to try to drive a level of sales that I'm happy to process. I don't have a crystal ball to know what will work and, frankly, don't think I'm a particularly good business man, so it's just a leap of faith that things will continue to work out at least as well as, and I hope better than, they have for the last dozen years that I've been self employed.

[Dave Sheldrake]

never refuse a job outright, just quote higher than normal hoping it won't be accepted that time. If it does then it makes it worthwhile chucking in some extra hours and doing the job. Can backfire though, you still end up getting all the jobs at the higher price

guys above have covered efficiency so cant really add to that.

The increase or swamp out means you are good at your job and your prices are fair take comfort from that and pat yourself on the back (in between getting everything else done)

cheers

Dave

[Chuck Stone]

Hmm... how do I handle too much business...

Well, usually I wake up. The problem solves itself.

[Martin Boekers]

Glen hit it on the nose.... increase efficiency... I am a small shop, but I have 2 part timers... the problem is getting them up to speed and keeping them there...

The biggest inefficiency I have found, is knowledge of the software. Take time to learn more and more about the graphic programs and their shortcuts or quicker
methods, Corel and Photoshop. Things that used to take 10-15 minutes a few years back now only take a couple.... That makes a huge difference.

Spend an hour or two a week to find out how you can improve "Getting the order right on through it's delivery". I get leery about "artificially" raising prices, once
you lose a customer it's hard to get them back......

[Chuck Stone]

I agree with Martin.. Get better, get faster. Get help!

I keep seeing the common wisdom 'raise prices' but that has never
worked for me. (aside from the normal raises due to increased costs
and expenses) If I've honestly priced my work to begin with, why should
I be unhappy with 100 units at X dollars when I was happy with 10 units
at X dollars? Raising the prices means you risk alienating your current customers.

I think 'too much' business is a reward for having a combination of good
pricing, quality service and a good product. The customers chose you
based on these things.. why take one of them away?

Re-evaluate the pricing? Absolutely. But automatically raise the prices?
That seems like gouging to me, and I know I'm not alone.
I'm stubborn enough to not only never shop with such a merchant
again, and I wouldn't feel bad sharing that opinion with others.

[Chuck Stone]

Another fairly simple idea I'm setting up - I saw a packing service put their foam packing peanuts in a large cloth funnel hanging over the shipping table, and the funnel has a sort of "scissors valve" at the bottom. You put your box under it and squeeze the "scissors" handles to open the valve and dump peanuts into the box. When you release the handles, the valve closes. I wondered if peanuts wouldn't get wedged in the valve and mess things up but the operator was able to "blip" additional peanuts into the box with a quick squeeze and release, no problem. That arrangement makes more sense and should be significantly more efficient than my current arrangement of bending down, scooping foam peanuts from a bag stored under my packing table, sitting up, dumping the peanuts into the box, and repeating if needed to get enough packing material.

I've used them (wish I had a high enough ceiling to use it now!) and the scissor closure works well.
But one thing you'll want to do is place it over a well with plenty of extra room. Ours hung from
a pulley so it could be lowered to dump in the large bags of peanuts. (hint: get the anti-static!)
But it is easy to overfill a box. So .. let it overflow into the well. Our 'well' was just a lower section
of the counter.. giving us a wall on 3 sides to contain the box and peanuts. You'll use those extra
peanuts on the next box, or if you undershoot a little (but not enough for another blast from the
scissors) they're there to pick up and use. It's a neat system and buying the peanuts in 5' tall
bags saves a bundle.

[Bill Stearns]

Thanks, as always, for your helpful advice. Asking the question I did - plus your replies - has kind’ a forced me to think ‘bout my overall business plan: a start. If I can’t afford to stay small, but I don’t care to grow large - what’d I do as more organizations find me? I think Glen’s comment ‘bout being "swamped ‘n frazzled" ‘bout sums up my situation at present. I’m forced to admit that, at 66, I’m not looking for more investment. (new ‘n faster equipment, etc.) (However, I am excited as punch that this up-tick in business will help me to pay off debts.) As suggested: I did raise my prices ‘while back - am making more money ‘cause of this - but, business didn’t become more manageable - if anything it picked up! Implementing Mike’s idea of a minimum fee (i.e. $25) would free up my time; but would alienate too many people who walk-in needing minor engraving. (Their word of mouth has proven invaluable this past 8-1/2 years.) And, there is nobody in these parts to "contract out" to - only competitors. So - maybe, the best suggestion being: to work on improving my operational efficiency! Always room for that. When I say I seem to be growing, I am nowhere near needing a Styrofoam peanut dispenser - but, I'm sure others out there will latch on to the idea; a help to their businesses. So, guess for now just longer days for me - too much business? - what' a dumb thing for me to be worrying 'bout! - now, that I think 'bout it.

Thanks 'gain, guys!

[David Somers]

Bill,

Without giving away too many of the details of your business, how about taking some common task you do and posting about it here and get ideas from the crew on ways to make it more efficient? Take things in logical chunks and see if we can come up with some thoughts to help?

Dave

[Ross Moshinsky]

The answer really is to bring in help. Take in all the work you can. Bring in some help to get the orders done. If/when you lose a client, you can cut loose the part timer. Also if you continue to grow your business, you have an asset that your part timer may want to take over in 3-5 years. So instead of just selling your laser and stuff for $10,000, now maybe you can get 2-5x that because you're selling a business.

You also have to look at your pricing as everyone suggested. Make sure your business is scalable. You shouldn't bring in help if it takes money out of your pocket. You should make money off your help.