Don't want to complain, but...

[Liesl Dexheimer]

I really don't want to sound like a complainer, just want to get something off my chest so to speak. Is anyone else having trouble with price quotes & having to defend pricing? It's probably because of the economy I'm assuming. I've received quite a few calls for price quotes, I give them a price & then I don't hear back from them. I do a follow up call and usually end up getting an answering machine and generally the job doesn't happen or if it does it happens about 3 months later (in fact I had quoted a photo engraving job back in October and I've just now gotten the go ahead to proceed with the order). On the plus side, I've been told by quite a few customers that our prices are more than reasonable and they are happy with our work.

I guess I'm getting tired of having to constantly defend my pricing. When you go to get a gallon of milk do you argue the price with a clerk. No, usually you accept the pricing of the times and get the gallon of milk.

I even had one of my good paying customers mildly complain about the price of some glass awards. I had to defend myself by saying that the price of those awards had jumped significantly within the past year. I even researched competitors prices and found I was anywhere between $1-10 below what they were charging (and for this particular award I'm engraving 2 logos not 1).

My concern is what is the future of the engraving industry? If the vendors keep increasing their prices, how are we engravers supposed to make a profit if our customers don't want to pay the increases? What about our livelihood? What about general costs of owning a business, like purchasing new software? We have to cover these expenses somehow.

I've also noticed vendors like JDS & Tropar may be cutting back on their inventory. A couple of times I've tried to order items that either weren't in stock or had to be backordered (in one case they weren't going to be getting the product for about 1 1/2 months!).

Is anyone else feeling the same way or seeing the same things happening?

[John Noell]

I think it has always been this way. There always are customers who somehow think that paying me enough to live on, keep my laser running, and buy more materials should not apply to them. I try to concentrate on the ones that understand I provide better service and value than anyone else they can find.

[Mark Winlund]

Is anyone else feeling the same way or seeing the same things happening?

Same here. Business is off 80% from 2 years ago. I am glad that the administration in Washington DC has informed us that the recession (depression to me) is over. Such a warm feeling.

Mark

[Mark Ross]

Until China is forced to float their currency and play "nice" it is only going to get worse...it isn't just us...

http://abcnews.go.com/Business/wireStory?id=10473764

[Gary Hair]

I try to concentrate on the ones that understand I provide better service and value than anyone else they can find.

And that is the key. You can only educate your customers so much and then you have to find different customers. My business is up about 35% over last year and last year ended up 28% over 2008. Recession my a$$, I'm not falling into that trap...

Here is a little story you all might have seen, but please take it to heart.

The hot dog vendor
It's an old story, so perhaps you've heard it before. However it's message is a powerful one, so I'd like to repeat it here for you. Even if you've heard it before, you might like to pass it along to someone who hasn't. Maybe even your clients!
It seems that there was this elderly man who had a profitable little business selling hot dogs on a busy street corner in a major city. He wasn't particularly well educated, but he sold great hot dogs, his customers loved him and he was innovative in the way that he promoted his hot dogs.
During the early morning rush hour, he'd wheel his mobile hot dog stand to position it near the exit of the central railway station in town, which was near a bus station as well. A year ago he'd added a bacon and egg roll to his range and sold scores of them to this breakfast crowd every day. At lunch time, he'd move his stand to a popular park where he had regulars who stood in line waiting their turn.
In the afternoon he'd be back at the station entrance and then later most nights he knew a great spot near a night club where he was rushed off his feet by young people grabbing a hot dog as they came and went from this popular night spot. He had even installed special lighting and a flashing neon sign. Even people driving by would stop.
He'd worked hard for years and done well enough to put his only son through university and his son had become an accountant with a large accounting firm.
One day his son warned him that a recession was on the way.
The old man asked his son what this meant. Being an educated man his son gave a very detailed explanation of how the recession would severely impact everyone in the community, particularly small business people like his father. There would be enormous unemployment, people would not be able to afford to spend money as they did now. He painted a gloomy picture of the future and warned his father that it would be wise to cut back on his expenses and "tighten his belt" financially and prepare for the worst. The old man didn't know much about the economy, interest rates, or the fall of the dollar, but he trusted his son. After all, he was an educated man.
Recession mentality kicks in.
The old man began to cut back on the quantity of sausages and bread rolls he bought daily. He didn't want to get caught with stale rolls as business began to drop off. But it was hard to judge and some days he actually ran out of sausages and rolls earlier than he normally would. So he went home early and spent more time worrying about this recession that was coming.
Soon he knew that what his son had said was right. He noticed that his takings were indeed falling. This depressed him more and so he tended to get out of bed later each day. After all, why get to the station so early when obviously more people would be eating at home rather than spending money on breakfast in the city. He decided that his bacon and egg rolls were too expensive for most people now. After all, they were twice the price of a hot dog, so he cut them from his menu and his sales continued to plummet.
Wow, his son was right, this recession was hitting hard!
He decided to save more money and not replace the batteries that powered his neon sign and lights at night. Now because he was in the dark, fewer people bought from him and soon he decided that it wasn't even worth his time setting up at night time.
Eventually he decided to sell off his equipment and his trolley. He was in luck though, because the young woman who bought his trolley didn't seem to know how bad business was, or how severe the recession was going to be. He managed to unload the trolley for more than he thought he would get. Now day after day he stayed at home, depressed and occasionally his educated son would visit him and they would discuss how bad the recession was, and how lucky the old man had been to have an educated son who had warned him in advance about this terrible recession.
So what's the moral of story?

Recession mentality starts in one's own head

If you believe that a recession is coming and that times will soon be tough, then they will be for you. Like the old man in the story, you'll start to change your successful behaviour patterns and replace them with less resourceful habits. You'll sleep in later. You'll take longer lunch breaks, make less phone calls and go home earlier. Because our "outer world" is always a reflection of our "inner world" soon we will begin to create a recession in our own world.
During a downturn it's time to work smarter, harder and sell and promote even more intensively - not cut back

It's not a time to stop doing those things that used to work for us. During the last downturn, I watched as some salespeople and businesses slowly went broke. It was sad to watch. Instead of being pro-active in their activities, they became depressed and resigned to failure (which soon manifested). Please don't get me wrong, some business people did it tough - but some actually thrived.
A recession or downturn can actually create many wonderful opportunities

It's all in the way you look at what is happening. In tough times some customers are still buying. They perhaps don't buy as much, so the market size stops growing or maybe even shrinks, however there is still some business there. It's time now to grab a bigger market share and it's easier now if your competitors are suffering from recession mentality. They are now probably not being as aggressive in the market place, their service may be falling off, maybe they are not a reliable supplier any more. It's now a time for promoting harder and selling smarter.
If what you are doing is not working - change what you are doing!

In tough times, sometimes we need to take a hard look at what we are doing and make improvements. It is insanity believing that we can stand still and not change while the rest of the world and our marketplace is changing.

[David Takes]

Liesl,

Why do you feel you have to defend your quote? Give the prospecive customer your best price based on your overhead, salary requirements, perceived value premium, then leave it at that. If you're not getting work you need to look beyond your pricing.

Is your target market too price sensitive? Is your service and/or product selection broad enough? Do you make it easy for customers to do business with you. Do you inventory product and materials so that you can maximize your turnaround time? Do you offer regular business hours at a location where customers can easily find you at their convenience, not yours?

[Rodne Gold]

If your customers are questioning your pricing they obviously percieve a lack of value , if this is becoming more prevalent , then you need to investigate it.
Pricing needs to be in line with the competition and competitive processes. The milk analogy is not quite the same as lasering , one needs the milk , one doesnt neccesarily need the laser engraving.

[Liesl Dexheimer]

Interesting points everyone has made. Thanks for sharing with me. I've tried different avenues including marketing but I'm noticing businesses have definitely cut back, especially during this first quarter. Usually the first quarter is always quiet, I just expected things to start turning around this month. They slowly are...but it doesn't seem like in years past. Last year it was as if the recession hadn't even hit us, this year seems to be an entirely different story so far. Only time will tell I suppose...

[Rodne Gold]

The problem is that businesses and ppl that have made it "through the reccession" have very little disposable income after hanging on by the skin of their teeth .. You need to market to "needs" based ppl rather than impulse and novelty purchasers ..concentrate on industrial and fabrication work and consider hiring a REP who works on a commision basis - possibly someone in the signage supply industry who wants to carry an extra line.

[Viktor Voroncov]

Liesl, you are not alone :( I am in engraving business since 1992 but yesterday first time in my life I thought about changing my area of application. We did few excellent products and present them to customers. Products are perfect, and three years ago I can sell a lot of them but now I am listening only good words about products with no purchase. My customers simply do not have money. Over 40% of my clients in traditional sales region became bancrupts, all other delay payments :( Turnover decrease was 50% in 2009. Bank's cut all financing for me and my customers, government raise taxes :(
But my daughter finish school this year, have offer from good University :) Who will pay education bills? So it means I will work much more - no choice. Last two years I am working 6 days per week, was only 2 weeks on vacations, hope will be able work same way at least four years more until daughter will graduate University.
Unfortunately, this is current life :( whole our society is based on small and medium business but we are always "scapegoats" in difficult times.

[Scott Shepherd]

Rodney said something very important and I hope everyone picked up on it. Engraving personalized items in a "want" not a "need". You need to figure out how to get your services into people that "need" your work, not "want" your work, and that's not trophy's or awards.

[Mark Winlund]

The hot dog vendor
It's an old story, so perhaps you've heard it before....


The idea that the depression is "all in your head" is silly. Just walk around town and count the empty buildings. Look at the classifieds... the forclosure notices are a sea of grey. The depression is real. No amount of "feel good" conversation is going to cure the problems. Factories (where things are actually made) are leaving for foreign shores, never to return. The idea that we can all sell hot dogs to each other and become a prosperous nation is unlikely, to put it mildly.

The problems are systemic, and our leaders haven't a clue what to do.

Mark

[Gary Hair]

The idea that the depression is "all in your head" is silly.

To think that the story was to be taken literally is "silly". The point is that the hot dog vendor created his own problem and it led to the demise of his business.

If you take away from the story that we are the cause of our own problems then the story was successful.

Take from it what you choose Mark.

One of my favorite quotes is from JFK:

"Our problems are man-made, therefore they may be solved by man. And man can be as big as he wants. No problem of human destiny is beyond human beings." John F. Kennedy - June 10, 1963


Gary

[Liesl Dexheimer]

I agree that engraving is a "want" not a "need" and it's hard to find customers that "need" engraving. Even our local sign shop has cut back on the number of orders they are giving us, so the recession has been effecting them too.

Here's my theory and I've heard this quote before:

"I'm not negative, I'm realistic."

That's how I feel. You can try to change certain things but sometimes it's beyond your control, no matter how much you try.

[Ron Chapellaz]

Factories (where things are actually made) are leaving for foreign shores, never to return. The idea that we can all sell hot dogs to each other and become a prosperous nation is unlikely, to put it mildly.

The problems are systemic, and our leaders haven't a clue what to do.

Mark

You nailed it on the head Mark! I read an article that said that the U.S. and Canada are 10 years behind in technology in order to have factories that can run as efficiently as the Chinese. It seems it's a cycle that can't be broken unless we are all willing to pay more for goods which in turn will keep our own countries productive. I myself hate the fact that nothing is made here in Canada anymore.

I also read on another thread here that wholesalers are not keeping their stock levels as high as before. I agree with that statement. Part of the problem is that they run out of supplies before the next boat load comes in from China or wherever. I waited over 3 weeks for an order from a wholesaler that in the end never made it to me for my deadline. The products were made in Malaysia, shipped to Florida to the company headquarters, then shipped to my wholesaler here in Canada, and then finally on to me. Pretty sad when an item that can and used to be made locally is shipped from half way around the world!

Here's another example. We here in Canada are known for our beef, same as our neighbours to the South. There have been times when the food wholesale chains are importing beef all the way from New Zealand because it is cheaper!

The only way that I see things changing is if "WE" want things to change. Looking for items made in "Canada" or "U.S.A." and letting our customers know that they are helping with our own economy.

That's my Canadian 2 cents worth!

[Scott Shepherd]

Sorry, I agree with Gary.

So the factories all shut down around you. Now what? Sit and wait for the phone to ring? Wait by the door for the golden goose to walk in? This is business. YOU have to make it work. No business in your area? What's your website look like? Do you sell products over the internet? How do you broaden your market outside of your area? That's your JOB to figure it out. No work around you, do some research and find out where the work is and go after it. People order things from all over the world. Demand for everything has not stopped. It's out there, you have to find it. With no web presence, no decent rankings in search engines, no marketing, just what do you expect to happen? Thinking you can sit in one place and not try to expand outside of a economically depressed city/town/state isn't going to get you far.

If you can't figure all that out and execute it, then you'll probably be one of the hot dog salesmen that throws in the town and goes home.

How many of you that are slow are advertising in the "Friends of the Creek"? None? If people don't know who you are of what you can do, outside of your little town, how do you think they'll give you business?

I'm with Gary.

[Viktor Voroncov]

Ron, here is stickers we have placed on all our products :) Unfortunately they brought me and my peoples only moral satisfaction. Most of customers buy cheaper products.
But problem is more wider. We must be more active in politics, elections and affect economic decisions made by our governments. Situation with bank's management bonuses is offensive (abusive) for most SMC peoples.

[Jim Coffee]

Some people call the past event a recession. I prefer to think of the past event as 'life', or as a 'correction'. Personally I don't want things to return as they were. I think a 'correction' was due.

My business continues to grow. In the past twelve months I have more active customers (placing marginally smaller orders) than in the 12 months preceding.

If we are employees we hope that management can plot a safe course into the future. If we are business owners (as I believe most of us are) then it is our role to plot a safe course into the future. As business owners we should never assume that tomorrow is going to be the same as yesterday. Change is inevitable. We need to expect change. We can always hope that change is in our favor...but we cannot expect that it will be in our favor.

Have you read any of Thomas L. Friedman's books. I highly recommend his books. He is a Globalist. He gives strong hints about where we are headed.

In my case I have paid attention to several key things as I have moved my business into the future:
~Marketing (very important and essential).
~An Internet presence.
~My products are very focused.
~My products are more 'essential' than 'non-essential'.
~My client base is diversified in terms of business and geography.
~I try to understand and respect my clients.
~I try to understand and respect potential clients.
~We really enjoy what we do. If we did not love what we do it would be too difficult.

My bottom line here...Do what you love. Work hard and smart. Expect change. Understand that the world is 'flattening' very quickly.

[Belinda Barfield]

Liesl,

This is somewhat related to your original point, and I understand your frustration. I'll try to keep this short.

Yesterday I received a call from a lady who wanted to buy granite "remnants" for kitchen countertops. She asked for a specific color and I explained to her that I didn't have anything in that particular color. She then responded that she was looking for "only" 20 square feet of countertop . . . that isn't a remant. I tried to be helpful, and polite, but she then launched into a long rant about how she couldn't find anyone to sell her granite for a reasonable price. Reasonable? Define reasonable. At that point I explained to her that we no longer fabricate countertops for the residential setting and work primarily with the yachting and aviation industry. Her response? "Oh, well if you do business with company Blank then you can afford to give me remnants." I politely suggested she call someone else.

In this economy I realize that we can't always afford to alienate customers. However, if you are spending more time defending your price than you spend producing your product, maybe it's time to rethink your client base. Just my 0.02 and not worth much.

[Mike Null]

Just a reminder to all. We have very hard rules about the topics of politics and religion on the Creek.

We are bordering on making this a political discussion in which case it will be removed.

[Doug Carpenter]

Welcome to self employment. You have to kick and scratch for every penny.

I have often wondered how people would like negotiating for their paycheck every friday.:rolleyes:

One thing I have learned in 2o years of owning my own business. There is a fine line between self employed and unemployed.

Hang in there. I know it gets tiring fighting over price. Once in a while I just tell someone to take thier business somewhere else. It makes me feel better and sometimes you even get to hear that they learned their lesson.:)

[Lee DeRaud]

Just a reminder to all. We have very hard rules about the topics of politics and religion on the Creek.There is a significant percentage of humanity for whom religion and economics are more or less the same thing, and an even larger percentage for whom politics and economics are more or less the same thing.

Given that, I've always wondered why discussions of economics are allowed here. :cool::p:eek:

[Doug Carpenter]

Just a reminder to all. We have very hard rules about the topics of politics and religion on the Creek.

We are bordering on making this a political discussion in which case it will be removed.

I don't understand why what is being discussed here is too much economics.

Certainly as business owners the ecomomy plays a roll in our daily lives. What is so offensive about calling it like we see it?

[Kim Vellore]

from an another point of view from a regular full time employee

Basic everyday prices have gone up, electricity, gas, water, garbage even postage. Pay has gone down either by pay cuts, furlough, and no raise.
I have got 2 traffic tickets in the past 2 months and none in 10 years. The law I broke 36mph in 30 mph zone in a downhill, and did not stop full 2 seconds before making a right turn on red. The second ticket cost $494 or $533 if I go to a class. The cops are being innovative in ticketing to fill their budget gap, you got to love them.
Now if I have to pay a little more for customizing a gift for a friend using a laser I'll find innovative ways to save that $$. At my work we used to get plaques for awards, now just a mention and a pat on the back.
I could go on and on, this is just the tip. I think I will call this a recession, it is not just in my mind.

Kim

[Rodne Gold]

My take is that things are going to get harder for the remainder of this year , as I have said before , those that managed to weather the last year or 2 are barely hanging on and do not have disposable income to "waste".
In terms of this business , it is rare to see someone with ONLY a laser who is jobbing , making decent money. I offer multiple services and use multiple machines to make items and this seems the way to go , however there is a highish capital cost involved as well as a learning curve.

[David Fairfield]

If we want free trade and an abundance of cheaply made imported material goods, the American middle-class quality of life has to equalize with the "middle classes" in China and India... which, IMO, means most Americans are going to have a lower quality of life. Whatever... if math is too hard for Americans to learn, then Indians will learn, and they will get paid to do math... Americans are forced to compete with pennies-an-hour labor, and wonder why life is starting to suck. Sorry to be a pessimist. I hope I am wrong.

Dave

[Jim Beachler]

I agree with some of the above posts. I strongly believe that the MOST important part of my job is Marketing / Sales. If I don't do them, then no matter how could I am with a laser, I won't have anything to do.

I spend more time doing marketing and sales than any other job in my shop.


Last year we shipped 33% more product than the previous year. and we are up so far this year. I am in a very nichey product line, personalized wooden items for children and babies. It is not a product that is a have to have but rather a want to have. I have been able to do this by not settling with the current vendors and products that I had. I am continually seeking new customers by trade shows, web site, wholesale web site, drop ship companies, craft shows, art shows, cold calls and even wearing a jacket with company name and web site on it. I am also continually creating new products for my customers to buy.

At a marketing class (yes I still take classes to keep fresh), I learned a great line. Marketing is like pushing a car up a grade. If you stop pushing, it will roll back over you and you have to start from the bottom all over again. Moral - Never Stop Marketing.

[Martin Boekers]

Rodne is right on with his thoughts. The survivors are the ones who adapt.

This year will be the best year I have had at the shop I manage. (A Very Good Year!!) Did it come at a cost ? Yes!

I have always worked hard and many hours throughout my career, but this is the hardest and most inovativley challenged I have ever worked.

The days of getting a week or so to finish small projects are out the window.

Typically I finish jobs now in less than 48 hrs. many the same day and a few while they wait. This keeps me ahead of the local competition. (look how the photo industry changed in the last 20 years. It used to take weeks or months to get snapshots done. Now it's less than an hour). Some day this may happen with our industry also, look at the pet shops that are installing Epilog lasers for a customer serviced nametag. I can see this happening a Walmart down the road. Someday they may have a selection of awards and gifts that you buy, go up to a kiosk or even email it in, the plate gets engraved then you pop it on a plaque. Scary isn't it!:eek:

I have found vendors that provide larger discounts and have a warehouse within a days shipping. I run a tight ship with inventory control, to make sure I have products available that my clients buy, yes it does cost a bit to have extra stock. On the other hand though, I buy larger quantities so I save with discounts and have less shipping costs.

I have developed systems and heavily rely on email for job initiations to increase productivity and efficiency.

Email orders are great for clients as it saves them an extra trip which in turn saves them $$$.

Diverisify, diversify, diversify! I started doing signage products about 2 years ago, now that is about 15% of the business. I plan to get a CNC machine next quarter so I anticipate more signage work down the pike.

ASI, How many of us sell ad specialty products? Not many I think, why not? It doesn't cost much to join and have access to software and 10s of thousand of distributors.

Recently there was a post about what to charge to engrave glasses, on quantities it's hard to compete with ASI so why not bid the job to an ASI dist and get paid for doing the paperwork?

The laser may bring in a client to your shop, but find out what other things they actively purchase and see if you can provide them with it.

There are ways to give you the best chance of growing the business or even surviving for that matter. It does take work, much work and a bit of thinking outside of the box.

Marty

[Mike Null]

Just to add emphasis to Steve Sheperd's comment about Friends of the Creek you can read about it here.

http://sawmillcreek.org/showthread.php?t=137709

[Dave Johnson29]

See my little rant here...

http://www.sawmillcreek.org/showpost.php?p=1410740&postcount=8

[Jim Beachler]

Dave, You are so right. Doing what the customer wants is the easiest way to keep that customer. If it costs a little more to do it their way, charge them for it. If they want it that way, they will pay for it.

I had a customer that wanted a stand up puzzle personalized that was 24 inches tall. she had been to several other people before me that said they couldn't do it that way by the time she got to me she, her mind was changed into a tray puzzle. Seeing the plan, I told I thought it would be neat to have a stand up puzzle. when she found out that I could do what she wanted in the beginning, she couldn't have gave me the money any quicker. I have since done several other items for her.

Giving the customer what they want = more sales and referrals.

[Mitchell Andrus]

And that is the key. You can only educate your customers so much and then you have to find different customers. My business is up about 35% over last year and last year ended up 28% over 2008. Recession my a$$, I'm not falling into that trap...

Here is a little story you all might have seen, but please take it to heart.

The hot dog vendor....



I'm with Gary here.... and I have known the hot dog parable since H.S. Business is up (I sell nationally). Malls in NJ and Western NC are full. Contractors are hiring.

Sooner or later tires wear out, roofs leak, roads get potholes, socks get holes in them and everyone needs to eat.

We're Americans and we don't stand still for long.
.

[Mark Winlund]

At the risk of being cut off by the moderators, I will say that economics as applied to our engraving businesses is certainly an on-topic, relevant discussion.

There are two groups here... those who are pessimistic, and those who are optimistic. (we used to call it whistling past the graveyard). I am am among the pessimists. No amount of cheery optimism will change the fact that for many small engravers, business is down by a large percentage. Anyone who has been in the engraving business for more than a few years already knows the ropes enough to seek out additional business from new sources. Many of the failures are among those that bought a laser expecting it to be the main income producer for a home business. As Rodne has pointed out, a laser is only one tool among many that are needed for success.

As you can tell from my signature, I have a large inventory of equipment, all of which is used on a regular basis for engraving jobs. I am probably better equipped than most, but that doesn't change the fact that revenues are down by more than 50% in the last 2 years. In our town, empty buildings are everywhere... buildings that used to have our customers in them.

I would say that dicussions about economics (as applied to the engraving field) are very relevant. I would also venture to say that discussions about the causes of our economic problems are also very relevant, but I would be chopped of in mid post if I brought up the subject.

Mark

[Mike Null]

Mark

I tend to agree. We have three auto plants here in St. Louis that have closed in the past three years. With that came the closings of the businesses that supported them with various parts and services as well as the businesses who served those employed by all of those former businesses.

The housing market is soft and that brings more economic problems.

To deny the recession is simply not facing reality.

On the other hand I had my best year ever last year and I'm running ahead again this year. Like Gary and others I'm pursuing more oportunitities and while I'm fairly well equipped I'm looking to add another piece of equipment to broaden my services.

As far as the politics thing is concerned we all have a point of view and sometimes very strong views that quickly get aggressive and that is why we monitor such posts.

[Larry Bratton]

Never fear folks..The government says it's over. Right