The end result is that a dealer needs to score a total of 500-750 possible points to be at the very top of this Ladder of Business Success – and thereby be assured of selling his or her business at a premium price.
DO A SELF-AUDIT
By way of example, dealers might earn three points on the Ladder of Business Success for receiving an annual benchmarking report that compares their company’s financial performance to a select group of similar-sized kitchen/bath design firm owners. They might earn eight points for interactively developing a three-column budget analysis with consumers, using this practical educational approach as a means to being retained on projects. And they earn another 10 points for achieving a liquid emergency fund equal to 12 months of fixed expenses – to be used for financing future growth or funding survival during the next recession.
Owners who have read this column over the years should have little difficulty in identifying scores of “rungs to climb.”
As kitchen/bath dealers develop their business operations, they are also simultaneously improving service to their customers. For example, installing an automated management system adds an extra measure of staff productivity by enabling them to spend more time consulting with clients than the competition. As a result, progressive dealers should market their companies as having superior customer service.
Dealers who serve as general managers in their operations – and have the time to work on their businesses – probably would love this means of self-measurement. Those who mostly work in their businesses might be distraught by an average total score of only 100 points out of a possible 500 or more. For them, a Ladder of Business Success could serve a useful purpose in having them realize how much further their companies need to be developed.
How successful is your kitchen/bath firm? Are you up for discovering how many points your business would legitimately earn climbing a Ladder of Business Success? Interested parties may contact me directly at firstname.lastname@example.org for a digital file of such a prototypical self-audit. And, if you forward me a completed self-audit, I would be happy to offer an Action Plan of Priorities for your company to pursue over the next several years as a way for me to give back to the kitchen/bath industry.
Ken Peterson, CKD, LPBC, is president of the Chapel Hill, NC-based SEN Design Group, the industry’s first buying and business development group for independent kitchen and bath design firm owners dating back to 1994. Peterson can be reached at 1-800-991-1711 or email@example.com.