In his hometown, Ian has always been an expert carpenter. It was tough to find a more knowledgeable woodworker. What gave Ian a competitive edge was his passion for creating something beautiful out of wood, consequentially he was constantly trying to develop new products. Ian started his manufacturing company over 15 years ago to make his passion a reality, not a hobby. His new business allowed him to try new techniques and processes he never could have in his garage. For the first 10 years, he created new and innovative products, identified and hired rising stars, and found a customer niche that allowed his revenue to grow. In short, he was living his passion.
Creating the company was a lot of work for Ian but it was rewarding. However, after about 10 years the company started to hit a slump. Somehow, the revenue growth stalled. His approach and passion hadn’t changed, yet his business wasn’t as effective as it had been in the past. As his company grew, he hired good managers and employees, but some of his rising stars had moved on to other jobs and some to competing companies. As replacement and new employees came onboard, Ian had a growing feeling that these new employees didn’t share the same vision and passion as he did.
To make matters worse, profit margins were shrinking and he felt that he was losing customers and yet couldn’t understand why—his products offered the same quality they had from the beginning, and he was able to keep costs competitive through new techniques that reduced production costs. Yet, Ian was increasingly uneasy … was his dream and all of the hard work coming to naught?
He spent his days looking for new markets for his products and researching competitively priced parts—which was not his strength, but he didn’t want to hire anyone in to do this for him. Ian was too worried about shrinking profits and started to focus on working harder to fix where he had gone wrong, though he wasn’t really sure his remedies could to fix it.
He began to feel trapped, he no longer had the time to take vacations and generally didn’t look forward to going to work—he feared he might lose everything he had worked for in his life. He often was unable to sleep and lay awake, night after night, puzzling through what wasn’t working.
After internally fretting over his business, Ian eventually took action. He knew he was losing competitiveness and started to believe his market niche had changed, and that he needed to change to compete. So, he started to offer his wood products at lower prices and began competing in lower price markets. This new market niche required higher production outputs with a lower quality products. He worked hard to find customers and work – anything to keep his doors open – essentially, he started to chase revenue.
Unfortunately for Ian’s company, his production techniques and skilled workers weren’t established for low cost, high production outputs. His remaining original employees and his older managers were starting to get disillusioned. Sales continued to remain flat but profits were now seriously dropping. Things were getting worse. In an effort to get some help, Ian reached out to us.
In his concern, Ian turned a great business model upside down. That is, he lost sight of his customer’s desires and needs. The priority of any business is to wow your customers, to be so good at delivering your products and services that they would never think about going anywhere else. Meet their needs and expectations and financial success will follow.
Ian needed to go back to his roots, to his original passions. He needed to understand his values, what was important to him. He needed to communicate his purpose, his value delivery proposition and a strong reason for his customers to believe in his products and services – and these needed to align to his customer’s desires.
Ian’s original products weren’t outdated, but the company’s image was. It was becoming clear that one of the main reasons for his company’s revenue slump was a failure to adapt to the new ways of connecting with customers. He had lost sight of their needs. Word of mouth wasn’t going to solve this problem. One of his longer-term goals was to introduce new products, but new products alone would not have turned the tide for him—his company lacked character and vision, in the eyes of his customers, and that’s what we helped him focus his efforts on in the first 100 days.
So, Ian acted. The first step was to get his management team and employee onboard with the changes. He listened, it was hard at first but then he explained why he wanted the changes. He explained he wanted to stand out for something that was good. They were in synch.
Then he had to get buy-in from his customers. First, he listened. He revamped his products around the priorities of his customer base. He coordinated a social media campaign that targeted a network for his quality products (with reasonable prices) that resonated with his specific customer base. His plan was to make a believer of his customers as well as his employees.
Once his new marketing campaign was established and had connected customers Ian was able to show customers and employees why he was in business. As he moved to the next stage and started introducing new products that really demonstrated his values of honest quality and dependability his revenue started trending upward and the situation for Ian began to ease. His focus was on them – not on revenue – and as they embraced his commitment his financial position improved.
His fear began to fade, and he started to truly enjoy the steady growth he was witnessing. His employees started to see a change for them as well. They were no longer spending time researching cheaper parts or new places to sell his products—his customers were coming to him effortlessly, because they liked his values. They wanted to know as part of that quality.
Never lose sight of your customers. They are the life blood of your business. When you focus on them – their needs and desires – and deliver, financial results will follow. Ian has since started thinking about developing a “next gen” product line unlike anything he’d done before—which was what he truly loved to do and was the reason he went into business in the first place.