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Lesley, thanks for posting that, it makes alot of sense. One thing though, my rep is a SHE, I am surprised you were not gender neutral, hehe.[EMO]bigsmile.gif[/EMO]
Lesley,
By my experience, you should assume this. You are doing an awesome job for Lowes. they want you to do 3 more stores, then ask you to do 4 more stores, you run out of space, build new place, they ask you to do 6 more stores, you buy CNC,s, saws. ect, they ask you to do 10 more stores, you can’t keep up with them. Your overhead, employees,expenses, have increased 10 fold for this one customer, they are now your only customer, they praise you for all the fine work you do. Then they “tell you” they are giving you 5 more stores,then 4, then another 3, then say, since we are giving you all this business, we are adjusting our pricing with you. They have been watching you all this time, very closely. When it is time….. the tail wags the dog. If I had it to do all over again, I would never have one customer over 50% of my sales.
Good Luck!
Kelsey
Kelsey,
I am not sure how many stores she ended up with at the end of you post, but I totally agree. When the customer has the control, you are screwed. Just for the simple piece of mind, I would not have one customer control over 50%. They could go out of business tomorrow and then what. You will be left with lease payment you can’t pay for.
Kelsey,
I absolutely agree. In fact I started to add something about that, but then decided it was going to make my book a series. 🙂 We have a very carefully laid out plan and it involves equal development of all areas of our business. We could easily take on the other Lowes stores, but we would have to drop our “private jobs” in order to do that. Diversification is extremely important to building a successful business. Our plan is to take on only what we can handle from each area without compromising the other areas of our business. We looked at what the problem was with the company we took over for and essentially it was that they had too much work to meet their obligations. You have to be willing to grow at a measured rate or you risk over extending yourselves.
Lesley
Don’t be surprised if you hear, we are looking for a company just like yours to grow with us. If you are not interested, maybe we should look further. Keep in mind the carrot they dangled you, I mean the restructured pricing they gave you, was in their best interest. Tell them no now and see what happens ; )
Good luck!
The restructured pricing was across the board for all the stores and it was not just for LG, it covered Formica, Zodiaq, and Corian as well. In any case we have told them no already. No, we will not take any more stores until we are ready. If that means they want to pull the ones we have, so be it.
I can understand you being leary of this because clearly you had a bad experience with Lowes. I have had negative experiences with certain businesses that I will no longer do business with. That does not mean, however, someone else will not have a positive experience with them. In addition to that we are not working for Lowes directly. LG holds the contract (or whatever) and their distributors choose their fabricators. So it is in LG’s best interest to not overwhelm one fabricator because it makes their product look bad when we don’t do our jobs. (and then the salespeople won’t push it.) I know they worry about this because that is exactly what was happening when we took over and they were stressed about how it negatively impacted their sales in those particular stores. Obviously they are going to push whatever is best for them and if you no longer fit in their mold they will dump you. It is business. Businesses simply are not concerned with what their actions do to someone else’s business. It is our job to protect ourselves.
We are fairly evenly divided between Lowes, Sears, private jobs, tracts and development projects. My goal is to continue that so that all our eggs are not in one or the other basket. (although I think I would like to toss the developments altogether….the job we have currently came with the business and it has been nothing but a headache and it doesn’t pay particularly well either.)
On the other hand we don’t have a lease so it would be fairly easy to slow everything down and minimize the loss if we were to lose any of the accounts we have. Bummer for the employees who would lose their jobs though….
I do appreciate the first hand knowledge and advice and it is nice to know what to look for in case we start to run into a problem. 🙂 Thanks for the help!
Information is good, the more you know, the better choices you can make.
Doubt all before believing any, as one said.
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