How Long Until The Next Price Increase?

I don't want to jinx anything, but have you noticed that the price increase letter sent from our manufacturers and suppliers seems to have dried up?

There was a period last year where it seemed that nearly every week most of us were receiving letters explaining rather large increases from immediate effect or within 7 days. Glass price increases were the largest, with Pilkington raising some of their product ranges by about 40%.

However, for the last few months of 2011, and the beginning of 2012, I haven't heard of any upcoming price increases, from any area of the market - much to my surprise.

The cost of raw materials has continued it's steady rise, oil prices are back on the up, fuel costs are still painfully high and general running costs for businesses continue to rise. I fully expected more price increase letters before this point.

This pause in price increases is of course very welcome. Profit margins for every company are being stretched badly right now, any further increases will only add further strain. However I do feel that at some point this year, most likely to be late spring/early summer, there could be a raft of increases again. Companies right now will be looking at their accounts, their margins, forecasting further raw material price increases, and seeing whether or not they need to raise their prices. By the time these processes have been done, we're likely to be in April or May time. Of course I may be wrong!

If I am wrong, this will be good news. No one wants any more price increases, and the longer they take to arrive, the better for customers and just as important, profit margins.

First Day Back

It was the first official day back in the office today, and it was a surprisingly brisk start to the new business year!

We had been open at various points during Christmas and New Year, and took some decent quality leads and some sales too. Not bad to say we're approaching another recession and it was during our quietest time of the year.

Lead levels today for the first day back were pretty good, we all signed up deals and there's plenty more decent sized orders in the pipeline to come good.

But, I think this little boost to the start of the year may be a symptom of a reserved December. People were quite unwilling to spend during most of the month, most likely holding off until Christmas had passed to start their home improvements.

The positive start to the year is of course welcomed, however it probably won't be a sustained improvement on 2011. I think that just like last year, business in 2012 will come in fits and starts. The key will be to sell this years contracts with a decent profit margin. People are getting used to things becoming more expensive. Companies should start to use this change in attitude to re-build their profit margins over the course of the year.

False Growth

Growth. The word has been used so much over the past couple of years that it is starting to wear a bit thin now. Quite frankly, I only want to hear about growth if it has been genuinely achieved.


Over the last few weeks, the industry magazines have been littered with reports of growth from various companies and organisations. This is where I'm going to split growth into two types. The first, growth through expansion of branches or franchises. The second, growth through increased revenues and profits.


To me, there is only one type of growth that matters and that is growth through increased sales and revenues. If jobs are priced right in the first place, this leads to increased profits - exactly what matters in times like these.


There have been various tweets and reports from a UK wide double glazing company, stating record weeks/months in terms of sales and frames produced. At first it sounds impressive, but when you consider the extra dealers that have been signed up over the last few weeks and months, this was always going to be the natural outcome - hence false growth.


Growth to me is always more credible when a single company or small group of branches manages to grow. Not by expanding the business. You can expand as big as you want but still not make the correct level of profit to make it work. But by increasing sales from the existing business. That sort of growth is a showcase of that business's ability to make the most from what it has got, rather than having to expand in order to post better figures which are a little bit misleading.


Would be interesting to hear all your thoughts on this one!

It's Time To Wake Up Sales People!

Why is it that when companies are being told time and time again that making a decent profit margin is an absolute priority, am I still surrounded by fools who still think it's a good idea to sweep their quotes so much they're doing the work for nothing? All to make sure they win the order? Whats the point!!


We have one of two reasons to choose from here folks. The first choice is that the people in charge of these companies have no basic understanding of mathematics and have no business skills. They don't understand that in a time of economic hardship, the work they bring in must have some profit attached to it so that they can stay afloat to hopefully make more money and honour the guarantees they give out.


The second choice we have is that they are unable to sell the benefits of their product over their competitors'. They feel that the only way to secure a deal is to make it cheaper than everyone else's, even if it means making very little or nothing at all. But they think it's OK because even though they're doing it for nothing, no else has got the work.


Which ever reason you pick, both are ridiculous. Duncan Bannatyne was on Sky News Wednesday morning and the news reader asked him what was one of the biggest mistakes people make in business. He said that one of the biggest failures of people in business was people blaming everything but themselves for their shortcomings. And this applies here. I don't believe that you can't make a decent profit during times like these. If you sell your benefits well, believe in your product, know your product inside and out, and provide exemplary service from the beginning, there's no reason for your quotes to have little or no profit. These hairy fairy excuses of 'there's too much competition' and 'times are tough' don't wash with me. We managed to increase our profit margin all the way from the recession in 2008 to now - through professional salesmanship good business sense.


And you don't have to give in you know, when a customer asks for a discount, more times than not they're prepared to accept the quote you gave them in the first place, they're just trying their luck.


You may ask why I'm so bothered about this. It bothers me because the reason why people are in business is to make money. Why else would businesses exist? Yet during these last few years we've seen many people lose their heads, become irrational and have forgotten how to run a business effectively and profitably. This to me is completely unacceptable when there are people's jobs and livelihoods at stake. Owning/running a business means you have a lot of responsibility, if you can't hack it, leave and don't run the company into the ground!