Crouser & Associates Performance Group program helps printers prosper through
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Thomas P. Crouser. Material may not be reproduced in whole or in part without written
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Letters:
Joe Butler Responses And Other Items From Alaska to Iceland
Crouser Report OnLine April 5, 1996
Transmitted from Bay City, Michigan
Okay, we give in. By popular demand, our only new Performance Group this year
will open in Orlando, Florida instead of Chicago this fall. Our groups are a
combination of on-site visitations and meetings which focus on creating a
high level of performance. For more information, see the end of this message.
First, thanks for all of your positive comments on our story on Mr. Joe
Butler of New Orleans, Louisiana. Let s me share some of these with you
before we get down to today s hard work. First, Dave Fellman.
From: DFallT
To: TomCrouser
Tom... Great Story!
I think there is something about cab drivers and basic wisdom. Either that,
or both of us have been very lucky to ride with a couple of the best examples
of that particular industry. I ride to the airport regularly with a man named
Sam Ewing, who I estimate is somewhere between 70 and 200 years old. He has
given me a special view of the history of our town. He has shared a great
deal of his thinking on parenting. He has given me another perspective on
service by telling me about what he likes and doesn t like when he goes into
a store. I ve often thought that the people I speak to in articles and
seminars might be just as well off listening to Sam.
So you gave us all the opportunity to listen to the wisdom of Mr. Joe Butler
of New Orleans, LA. Nicely done, and thank you.
Dave Fellman
Subj: Re: Mr. Joe Butler of New Orleans, Louisiana
From: BeckyWh1
To: TomCrouser
Wow! Great article! It really makes you stop and think, doesn t it? Which way
are we perceived by our customers? I want to be a
Joe Butler
!
See ya! Becky Whatley
Subj: Re: Mr. Joe Butler of New Orleans, Louisiana
From: RiobiJim
To: TomCrouser
Tom, excellent seminar with Mr. Joe butler!, Thank you for sharing it. . . .
. .Riobi Jim
Subj: Re: Mr. Joe Butler of New Orleans, Louisiana
From: Hotline Cy
To: TomCrouser
Tom: I have read and re-read this piece and the more I read it the more I
like it. Joe Butler is something that can be threaded into almost anything.
It s a wonderful story and thanks for sharing it. Since we do go to New
Orleans occasionally I would like to know how to get in touch with Joe. cy
Subj: Re: Mr. Joe Butler of New Orleans, Louisiana
From: Michae0912
To: TomCrouser
TOM: ABSOLUTELY, POSITIVELY LOVED YOUR E-MAIL (OR WHATEVER ITS CALLED
ON-LINE). I know you say don t, but I downloaded a copy of your
Mr. Joe
Butler
and took home for my wife to read. What memories. A year ago April,
we were in Atlanta, GA for a nursing congress and met on the first day, a cab
driver named David. He must be your Joe Butler s brother; this guy had the
cleanest car, the best manners, the most sincere interest in OUR happiness
and security - we paged him or called his cellular phone every day for a week
- he was the only cab driver we used in Atlanta. When we left (2 of our 3
kids were with us and they absolutely fell in love with him) it was a tearful
separation. I ve never been so impressed in my life.
Your
thoughts
brought back great memories - and thanks, especially for
the way you tied it into printing. WOW.....Thanks,
MIKE.... Printing Center, Bartlesville, OK
From: ATedeschi
To: TomCrouser
Dear Tom: Your story on Mr. Butler rang loud and clear. I gave a copy of it
to our staff and read it out loud ( I wanted to make a skit out of it). We
analyzed it line by line and spent 45 minutes discussing Mr. Butler. Thank
you for sharing that with us.
Sincerely, Tony Tedeschi
Subj: Re: Mr. Joe Butler of New Orleans, Louisiana
From: BFARQ
To: TomCrouser
Tom-Loved the N Awlins cabbie story. Tell me - how much did you tip him?
Bill Farquharson, Print Tec Network
Actually, Bill, I paid him $40 for a $21 ride to the airport. Okay, well
anyway, back to work, troops! We were discussing overtime pay and what had to
be done. I had noted that working a person overtime and then making them go
home when they hit 40 hours was a little bit like,
Thanks for your hard
work, but no thanks.
Andy sends us his recent experience.
From: Dependable
To: TomCrouser
Regarding the letter questioning overtime, I had a similar experience this
week. Let me tell you how I handled it. I had a critically rush job that HAD
to be delivered by 9 AM the next morning. I had two employees who offered to
stay until the job was finished. This ultimately required staying until 3 AM.
They asked to take the following day off to rest. Their total hours for the
week would have been 42 hours, resulting in only 2 hours at overtime. Instead
I chose to pay them the equivalent of a day off at overtime (6 extra hours).
These employees made a sacrifice that showed a loyalty beyond money. It was
the fairest option I could have given under the circumstances.
Andy LeWinter, Dependable Lithographers
And Sharon writes from Alaska (Hey, Sharon - spring s not too far off!)
Subj: Enjoyed!
From: Doodledive
To: TomCrouser
Tom, Wanted to let you know that I enjoyed your recent newsletter (2/29).
The budget info for Sue, was particularly helpful, because it helped to
reinforce the % s that I ve been working toward for the past four years (two
years printing). I m sure it helped other printers that are fairly new to
the industry (like me), in doing their projections and planning.
Like you said, it s not a means to an end, and you must adjust them up or
down, depending on your own business, but it sure helps to have an industry
average to start with.
Also read with interest your response to the new print sales rep. Quick
estimates has given us the edge many times, and as you said, although it
would be hard to come up with an estimation sheet that covers all variables,
it certainly helps increase your knowledge of questions to ask if you try.
Each time we have to have to do a new printing of our sheet, we ve come up
with another variable to add to the list.
In reference to Martin Turnbull.... that would like some input from other
wives
of the printing business... I was unsure if he wanted articles from
other women involved in the business, or wives who s husbands are in the
business and they just
help
...? Let me know, and I ll submit a couple and
see what you think. At Creative Connections, I m the owner and my husband is
the one that helps out as needed (pressman sick, print job overload, etc.) as
he manages another business. But, I write personal articles of interest on a
weekly basis for my editorial, and would give it a shot. Let me know!
Again... thanks and keep up the good work.
Sharon
Thanks, Sharon. Keep warm. Jerry wants to know about adding a sales rep as a
contract employee.
Subj: Expansion?
Date: 96-03-05 18:24:37 EST
From: JeroldS1
To: TomCrouser
First off I hope you are well.
I am a broker working out of my house, and have a cross roads ahead. I have
been approached to work for somebody or I was thinking about another sales
person. In order to expand sales I have the opportunity to bring into my
business another sales person at commission only. Can I do this as a 1099?
The thought of employees brings shivers up my spine, been there, not good
experience. This person would have no base only 10% commission and is
experienced. Are there any pot holes that you know about? What are your
thoughts.
Thanks, JeroldS1(Jerry Sherman)
Hey, Jerry. If you bring in another sales person, they can work for you on a
commission basis but I doubt if it would be wise to 1099 them. Contract
employees are a very narrow group and have to comply with very specific
conditions. In this case, the sales person would have to represent several
lines of products being sold by other companies, be
really
independent from
you in setting selling times, territories, customers, etc. But, you re
falling into a very narrow range where you might be able to do it if you
wished (I still don t advise it for if interpretations are wrong, the
penalties to you are high. Penalties include all taxes and penalties and
interest of what should have been withheld.) However, check with a Certified
Public Accountant or tax attorney before you do this.
And here s one solution to Peter Grogan s (Ink Kraft, Inc., Jacksonville,
Florida) question of finding system administrators for our networks.
From: CopycatOfc
To: TomCrouser
Tom, I would like to address one of the issues recently brought up in your
report - the need for system administrators. We are quite heavily
computerized - network Docutech, color RIP, DTP department, computerized POS,
8 station office network, clients with Launch.
We have a 25 hour/week grad student that handles all of our network issues.
He is gaining hands-on experience and we give him a flexible schedule (other
that the
the server just went down, I need you here in twenty minutes
type
of emergencies.) For our part, we get someone that is familiar with our
set-up and who costs us a fraction of what a professional sys-op would.
I can t imagine being in our business today without this kind of technical
expertise on-board. Between dealing with emergencies, software upgrades,
hardware upgrades, reconfiguring the networks for additional
devices/workstations, it is an almost full-time job. Not only that, but
because of our dependence on computers it is a job that can t be left for a
more opportune time since any problems incapacitate either our production or
our customer service.
An owner/CEO that takes this task on him/her-self makes the decision to put
their other responsibilities on the back burner. This will hurt any size
business much more than the expense of a sys-op.
Bob Stor....Copycats
Thanks, Bob. Gestur Traustason in Iceland found us on the internet and has
replied to an earlier question regarding AccuSets and ECRM s. Go to it,
Gestur.
Subj: AccuSet 800 vs. ECRM 36
From: gt@ht.is (Gestur Traustason)
To: TomCrouser@aol.com
I am a consultant in electronic publishing systems with experience in
choosing imagesetters for my customers. Initially I would not hesitate to
recommend the AccuSet 800 set-up. I don t know whether you were advised to
take the Viper 1.5 without HTA or the 1.9 PCI. You could possibly get the
price down by choosing the Viper 1.5.
The main complaint about the AccuSet 800 is speed. The Viper 1.5 is fully
capable of running the AS 800 at maximum speed, so the Viper 1.9 would be
overkill.
The AS 800 has several advantages going for it.
- It is VERY precise, giving great and steady quality film after film. There
is no compromise in quality between the AS 800, AS1000 and AS 1500.
- You have Agfa Balanced Screening, which is one of the best screening
options around.
- It uses HeNe as opposed to IR on the ECRM, which is a more stable laser and
cheaper film and waste.
- The repeatability for AS 800 is +/-1mill over 8 seps as opposed to
+/-1.5mil over 4 for the ACRM.
- The AS800 is upgradeable to an AS1000 or AS1500 should the need arise.
- The Viper is a true Adobe Postscript RIP. ECRM offer Harlequin clones. They
are faster, but a clone is a clone.
The AccuSet has been very service free so I would not consider a service
contract a major issue.
Since you are already paying $30.000.- a year for output consider what you
could get if the output were in-house. You would both save the $30000.- PLUS
possibly get some bids that you could not get while contracting out. Also by
experience if you purchase a quality
system such as the AccuSet you can probably raise the quality of your jobs,
thus increasing income.
My only complaint for the AS800 is the speed issue. Therefore my last piece
of advice: consider the AccuSet 1400. Although more expensive it does not
require a dedicated Mac to RIP and is a lot faster, plus the option of
on-line processing.
Gestur Traustason, Reykjavik, ICELAND, gt@ht.is
Thank you Gestur for your expert advice. Now back to the hot issue of income
statements and my footnote about loans. Michael from Oklahoma writes:
Subj: Re: Crouser Report: Income Statement Changes Needed
From: Michae0912
To: TomCrouser
TOM - How true...your closing statement about loans. I ve always found when
I don t WANT a loan they literally show up in my mailbox by the pound. When
I NEED a loan, by banker has always
just left for a two week vacation
...
Thanks for the humor...and the excellent column. MIKE - Printing Center,
Bartlesville, OK
Thank you, Mike. Speaking of the same topic, this next reader wants my use
of direct materials explained. Here tis.
From: ERWIN38348
To: TomCrouser
What do you consider Direct Materials? Paper? Chargeable Materials, Outside
Services? Factory Supplies? Packing? Repairs & Maintenance? Please explain.
We use the PIA format.
Okay, dokey. One of the reasons I use Direct Materials is to clarify rather
than obfuscate (wow)! Many accounting theorists argue over what needs to be
included in the Cost of Goods Sold. That is the heart of your question. Is
repairs and maintenance a cost of good sold for if you produced nothing you
would have no repairs and maintenance. The Printing Industries of America use
a chart of account which tends to support this view which is known to me as a
manufacturing view.
However, I just avoid all of that and so does most of the research in the
small press segment of the industry (okay, quick printing industry) by
focusing on one component of cost of goods sold: direct materials. Materials
which go directly into the product such as paper and ink and fountain
solution. Now, fountain solution doesn t go directly into the product does
it? Well, even though we could split hairs over that, in my measurement it
does. So does plates and negatives and services purchased outside are
included but repairs and maintenance, and packing are not.
Thanks for the excellent question.
Tom
Ken Strauss has a slightly different take on our Independent to Franchise
discussion. He discusses the thread of the topic of sharing or not sharing
information with others.
Subj: Re: Independent To Franchise? Opinions Part III
From: kstrauss@purgatory.legendcomm.com (Ken Strauss)
To: TomCrouser@aol.com
As a supplier of imposition software, we have certainly run into the problem
that many of our service bureau customers are unwilling to talk to reporters
or writers. We can only assume that, having found a competitive advantage,
they prefer to retain it. Refusing to tell your advantage, however, also
means that when you get in a jam, it s hard to find someone to get you out of
it.
This short-sightedness may also be ascribed to many branches (not all) of
Xerox and Kodak. Since they charge by the impression, telling people how to
get more billable pages on each sheet may reduce the number of impressions or
machines sold. It appears they only pass on the word when the customer
insists they won t buy without a satisfactory answer.
As to franchises, they share the same inertia as all big companies. Most of
our customers are in-plant (especially in the computer business) or
independents.
Thanks, Ken. Bill Powell has something to add to our plate charge discussion.
Here s Bill.
Subj: Plates & More
From: BillPrints
To: TomCrouser
Tom, I know I m a little behind times here. I just got around to reading the
Plate Charge fracas from 2-23. Well, here s my two cents.
First, I see a lot of focus on cost plus pricing. This school of thought is
great for analyzing your pricing methods, but to use it on a daily job-by-job
basis is a money loser! You either lose the job or leave money on the table.
We are in the printing BUSINESS not a Girl Scout cookie sale. It seems a lot
of folks are selling the wrong thing. We sell our customers the UTILITY of
the completed job, not the pieces-parts that make up the job.
Doing Itemized billing is VERY dangerous. According to the laws in Virginia,
if it s listed on the invoice or quotation, the customer owns it. I m not in
business to sell negs, flats, plates, cutting dies, special tools, or all the
paper (including the waste and left-overs). I m selling a completed job which
has a purpose and thus utility to the customer. Imagine you re building a
house. The contractor needs a special blade for his saw to do the house your
way. The price for the blade is included in the price you paid for the house.
You get the finished house, not the saw blade. Too many people are giving
away their
saw blades
because they think it s the only fair thing to do
with the customer. In fact what they are doing is giving away their invested
assets!
I found out a long time ago that my customers (mostly small and medium
corporations) value consistency in pricing, not the lowest price for this
muffler. Quick printers, more that any other segment of the industry have
really bought that line from the muffler ad. Maybe we watch too much TV?? !
Good customers buy based on value and service. If yours want the lowest
price, send them to WalMart!! By the way, I charge for the basic N-F-P every
time I do the job. I do not charge for the specialty prep items again
(process seps, spreads, chokes, outlines, halftones, etc.). The guys who
nickel-and-dime the prices down, drive the market values down. This makes it
more difficult for all of us to earn a living. Too many printers sell too
cheap. This in turn gives the buying public false expectations of what
quality printing costs. Many of our walk-in public give us grief over our
pricing. They take it across town, to a guy who probably doesn t even cover
his overhead, because it costs less. Then they come back to us and have the
nerve to complain about the quality of his job. Obviously, you do get what
you pay for.
I almost forgot, there was some mention of color ink charges, too. We charge
ink & wash-up on every job item. If you are a long-standing customer or a
high dollar order with multiple items using the same inks, we will give a
credit for part of the ink & wash charges for the second, third, and fourth
items and list this separately at the bottom of the invoice. We list it as a
volume purchase discount. This way if you reorder the letterhead only from an
original package of five pieces, the price is still the same as the one
listed on the first invoice. It s consistency...Always.
Thanks for your Support, Tom
Bill Powell
Thank you Bill. Now, as a follow-up to our selling a business series, Jim
Bailey writes:
Subj: Re: Letters: Selling to an Employee
From: PIPBAILEY
To: TomCrouser
Thanks, Tom for your excellent response. Since my letter to you we have
continued to explore the possibility of ownership by our employee. I guess
buying and selling a business is much like marriage and divorce. It is
sometimes easier to get in than get out. We find we are having to deal with
the tax implications of corporate capital gains as well as personal capital
gains if we sell outright for cash. It s always so gratifying to have a
smart CPA ( a specialist in structuring small business sales) tell you that
your first CPA ill advised you to become a
C
corporation, and therefore
your tax situation at sale time is not ideal. The smart CPA, however, says
there are other options in structuring the deal. All in all estimates about
$16,000 to pull it all together with all the CPA and legal fees involved in
structuring buyout and drawing up contracts etc.
Your comment about selling the business to the wealthy non-printer buyer for
well in excess of value sounds more attractive every day. Your comments
regarding the skill level attributes of the ideal buyer help us establish a
basic framework for a training program. The Dale Carnegie Course would be
valuable for the current owners to take as well.
Tom, it is refreshing to come away with more answers than questions. Your
real world experience makes a difference. Maybe you can add the topic of
business succession to your
Seminars to develop when I have time
list.
Thanks again for your response.
Jim Bailey
And thank you, Jim. On the same subject, Ed N. writes us from Charlotte,
North Carolina. (Sharon, it is not as cold in Charlotte as it is on the North
Slope of Alaska).
Subj: Re: Selling to an employee
From: ENOW626
To: TomCrouser
You re right on re: selling to other than a cash buyer. Cash is best,
however, I have two sons and a superb production manager to whom I plan on
selling my business. We meet regularly to discuss transition over the next
years (8 or so) and discuss openly how it is to be structured.
My primary focus is to set the desired corporate structure which breaks down
into marketing, production & finance. First we figure out the blocks - then
we fill them. The older son will be the CEO, in fact it could turn out that
the production manager could be. That decision is not critical because there
will be from 2 to 4 players and the sales and profits will support that cast.
They must cough up a committing sum (minimum $25,000) which must come outta
their hide. No $$$ invested - no commitment!! I have determined what $$ I
want and that is my focus. The entire plan points to that aim.
I once told someone that the most important planning in a business is HOW TO
GET OUT. He disagreed - - - kinda sold his business, then a few years later
out of the clear blue called me and told me that I had been right. Right
ain t what I want to be - but a planned exit is what I want to accomplish.
Keep up the good stuff. Ed N.
Thank you Ed. And you all keep up the good stuff until next time. And keep
those cards and letters coming in. Happy Trails. Tom
For information on Performance Groups click here
Crouser & Associates - Helping Printers Prosper Since 1985
Crouser & Associates Performance Group program includes two on-site evaluations
by Tom Crouser each year along with two group meetings. Management training is held during the group
meetings along with participation in a meeting with non-competing printers. Join others who have decided
to run their business instead of the business running them. Reply to by Email to
Tom Crouser for more detailed information or call Clark Workman
at (304) 342-5100. Or fax (304) 342-5187 or contact crouser@ibm.net.
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Tuesday, April 09, 1996 6:29:41 PM
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