As a business owner, you must do your research and learn to forecast what the next few years will look like for yourself and the economy, while trying to reach your goals at the same time. No matter the size of your company, it is important to learn this sooner rather than later.
This year, we have had a ton of changes in our economy, including more companies buying each other out, several smaller companies along with larger companies closing their doors, and all during a time when we have the next five years of the largest retirement group, the Baby Boomers, leaving the workforce.
Before I dive into all that, let’s hit the pause button and talk about what we did with our company this year and why. In 2022 and 2023, our company grew by 42% which equaled a $1.2 million growth. During those two years, we invested in the following:
- 3,000-square-foot building
- UV laser
- Direct-to-film technology
- UV printer
- More embroidery machines
- Secondary showroom for uniforms
- Mobile showroom
- Proprietary software
- Increased staffing
That is a lot to undertake in just two years for us two business owners while selling products and keeping up with the growth. So, before 2024 began, our focus was not going to be on growth. Last year was focused on streamlining each department, cleaning up, improving our company morale, improving our training, and focusing on our production. Why you do this amid such growth? Well, not all growth is good. During major growth periods, you will have growing pains that hit, and we had hit several without anticipating.
Error rate
Our error rate in the first quarter of 2024 rose above our 2% goal and we could not figure out why by simply talking to management or staff. This is where my wife and I were frustrated. How could people not know or explain why it was happening? So, my wife and I, along with our daughter, teamed up in multiple areas and discovered several things were happening right under our noses.
Our No. 1 issue at the time was that we had a general manager of 13 years and a design manager of 10 years who were stonewalling us without us knowing it. This was a huge issue considering I personally trained them years back to be my left and right arm. They both knew our 18-year-old son was coming on full time and our 21-year-old daughter was already working full time with us, and though that was never the plan, the kids fell in love with the company. What we did not know is both of the managers were highly against it and never told us. So, they did not want to see the company grow and they did not want to work with our kids, which created a companywide issue as consistency in quality and morale started to slip.
What neither of them realized is that by the kids coming in and learning everything, they actually protect the company from failing. If anything happened to my wife or me, the kids can keep the company running. This protects all of the staff and customers.
Needless to say, both managers left on their own terms once they realized we would not allow them to continue on the negative path. This was the hardest time in our company’s history to work through. It was easier to physically move the company 11 years ago than it was to go through that.
Investments
Over those past two years, our sales were strong, but our rate on our investment was not. In a nutshell, we achieved all this extra growth, and the net profit increased, but not nearly as well as it should have. As a business owner, looking back, you start to question your sanity. Why did we work this hard to net this much and for what?
So, we said enough is enough. After dealing with the two managers, we explained to our children what we saw happening and what we needed to do to work with our existing managers to fix it all and get it all back on track even better than ever before. We held a company meeting, and we were fully transparent with our team about the new company mission and goals. A handful did not get on board and they were removed from the company. Those were also the people who were often negative, took extra time on breaks, came in late, refused to retain basic information, etc. Then we attacked our artwork files and organization further. We built in continual training all year.
Prepare to pause
What is the moral of this article? Never be afraid to hit the pause button! Because we did, our sales are down 6% equaling around $225,000. Our minimum growth rate is 15% yearly. Now, I know what you are thinking — that’s a huge loss. But that is where you are wrong.
Because we had the will power to hit the pause button, our staff are happy at work. They’re working together and training each other faster than before. Our error rate is back to 2% or less. Instead of us being one to three days ahead on orders, we are an average of four to six days ahead. Our design team went from handling 30 to 40 proofs daily to handling 50 to 70 proofs each day. Our wasted overtime is next to zero. We did a quarter less in sales and netted a higher profit than the previous year. This was a massive mental win for us as the business owners and we know over the next six months of this year, even doing the same numbers, we can extract $75,000 to $100,000 in profit out of our company from fixes that occurred in the past six months.
So, while the world’s markets were all over the place, companies were going out of business, businesses were being bought out, and so on, we were internally making our company more sound and ready for more growth than ever before.
What are we planning in 2025?
- Increase sales by $500,000 to $750,000
- Maintain all our standards that are currently in place
- Make final plans to build in 2025/2026 to make our newer building around 12,000 to 16,000 square feet larger
- Focus on continuing to improve our internal software
- Keep streamlining where we see opportunities to do so
The hardest thing to do is not grow your company when that is all you are used to. Doing so takes a lot of willpower, but I am here to tell you it was not only the hardest thing in business to do, but the most rewarding as well! Seeing happy customers and happy staff while we all win together is priceless. Here’s to a great start in 2025.
