Tools You Must Consider to Control Profits in 2006 – And Beyond (Part one of three)

Since this is a three part article, please watch for the remaining portions over the next two months.  As I travel internationally consulting, I continue to come across the same problems time and time again.  The biggest problems I see are (in no particular sequence):

1. A total lack of or very poor systems in place.

2. Poor purchasing.

3. No performance pay.

4. More employees then the amount of monthly revenue can justify.

5. No financial metrics.

You must prepare yourself and your yard for positioning.  If you are not ready to position yourself when a windfall or better yet an opportunity presents itself, then your windfall or opportunity will soon be eaten up with the inefficiencies in your yard.  All will be lost and you will be back to square one.

Systems – In order for a system to be effective, it must be scaleable.  This means the system will work equally well if the monthly sales volume is $25,000 per month, $150,000 per month, or even $350,000 per month.  If your systems are not scaleable, then at some point they will breakdown under the volume and stop working.  When this occurs, some or all employees must stop performing their primary function, whether it be selling, delivering, dismantling, etc. and go into the special project mode. 

In the special project mode, we must design and implement a new system or worse yet, clean up and rearrange the old system.  This activity almost always causes a reduced service level, loss of focus and the end result is a loss in business.  When you lose business, it is always more difficult to get it back the second time then it was to achieve it in the first place.  Nearly every place I visit I find what I call, “The Make System,” of placing vehicles in the yard. Chevrolets are up on the hill, Fords are down in the valley, Chrysler products are over by the creek, and so on.  This system does not work and is not scaleable.  No matter what size area you designate for a particular make or model, you will invariably obtain more of that make or model then will fit in the area, and too few of another.  Next thing you know, all the makes and models are mixed up again. 

I believe this system originates from either not having a yard management system already in place or not trusting the information in it.  A much better system would be to label each area with a sign.  For example: YA for yard area A, YB, YC and so on.  Then, make up signs for rows 1, 2, 3 and so on.  Place a stock number on each vehicle, then enter the vehicle and its location in the yard management system.  Know that this is a scaleable system.  No more wasted time, lost sales or vehicle damage from moving vehicles around to get all of a particular make or model in a designated area. You do have a yard management system, don’t you?  If you do not, this is the first system you need to install.  You will find it gradually more difficult to stay in business during the 21st century without a computerized yard management system.

If you do these things, you will be prepared to position yourself to take advantage of any opportunity or make the most of a windfall if one comes along.

Remember, only you can make BUSINESS GREAT!

Don’t forget to go the website for my new book,, to learn all the backroom business terms. There are 1,200+ terms in over 300 pages, with hilarious illustrations by world famous Gahan Wilson. You can register there for your free weekly “green weenie.” If you want to know what a three fingered booger is, or what’s in a train wreck envelope, it’s the only place to go!

Remember only you can make business great!

Ron Sturgeon, Mr. Mission Possible, has been a successful business owner for more than 35 years. As a small business consultant, he can deliver wisdom and advice gleaned from an enviable business career that started when he opened a VW repair business as a homeless 17-year-old and culminated in the sale of several businesses he built to Fortune 500 companies.Ron has helped bankers, lawyers, insurance agents, restaurant owners, and body shop owners, as well as countless salvage yard owners to become more successful business people. He is an expert in helping small business owners set the right business strategies, implement pay-for- performance, and find new customers on the web.

As a consultant, Ron shares his expertise in strategic planning, capitalization, compensation, growing market share, and more in his signature plainspoken style, providing field-proven, and high-profit best practices well ahead of the business news curve. Ron is the author of nine books, including How to Salvage More Millions from Your Small Business.

To inquire about consulting or keynote speaking, contact Ron at 817-834-3625, ext. 232,, 5940 Eden, Haltom City, TX 76117.