Presented by

Translate

Monday, July 23, 2012

The Forgotten Art of Customer Service

In these days of consumer confidence near historical lows, it's tougher than ever to get potential customers to make that purchase. The one area where consumer sales are still brisk is online sales, where the shopping experience is highly personalized - one can get on and make a purchase in seconds, or browse and compare items for hours in privacy...and then make the purchase in seconds with a simple click, click, click.

But fortunately for us (or perhaps, unfortunately) most wooden and home improvement items don't fit well with the online sales model. Most folks want to sit in a chair, or swing the doors on a set of cabinets, or walk on a floor sample in a showroom before they're sure that it's exactly what they want. After all, you're spending real money, not $14.95 for a paperback novel (or $8.95 for its electronic version).

Which is why The Wife and I headed out for a day of shopping together this weekend. We had some vague ideas of improving the entry way in our house, but we weren't sure where to start and sought some help from "the experts". Our first stop was at the Big Box, to the aisle labeled "Window Treatments". I don't know about you guys, but those two words send shivers down my spine every time I hear them. Visions of spending too much money on something you're trying to look past...just doesn't make sense, man.

Our Big Box started out about five years ago as a pretty nice place, full of helpful employees with cheerful faces wrapped in tidy aprons that outnumbered customers about two to one. But since then, store management has managed to weed out all those helpful employees, and the only ones left are those who you have to chase around for a while, before you can achieve eye contact with them...and when you finally do, they'll point you to a row with an indication that your items are "down there".

Our window treatment specialist was "busy" with another customer; he was staring with animosity at a computer screen while the lady he was "waiting on" was standing silently by the counter with a helpless look on her face. At first, we milled about trying to survey what the store might have to offer, but since none of the products were priced we realized pretty quickly we needed some help to even start making some comparisons. So we joined the lady at the counter. I tried giving the guy my famous Evil Eye to get him to acknowledge us, or the lady, or that there was life on Earth...but nothing could make him shift his weight or bat an eyelash from the screen in front of him. This went on for about twenty minutes, with The Wife getting increasingly frustrated.

We had made the mistake of bringing along the seventeen year-old and the two Young Ones, and he was touring them up and down the aisles in one of those over-sized kiddy shopping carts, the ones with two seats. He was pushing them about 30 miles per hour, they were screaming in delight, and shoppers were jumping out of the way in panic as the giant plastic box on wheels hurtled toward them. All this while, we stared at the zombie at the computer, he stared at his screen, and the other lady kept glancing at us every time a scream was heard in another area of the store. Finally, as The Wife's children careened by us for the third time and slammed into a washing machine, we gave up and headed for the exit, and the Young Ones started crying because they were having fun and didn't want to go.

We made a strategic decision and decided to drop the perpetrators off at home before hitting another store. After doing so, we decided to try a place where we could get some help, even if it cost us a little (or a lot) more. We headed to an interior design store with one of those trendy names that gives no hint of what kind of store it is, but clearly indicates that everything in it is overpriced. We were greeted at the door by a yapping little fur-ball, the kind that would make a nice mouthful for a real dog. I peered into the store to make sure it was alright to let the little darling out "to play", but he was saved by a smiling young lady who didn't seem to notice how annoying the little rat was.

Once past the guard dog, we entered the empty store and told the "studio manager" what we thought we were looking for. She didn't know anything about window treatments, which was odd because the entire store was filled with them...but we were in luck, because there was an expert in the back of the store. She went to fetch him.

Ten minutes later, a cool-looking Euro dude came strolling out...he sized us up, and instantly came to the conclusion that we weren't worth his trouble. Maybe it was my Texas Forestry Association t-shirt; whatever it was, he proceeded to make our shopping experience as fruitless as possible. Every question we asked, he answered with. "It depends on what you want..." - which was obvious, I thought, but somehow we had hoped that he might be able to help us at least define the parameters of the Window Treatment Problem. But after fifteen minutes of his expert needling to get The Wife and I in total disagreement about why we even came in the store, we walked out in exasperation...and I had the distinct feeling he was smirking behind our backs.

Well, the atmosphere in the car was chilly, to say the least. I decided to try to warm things up a little, and since it was lunch time, I pulled into my favorite sports bar which happened to be just a block or two down. It wasn't a wise decision. The Wife remained stone silent as we pulled in and were led to a table. The entire meal had the cozy ambiance of Marshall Petain's surrender to Hitler in 1940; and guess who was speaking French? Oui, mon amis.

At this point we both knew that the window treatment thing was a lost cause. Besides, the Euro guy had generously conceded to come visit our house next week to humiliate us some more. So, The Wife "suggested" a visit to a lighting store on the other side of town...I exhibited the wisdom of the French general and went along with the suggestion.

It was at the lighting store that the day turned for the better. At the door we were greeted by a lovely sales rep named Violet, who welcomed us to the store, asked what we were looking for, pointed out a few pieces, and retreated with the suggestion that she was available if we needed any help. And in a few minutes, we did. The Wife was looking for something "fun and bubbly", while I had in mind something that said "wood". Naturally, we were in different parts of the store. Violet noticed the discrepancy, gave it a few minutes to simmer, and then moved in to referee our exchanges.

She moved me away from the wood mindset by showing us an somber, oriental-looking thing that fit my mood and was nonetheless interesting to The Wife because of its intricate paper-art shade. We liked it, but it wasn't quite the perfect thing. This is where Violet really got to work. She led us to the catalogs, and started showing us different products, taking each comment of ours and moving us closer to our mutual vision. Her knowledge of the catalogs was impressive, and she kept comparing the items to certain pieces on the floor to give us the proper perspective. She even started giving me subtle visual and verbal cues on when it was OK to comment, and when to keep my opinion in check.

It worked. So well, that within a half-hour or so, we had not only found the perfect piece, but we both felt vindicated; it was fun and bubbly, with a metallic hint of somber woodiness (but without the wood).

During our search, an elderly couple had parked their new Cadillac a respectable distance from our ten-year old Suburban and entered the store. In their eighties (at least), he pushing she in a wheelchair, they were obvious regular customers of Violet's; they wouldn't let the other sales rep in the store wait on them. They moved to the rear and began to give Violet The Eye. This is where Violet pulled the ultimate in customer service. Finding an appropriate place in our catalog search to leave us for a moment (but not too abruptly), she took just a couple of steps toward the big spenders and, leaning in toward the lady in a personal, confidential manner, whispered to them that she would only be a few more minutes with us and asked if she could get them anything for their comfort. Their demeanor relaxed, they smiled, and retreated slightly to allow Violet to finish with the peasants.

Now, the fixture we were looking at was not cheap. In fact, I've had several cars that cost less. Nor was it going to fulfill our need for immediate gratification; it had to be made to order in California, and would take three weeks at the minimum to arrive. But we were at the point where we knew it was this one, or get the heck out of the store. Which normally, we would have done.

But as my lovely queen of marital bliss stood gazing longingly at the picture in the catalog, it occurred to me - why not? After all, I was going to buy something...why not buy it here, and now, from Violet, who had really earned my business, instead of giving my business to some disinterested lackey? So it cost a little more. You have to pay for real quality, right? Right. No contest. We bought the light. And the next time you visit the Ray mansion, you will be dazzled at the front door by the most expensive thing in our house.

Which is the moral of this story. Everything Violet did was perfect. She turned our exasperating day out into our very best experience of the day, the week, maybe even the month. In a lighting fixture store! And her company profited from it.

In this day and age when just about everyone, including the competition's sales force, is downbeat, it pays to remember that people still do have money...they just don't want to spend it. But if you can turn their experience in your store, on a call with you, or on your website into one of their very best experiences, something that lights up their day and makes them remember when it was fun to spend money, you will greatly increase the likelihood of getting some great business that you didn't expect. That's really the only way to reliably make money in this economy.

The Wife just called. We need a new light for the dining room. Violet is waiting for us. Got to run.


Wednesday, July 18, 2012

Housing Starts, Banks Sending Misleading Signals on the Economy

We're all looking for some good news out there. So sometimes we see it where it ain't. A colleague of mine sent me this article authored by no less than the famous Jim Cramer of CNBC.
An astounding read on housing 
A report from Wells Fargo reveals a booming mortgage business -- and a U.S. economy in fine shape. 
By Jim Cramer Mon 9:22 AM 
If you took the time out to read the report of Wells Fargo (WFC -0.72%) -- and, believe me, there was time to do it -- you would have been pretty much stunned at how much business it's doing and at how strong the mortgage business is in the U.S. Put the following facts in perspective from a company that has more than 30% of the mortgage market in this country. 
  • Mortgage business revenue was up 90% from a year earlier and 11% from the prior quarter. 
  • Revenue from refinancing was up more than $19 billion, or 43%, from the first quarter, "indicating continued strength in the overall housing market, where we see increases in sales and pricing in markets throughout the country, even some of the hardest hit areas during the slowdown," according to CEO John Stumpf. 
  • A 31% increase was achieved in commercial loan growth, through portfolio acquisitions and organically increased credit card penetration. 
  • Credit quality continued to improve, with the charge-off ratio declining to 1.15%, the lowest since 2007. 
  • Nonperforming assets declined by $1.8 billion from the first quarter, down 11% from a year earlier. 
  • Record net income rose by 17%, with earnings per share up 17% from a year earlier. "Mortgage volumes have been much stronger than anyone expected a year ago or even three months ago, for that matter, with originations more than double where they were a year ago, and our mortgage pipeline, which should lead to future revenue and expense growth, has also doubled," according to CFO Timothy Sloan. 
These are astounding numbers. They're the kinds of numbers that signal a gathering strength in housing, something that few people expected and fewer still had thought possible, given that the economy was supposed to have hit a wall a few months ago.
 - MSN Money

My response to my hopeful colleague was this...

I think he's wrong...look at his bullets. The first two are just saying that whoever can still qualify to re-finance or purchase an investment property is doing so now, because rates will never get lower. The third bullet has nothing to do with housing. Bullets 4 and 5 just reflect that the higher-risk loans are being gradually replaced with current loans being given only the those with money and perfect credit. Bullet 6 reflects this and as a result, the bank is making more money.


The bank is cleaning up its loan portfolio by virtue of the minority of folks who have money and credit. That's a far cry from reflecting a "gathering strength in housing".  Cramer's confusing bank profits with housing strength...not the same thing.


My outlook is more in line with this article...


Analysis: In the U.S. housing market, recovery or Lost Decade?


Thanks, will make another great blog post....


cdr

Today brought more reason to mistakenly think the worse may be over...housing starts were up in June.

June U.S. housing starts up 6.9% to highest level in four years

But considering that housing permits were up in May, this was no surprise. And since housing permits are down in June, I guess we will be hearing next month that housing starts were "unexpectedly" down in July.

Yesterday, Mr. Bernanke was morose in his testimony to Congress on the economy, and Mr. Geithner admitted today in an interview by Larry Kudlow at the Delivering Alpha conference of big investors that the economy today is much slower than at the end of last year. And that the solution is...to "govern" and raise taxes when it is politically unpopular, so that more economic incentive programs can be funded.

Which brings us around to NYU economics Professor Nouriel Roubini in a recent interview on the state of the global economy and how it will impact America. You may notice that he touches on many of the same "spike" factors I touched on in my January forecast of global lumber prices...Middle East volatility, oil prices, their impact on Europe and China, and their link to our economy.



Don't be misled by the misdirection of current news reporting. The long-term trend is still stagnant, and foreboding unresolved issues lie ahead. Hope for the best, and plan for the other.

Friday, July 13, 2012

Woodworking in 2012 - New Zealand Pine

Another excellent look at the modern wood industry. This one is a video from the New Zealand Pine Manufacturers Association, and it displays many of the same messages of the Holzindustrie Scheighofer video shared in the last post: sustainable harvest, processing efficiency, and response to markets. Especially interesting is the segment showing the value-added processing being done in Korea, and the pine-home construction in Japan.

 

I did a double-take on one line in the video: "Their [New Zealand wood products] distribution to market is frequent and quick, thanks to New Zealand's relatively central geographic location, and world-class shipping infrastructure."

Relatively central geographic location? Relative to what, Antarctica?

But that the good folks of the NZPMA could even claim this with a straight face is a testament to the fact that modern logistics is no longer a constraint on the world's economy, but an enabler of it. Something we here in the U.S. need to take better heed (and advantage) of.
"New Zealand pine manufacturing.... A quality resource. An industry built on integrity. It's products guaranteed to provide customer satisfaction."
That's a pretty solid marketing line, and a fine ending to a convincing video. More of this, and many more may find themselves Going Wood.

Thursday, July 12, 2012

Woodworking in 2012 - Holzindustrie Schweighofer

In contrast to the old-time woodworking of the last couple of posts, I thought you might enjoy seeing what state-of-the-art wood manufacturing is like these days. If you're not familiar with modern, profitable operations, you might be surprised. They're not:

  • dirty
  • wasteful
  • exploitative of the resource
  • manual labor intensive
  • or politically incorrect
as those old movies seem to portray. Rather, the best companies these days build on a foundation of sustainable harvest, efficient processing, and responsive marketing.

You'll see all three in the following corporate video by Holzindustrie Schweighofer, a great and profitable Austrian company that owns and operates several businesses in Europe. This is what a wood company should look like in this day and age. Be sure to notice that they are sorting logs by diameter prior to sending them into the sawmill...this increases efficiency and speed of processing, all the way through to final shipment of the lumber product.


  

This type of management yields results and spins off great ideas. The Schweighofer family initiated the Schweighofer Prize in 2002, an annual prize awarded to leading innovators in the European wood community. It is this kind of commitment that makes the heart of every kind of woodsman proud to Go Wood.

Thanks to my friend John Krier for the tip on this great company, and to the folks at Holzindustrie Schweighofer for sharing their excellent video.

Monday, July 9, 2012

Bruce Scholnick - A leader for the times

A leader in the pallet industry passed today.
"Bruce N. Scholnick, who has led the National Wooden Pallet and Container Association (NWPCA) as its president and CEO through a number of dynamic industry shifts, died of cancer at his home in Alexandria, Va., July 9.
Bruce devoted his considerable energy and astute mind to the wood packaging industry from the moment he joined it in May 2000. His task-focused approach was at first misinterpreted as impersonal, but members soon recognized that what was driving Bruce was a passion for assuring their sustained success and that of the industry. His mission was to “help our members make and/or save money” in every program and activity he pursued.
Bruce was a warrior on Capitol Hill and with Washington regulators when proposed rules threatened the industry. His tenacious dedication in all he did earned him the respect and affection of NWPCA members.
Prior to his years at NWPCA, Bruce was Division Vice President of Member Services & Products for the National Association of Professional Insurance Agents, V.P. of Corporate Planning for Thatcher Manufacturing Corporation (a division of Dart & Kraft Industries), and Director of Marketing and Economic Research for the Glass Packaging Institute. He brought a wealth of experience and insights to his position at NWPCA.
Bruce’s most often repeated quote was “creativity is merely the insightful rearrangement of known elements.” That concept was put into practice on a regular basis. He never allowed staff to grow too comfortable or complacent in their tasks. Bruce regularly challenged staff to identify innovative ways to deliver member products and services and create valuable new ones. He was most demanding on himself and was constantly seeking to identify industry opportunities that were as of yet undiscovered.
Bruce was preceded in death by his wife Elizabeth in April 2008. He is survived by their son Matthew, sisters Nan Parker and Penny LaPorte, and their husbands and children.
NWPCA Board Chairman James Ruder has asked Sam McAdow of Buckeye Diamond Logistics, in South Charleston, Ohio, to act as Interim Acting President to serve as a point of contact for staff and membership. Sam will be operating in an advisory capacity and will report to James Ruder. Sam can be reached at his direct phone number at 937-462-7515. James can be reached at 303-355-5083.
Association leaders will advise the membership soon as to a way we can join together to honor Bruce as an industry."
- The National Wooden Pallet and Container Association, 7-9-2012 

Thanks, Bruce. You were a good friend and colleague, a steady hand in the storm and a driving force in the doldrums. There is one star less in our sky tonight.



"The Wooden Wonder" - The de Havilland Mosquito Bomber

The narrator in the video of the last post conveyed the attitude that woodworkers of the WWII era pretty much felt that they could build anything of wood. We've already seen that they accomplished this on the seas with the wooden patrol torpedo boats; but like on the seas, battle in the air had evolved to steel and aluminum-alloy duralumin as early as the end of World War I. However, shortages of these metals forced aircraft designers to meet the high replacement rate of fighting aircraft with another type of raw material.

As it always seems, man turned back to wood. Aircraft designer Geoffrey de Havilland, who had been building aeroplanes since his youth in 1910 and so had experience with wood in flight, submitted a design to the British Air Ministry for a prototype light bomber that incredibly had more speed than the famous all-metal Supermarine Spitfire fighters that had won the Battle of Britain. Because of its light weight and handling characteristics, the prototype was eventually named the "Mosquito", and after proving its potential in numerous trials, de Havilland won a contract and began production.


Mosquito B Mk IV serial DK338 before delivery to 105 Squadron - this aircraft was used on several of 105 Squadron's low-altitude daylight bombing operations during 1943.  http://en.wikipedia.org/wiki/De_Havilland_Mosquito
The Mosquito lived up to its name in warfare, proving an annoying adversary to German Luftwaffe pilots. In fact, the Mosquito was so maddening to the Luftwaffe general staff that two "kills" were awarded to any pilot who successfully shot down one Mosquito.

But the attribute that makes the Mosquito live on in the hearts of many old-timers in the United Kingdom, Australia, and Canada was its construction of wood. With strips of Ecuadorian balsawood sandwiched between 7/16" 3-plys of Canadian birch, the shell of the Mosquito proved strong enough for extensive use in the war, and in the years after. The following  Australian news reel video shows the manufacturing technique, and in it we see that wood and glue, when mixed properly and with ingenuity and enthusiasm, can produce remarkable man-made machines.



A couple of interesting facts: the Mosquito is a forerunner of the de Havilland "Dash" series of commuter planes that I would guess every frequent flyer has boarded at one time or another. And for you classic movie buffs, the Mosquito's designer Geoff de Havilland was a paternal cousin of the lovely and charming actress Olivia de Havilland, who won our hearts in movies such as Captain Blood, The Adventures of Robin Hood, and Gone With the Wind.

A fitting connection, as the de Havilland Mosquito bombers were also gone with the wind before opposing pilots could get them in their sights. And all thanks to the fact that the British Air Ministers decided to Go Wood.

Tuesday, July 3, 2012

Woodworking in the 1940's

Independence Day holidays, in whatever country they occur, are frequently nostalgic occasions to look back on the greatness of a county's past. And while we tend to reflect first on military histories, our independence is linked as strongly to our accomplishments in industry and application of our common work ethic. Here's a great old video about woodworking as it was conducted in the 1940's. As you watch the film, you'll notice how much woodworking processes, and the labor they required, have changed in the past 70 years. But as you do so, listen to the narrator's comments on the challenges in the industry, and you may notice that in many ways, the wood industry still faces the same challenges...employee development and availability, response to market preferences and demands, and technology advances.

 

In the next post, I'll share with you one of the great products produced in this era by wood workers and designers.