Business Observation – 2011 – the year of the “Survival of the Leanest”?

So here we are at the beginning of a New Year - again.

Contemplating our businesses future as a small business owner in a large economy – again.

Looking back, Pacific Northwest Print & Fulfillment had a good fiscal year in 2011. We recognized our dream of expansion by moving from a small 4,000 square ft facility spread between two buildings, into a single much larger 11,000 square ft facility more centrally located in the heart of Spokane Valley. This we did in order to accomodate our future fulfillment and print expansion needs – and so far so good – more businesses appear to keep finding us and using our services. Sure the move did come at some cost to our profit margin, and working in a larger space does of course take more financial resources than in the smaller space - but we’re on our way and poised to have a great year in 2012!

What concerns me as a small business CEO however, is that when contemplating 2011′s ups and downs in the “big business” community, it seems to me that they’ve adopted what I can only term as a ”survival of the leanest” mentality? Take this with a grain of salt - as it’s only my opinion, is based soley on general observations made via news sources over the year…

With a few exceptions, it appeared to me that most big businesses that did “ok-to-good” in the 2011 economy were shedding overhead (typically human resources) one moment, and in the next were reporting good-to-great profit returns back to their shareholders. But one has to ask – at what cost to our local, regional, and global economies? Having worked for larger fortune 500 and 100 companies in the past, I understand how perceived Shareholder Value and Risk Management play a role in a businesses key financial decision making policies, I get that. As a small business owner, I also carry similar resource concerns when it comes to the costs of maintaining a workforce – it’s not cheap, has it’s own risks, and the true costs are rarely understood by the employees who benefit from them the most.

Again, I understand that businesses vary, and that this commentary is only based on my own general observations…

However, if more businesses in 2012 continue to simply protect corporate shareholder profits, while continuing to cut human resources – I fear for what 2013 might look like in terms of corporate mind-share, unemployment and entrepreneurial opportunity both in the U.S. and abroad?

I guess what it boils down to for me is a hope that instead of focusing on 2011′s economic contraction, that we as business leaders (large and small) focus instead on 2012′s growth and expansion. Let’s work to expand employment opportunities (as I hope to later this year), with the knowledge that we as individuals and employees can and do make a difference - starting today.

Chris Ballard

CEO, Pacific Northwest Print & Fulfillment, Inc.

What are the Skills and Experience Required for Entrepreneurship?

I was recently asked this question and thought that since I invested some time in replying, that perhaps it was worthy of a post – I’ll let you decide…

My entrepreneurial experience so far indicates that it’s a constantly changing mix of Investment, Vision, and Risk…

Investment takes the form of financial, human, and physical resources that constantly require adjustment because change is the only constant in today’s business environment. Financial investment is the easiest of the three – it comes from either self-funding/personal investment or infused-funding from outside sources.

Vision’s a little more tricky… it requires experience, insight, agility, and the ability to effectively direct your resources to achieve today’s goals,while identifying and moving the organization to realize tomorrows opportunities. Experience comes from the hits and misses and is a refining process that over time defines the leader. Simplified, insight is a combination of market understanding and gut instinct. Agility is the capability to move quickly within the marketplace and to adjust to changing demand – not an easy task by any means. Directing resources requires leadership recognition by everyone involved, and presumes that everyone on the bus is headed in the same direction at the same time – again, not an easy task but achievable.

Risk is by far the coolest attribute of entrepreneurship. It’s the driving force behind vision and investment that gets the job done – or not. Risk takes many forms. It’s a decision to right-size current operations or expand into the future. It’s the resource investment in the next big product or innovation that’s going to change the game; and conversely the wrong decision to invest in something that takes you down an inappropriate road that could crush your ambitions. The successful entrepreneur learns how to correctly balance or manage risk against reward. Noone’s perfect at balancing risk against reward, everyone makes mistakes, the important thing is to learn from them and to keep moving forward.

Well, that’s the reader’s digest version I’ve come up with anyways – hope it’s helped you in your quest to understand the entrepreneur (at least this one) a little better.

The bottom line really is to simply enjoy what you do and to do it well.

Best Regards,
Chris Ballard
CEO, Pacific Northwest Print & Fulfillment, Inc.

Expansion or Contraction?

I’ve adopted a rather simplistic viewpoint when it comes to understanding the lifecycle of any business. You might agree with me or you might not, but one thing I’ve begun to notice is that all businesses are either in a state of expansion or contraction… It doesn’t seem to matter what industry, market, product, or segment you manufacture or service.

Change it seems is a constant that makes no preferences, and so all businesses large or small must plan for, deal with, and accept change as a way of life – or suffer the consequences of not recognizing or preparing for it – but either way change delivers an opportunity for businesses to either expand or contract.

Expansion it seems is always a positive, but does Contraction always result in a negative? Anyone have an opinion or related experience?

Fulfillment Systems Technology – What’s Right For You?

Years ago, while working for a large Technology company, our marketing department ran into a logistics nightmare head-on. Back then it was common practice to outsource work to multiple fulfillment companies around the world to meet our communication needs regionally as well as locally. The challenge occurred when we tried to manage multiple vendor ordering interfaces worldwide.

The problem boiled down to which system to run for which vendor and how to maintain a single view of inventory, cost, and distribution control for the organization. The core choices haven’t changed that much over time, it basically comes down to these three considerations:

1. Do we use our own internally-grown and supported database?
2. Do we use a particular fulfillment partners proprietary application?
3. Do we use a Software As A Service (SaaS) option?

We tried to use our own in-house solution – basically a Microsoft Excel spreadsheet on which we attempted to manage our incoming and outgoing order information. It worked for a short time, however grew into a burdonsome nightmare in its own right. Small businesses can typically survive in this fashion, however multi-billion dollar companies should never attempt it – as we later admitted to ourselves.

Following this, we jumped from managing multiple vendors to managing only a few vendors, through their in-house ”proprietary” software solution. Some of the solutions we tried worked well, while others were like undergoing a root-canal without anesthesia. As you can also imagine, it became a headache everytime we needed to change vendors. And we typically ended up paying more than we felt these services were ever worth.

Ultimately, we settled on the Software As A Service (SaaS) model, we contracted to use InterlinkOne’s online software system to interface with all our print and fulfillment vendors worldwide. Today, it’s still one of the SaaS software tools used by our company to manage inventory, orders, tracking, and reporting on behalf of our clients worldwide. We now had a robust inventory and order management system at a monthly fraction of the cost of buying or development of proprietary software.

So what’s my point you might ask?

Only this, that regardless of which model is working best for you today, it’s well worth investigating which options are (or will be) supported by your current or future fulfillment partner tomorrow.

Take the time, ask us the questions, reap the rewards of a better informed decision!

Transitioning from Good to Great

A collection of inspirational thoughts from Jim Collins, the writer of the book “Good to Great – Why Some Companies Make the Leap… and Others Don’t”

Here are a few great insights from the book…

“Greatness is not a function of circumstance.  Greatness, it turns out, is largely a matter of conscious choice.”

“Those who build great companies understand that the ultimate throttle ongrowth for any great company is not markets, or technology, or competition, or products. It is one thing above all others: the ability to get and keep enough of the right people.”

“Yes, leadership is about vision, But leadership is equally about creating a climate where the truth is heard and the brutal facts confronted. There’s a huge difference between the opportunity to “have your say” and the opportunity to be heard. The good-to-great leaders understand this distinction, creating a culture wherein people had a tremendous opportunity to be heard and , ultimately, for the truth to be heard.”

Needless so say, the rest of the book is simply great… I’ll share more of his insights in a future blog.

Will that be paper, plastic, or corn starch?

It sounds like the question you usually get at the supermarket – will it be paper or plastic?

Today’s environmentally-conscious business owner who chooses to outsource their order fulfillment operation should be asking do you use paper, plastic, or corn starch? As product packing materials have come of age, progressive fulfillment providers are offering a wider range of reusable and renewable materials.

Packaging paper remains an industry staple when it comes to box filling material, kraft papers are typically recylced and offer a cheap, reliable, and easily recylced alternative for lightweight shipping.  It’s a good choice, unless the item you’re shipping is too heavy or bulky enough to crush the material in transit – in which case you might consider plastic…

Plastic you say - how can that be environmentally friendly?  In an attempt to avoid an environmental scandal here, let’s just agree that it simply depends on your perspective.  For example, is it better to grow and chop down a tree to create the paper in the first place; or is it better to use recycled plastics to create an air-bag filling solution that when you’re finished using it can easily be recycled again?  Then there’s the whole question of how much weight does paper vs. air really add to a shipment, and thusly the use of oil and petrol products to transport it… well you get the picture.

Gone are the days of the styrofoam peanut – it’s given way to a new packaging option – the corn starch peanut.  It melts in your mouth – and I can say that from experience, not by choice really mind you, but that’s another blog.  In any event, it’s another lightweight alternative to getting your product in the hands of your customer safely and efficiently.

So go ahead, ask your fulfillment provider how they’re packaging your orders – because I guarantee that one day your customer will ask you.