ofdealer november 2010

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OFDA is very sad to report the pass-ing of industry analyst and consultantBarry Coyle of SolomonCoyle. Barrypassed away peacefully on theevening of November 15 at his homein Ojai, CA, in the company and careof his wife, Gayle Wyborny, and theirson, Brian Coyle.

As reported by SolomonCoyle princ-ipal, David Solomon, the progress ofBarry's cancer, though very rapid,was far outweighed by the courage,thoughtfulness and good cheer withwhich he lived his final months. BarryCoyle will be greatly missed by a hostof family and friends and by the manypeople with whom he forged personaland professional relationships duringhis 33 years as a practitioner, consult-

ant, teacher and mentor in the con-tract furniture industry.

Barry also was a highly respectedvoice on the OFDA Board of Gover-nors for many years and frequent pre-senter at OFDA conferences andseminars at NeoCon.

In accordance with Barry's wishes,no funeral or memorial service isbeing planned. The family will issuean obituary in the near future.

OFDA’s official publication, OFDealer,will feature a final article to the indus-try written by Barry just a few weeksago in its December issue. In the arti-cle, Barry shares his thoughts andhopes for our industry in the comingyears.

news

At Office Furniture Innovations in Houston,the champagne was popping and thensome for founder and president JayneEdison after she was named Woman Busi-ness Owner of the Year by the Houstonchapter of the National Association of

Women Business Owners (NAWBO).

An industry veteran with nearly 20 yearsof office furniture experience, Jaynestarted Ofi in April 1999, literally workingout of her hall closet.

She’s come a long way since then. Her

NAWBO award is the latest in a long lineof honors that includes recognition bythe Houston Business Journal as thecity’s Fastest Growing Woman OwnedBusiness and 2006 Dealer of the Year forKrueger International.

PHOTO: BARFIELD PHOTOGRAPHY

‘Woman Business Owner of the Year’ Honors for Houston Dealer Jayne Edison

CONTINUED ON PAGE 4

NOVEMBER 2010 OFDEALER PAGE 3

Barry E. Coyle (1947 – 2010)

“It's all about attitude,” she says. “You might be working in

that closet today, but think big. Don't think that you're working

out of the closet. Don't think that you're working out of your

home, and don't put it to the public that is what you are doing.

Put out to the public what you can do."

Jayne attributes much of Ofi’s reputation as a reliable business

partner to her staff, who she describes as "an office full of

leaders." She says her organization is small but able to suc-

cessfully take on the largest accounts and she’s got multi-

story projects from clients as far away as Africa and Aruba to

prove it.

And even though she says the market today is more crowded

and challenging than ever, that hasn’t slowed her down too

much.

For the Ofi team, that translates into the addition of new import

lines and used furniture as well as a venture, coming early next

year, into the movable walls business.

“Business is still out there,” she maintains. “You just have to

work harder to find it and be willing to be creative and move

with the market.”

Twenty-Five Years and Counting for AustinBusiness Furniture, Texas Allsteel Dealer

Congratulations to Jay Femal and his team at Allsteel dealer

Austin Business Furniture, who last month celebrated their

25th year of service to the Central Texas business community.

An industry veteran with over 30 years' experience, Jay and a

partner started the business in 1985. Jay became sole owner

in 1990.

Like everyone else, the ABF team has found the past few years

challenging to say the least, but things have been looking up

since late August, Jay reports, and he’s back in hiring mode,

having recently added a new designer and currently looking

to bring on another salesperson.

“It hasn’t been easy, but the good news is that we’re not just

treading water anymore and we are starting to see signs of life

in the commercial market here,” he says.

That sounds like something worth celebrating and that’s ex-

actly what Jay and his team and several hundred customers,

business partners and prospects did last month at a special

25th anniversary party. Here’s hoping they—and the rest of

us—will have even more to celebrate in the coming year!

Pacific Office Interiors, Haworth Dealer, Aims to ‘Build Transformations’ Through Habitat for Humanity Project

Pacific Office Interiors’ Free Taylor and 12th Street’s Nikki Jaggs onthe job for Habitat for Humanity.

Since opening for business in 1986, Free Taylor and his team

at Haworth dealer, Pacific Office Interiors in Agoura Hills, CA,

have taken as their tagline, “Building Transformations.”

Last month, they took that theme and gave it a special dimension

of community involvement by putting together a 30-person

team to work on a Habitat for Humanity project in their local

market.

This was the dealership’s second year in a row hosting a Habi-

tat for Humanity project. In addition to staff from the dealership

itself, customers and representatives of the local A&D com-

munity came out for a full day’s work to help build housing for

people in need.

“We believe there’s an opportunity in every project to do

something exceptional and literally transform the people,

space and businesses we touch through our work,” Free main-

tains. “Habitat for Humanity is a perfect experience in this re-

gard, as we truly are building transformations for our attendees

and the future occupants of these homes.”

Dealer News ~ CONTINUED FROM PAGE 3


CONTINUED ON PAGE 5

Perry Office Plus Partners with HON to Overhaul Classrooms

In Central Texas, students running the gamut from elementaryschool all the way up to university level are going to find schoolwork a whole lot more productive and enjoyable, thanks toHarry Macey and his team at Perry Office Plus and a generousassist from the HON Company.

Harry’s dealership recently completed its third annual schoolmakeover contest and this time, they really went the extra mileand then some, with four separate makeovers worth a whop-ping $100,000 in total!

The contest started earlier this year, when local schools wereencouraged to nominate a room for a furniture makeover inone of four categories: elementary, middle school, high schooland college/university.

The dealership received dozens of entries and narrowed themdown to just three or four in each category and then asked thepublic to vote online for the winners.

Over 16,000 votes were cast and after the votes were verifiedand duplicates removed, about 12,000 votes were tallied toidentify the winners.

Representatives from Perry and HON made a special trip tocongratulate and consult with each of the winners. Themakeovers were handled by Perry furniture consultant JessicaSpeer, who helped the winners through the process.

An elementary classroom that is shared by two classes andtwo teachers got new HON SmartLink desks and mobile stor-age so the class can easily combine or divide as needed.

A 40-year-old middle school library replaced chairs that wereas old as the building and the Perry team helped build aunique panel “wrap” around the aged circulation desk for afresh face.

A high school computer lab now has furniture appropriate forthat use and a tutoring space at a local community college hasan updated and more comfortable place for students to seekassistance, thanks to some panels and HON Huddle tables.

WorkSpaces, DC Area Inscape Dealer, OpensBaltimore ShowroomNo matter how tough the market may get, there’s always newgrowth opportunities to be found if you’re out there looking forthem. Just ask Tom McGuire and his team at Washington, DC-based WorkSpaces.

Tom opened his dealership just four years ago, hardly idealtiming by any measure. But the challenges of the past fewyears haven’t dampened his entrepreneurial spirits any, sowhen the opportunity came up to open a beachhead in Balti-more, he seized it with both hands.

The result: a sparkling new 5,000 sq. ft. working showroom tohighlight the dealership’s Inscape, Kimball and Vitra offeringsand the rest of its product portfolio.

“Growth in the Baltimore market is evident across a numberof industries,” Tom reports. “The Defense Dept’s BRAC re-alignment process alone is opening tremendous opportunitiesthat are particularly well suited to our expertise.”


CONTINUED ON PAGE 6

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New Home for Business Interiors of TampaIt wasn’t much more than a five-minute drive for Mark Tramon-tana and his team at Business Interiors of Tampa to move fromthe location they had called home for the past ten years to anew facility. But the move has made a big difference for thedealership.

Mark’s new showroom boasts close to 65,000 square feet, upfrom 25,000 in their previous location, and that means newopportunities to expand inventory and display product farmore effectively.

And while the current downturn has made business a realrollercoaster, Mark says, it’s also made for an ideal time tomove. “We’re getting more than double the space that we hadfor about what we were paying for our old location,” he says.

Timing on the move looks good, too, with Mark reporting moresigns of forward movement in the Tampa market of late.

“It’s going to take a while still but things are starting to moveup and when business comes back in earnest, we’ll be morethan ready in our new location.”

Widmer Interiors Announces Opening ofRockford LocationWidmer Interiors is pleased to announce their expansion intoNorthern Illinois. Kurt Kieser is general manager for this office.Kurt is a Herman Miller certified healthcare specialist andbrings with him over 18 years of sales and management ex-perience.

As the Herman Miller dealer in the Rockford, DeKalb and Au-rora areas, Widmer Interiors will focus on commercial, health-care and education projects. Widmer Interiors is a HermanMiller Certified Dealer; one of only 49 dealers in the U.S. to holdthis accreditation. Widmer will now operate out of four loca-tions in Illinois: Rockford, Peoria, Champaign, and Normal.

“Widmer has served healthcare customers in Rockford for 15years, so opening a full service location in Rockford is a naturalfit,” said Frank Gutwein, president of Widmer Interiors. “Welook forward to providing our new customers with the sameexcellent service that Widmer has provided for over 45 years.”



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Michael A. Dunlap & Associates’ mostrecently quarterly survey of trendsamong office furniture manufacturersprovides further evidence of forwardprogress.

The survey’s overall index of industry per-formance for October came in at 56.65,the highest level since July 2007. For pur-poses of the survey, an index of 100

means things “couldn’t be better”, anindex of 1 is “absolutely the worst” it canbe, and an index of 50 means it is neutral;no change “up” or “down.” Among thehighlights of the October survey:

• Gross shipments jumped to68.55, and order backlog in-creased to 62.36

• The employment index increasedto 53.75, while hours worked roseto 54.60.

• Both capital expenditure andtooling expenditure indexes im-proved significantly in the thirdquarter.

• New product development in-creased to 65.00, above the 26survey average of 63.58.

• The Personal Outlook Index in thesurvey (57.17) is the highest sinceOctober 2007 (59.10), and is wellabove the 26 Survey averages of(56.25).

Dunlap commented, “I’m very pleased bythe results this quarter. The improve-ments are almost across the board formanufacturers and suppliers. I am notsurprised at the significant increases ingross shipments and order backlog, andI am delighted to see the increase in thepersonal outlook. It appears that the sup-plier community is almost as optimistic asthe office furniture manufacturers.”

The survey repeats in January 2011.

Latest DunlapSurvey ShowsContinuingIndustryImprovement

Earlier this month, the Business and InstitutionalFurniture Manufacturers Association (BIFMA) re-leased its market statistics for September and onceagain, the news was generally positive.

For the seventh straight month, BIFMA reportedyear-over-year order growth, with September’s or-ders up 19% on the same month last year.

September shipments increased 17% year-over-year, the fifth consecutive month of year-over-yeargrowth for the industry and the largest monthly per-centage increase since April 2005.

“Consistent with the recent reports from Knoll andHNI, the September BIFMA statistics were strongand largely corroborate our favorable industry the-sis,” noted industry analyst Budd Bugatch.

“Broadly speaking, corporations have now deliveredfour consecutive quarters of year-over-year EPS

growth, balance sheets are flush with cash andbusiness confidence continues to stair-step higher,”he said, and even though the unemployment rateremains “stubbornly high,” Bugatch noted the econ-omy is adding jobs at a modest, though unspectac-ular pace.

Bugatch pointed to some positive indicators for in-creased project business, citing an increase forSeptember in the Architect’s Billing Index to 50.4 inSeptember, the fourth consecutive month of im-provement and, importantly, the first time the indexhas been above 50 (the line of demarcation betweenexpansion and contraction) since January 2008.

In addition, he noted the Conference Board’s surveyof U.S. office space construction spending for Oc-tober posted the smallest monthly percentage de-cline since July 2009


CONTINUED ON PAGE 9

BIFMA SEPTEMBER NUMBERS: Seventh Straight Month of Growth in Orders

Senior Management Changes Coming at TeknionTeknion Corporation recently announced several new seniorexecutive changes. Frank Delfino, president, world markets,will retire from his current position with the company effectiveMay 1, 2011. Delfino, who joined Teknion Furniture Systemsin March of 1995 as EVP and COO, will be appointed chiefstrategic officer and special advisor to David Feldberg, presi-dent and CEO of Teknion Corporation. Delfino will also pursueindependent business ventures, the company said.

In his new role, Delfino will focus primarily on Teknion’s keyclient relationships and help to evolve the company’s long-term strategy, especially in the area of acquisitions and jointventures. In addition, Delfino will facilitate the smooth transi-tion of his current role.

Concurrent with Delfino’s departure from his current position,Teknion will be reorganizing its worldwide sales structure. Thecompany announced the following appointments.

• Scott Deugo, who holds the position of senior vicepresident, design, marketing and sustainabledevelopment, will be appointed to the position ofsenior vice president, North American marketseffective May 1, 2011. In addition, Deugo will maintainresponsibility for the company’s worldwidesustainability initiatives.

• Effective May 1, 2011, and as part of the transition,Teknion’s international sales will report directly toFeldberg. Also effective May 1, 2011, Joe Regan willbe appointed to the position of senior vice president,design and corporate marketing.

Steelcase Supports ‘School Pride’ With Best-in-Class Education Furniture for Detroit High SchoolEarlier this month, viewers of School Pride, a brand-new NBCtelevision series showcasing public school renovations, sawvolunteers and educational solutions from Steelcase in action.

Airing nationally on NBC, the episode chronicled the makeoverof outdated classrooms to classrooms of the future at theCommunication and Media Arts High School in Detroit.

“With 100% of seniors graduating and a dropout rate of virtu-ally zero, Communication and Media Arts High School is oneof Detroit’s top institutions,” said school principal DonyaOdom. “However, like many high schools and universitiesaround the country, our classrooms need to transform andbetter support our students and educators. This makeoverwas a dream come true for our institution.”

Industry News ~ CONTINUED FROM PAGE 8


CONTINUED ON PAGE 10


Steelcase donated $150,000 worth of product to the project,and more than 50 employees volunteered to help unload fur-niture, paint and clean the 52-year-old school, which was inmajor disrepair.

In fact, the school was on Detroit Public School’s cut list,which would mean closing the building and sending the 480students to other schools in the district.

Steelcase donated a media:scape technology table, cobichairs and lounge settings from the Turnstone Campfire col-lection to the school library and for classrooms node, the newclassroom chair from Steelcase Education Solutions.

Office Furniture Manufacturers Supporting 20-20 Visual Impression Knoll, Kimball Office, National Office, Allsteel, Allseating, Logi-flex and Inscape are among the manufacturers currently en-riching their catalogs for 20-20 Visual Impression, a newvisualization program due to be launched by 20-20 Technolo-gies in January 2011.

Visual Impression will add full-scene, manufacturer-specific,3D color visualization to 20-20’s commercial product portfolioincluding 20-20 CAP Studio, Giza Studio, and Worksheet.

The company said the program makes visualization feasibleon every project by creating high quality output in a shortamount of time.

It is designed as a companion product to CAP, Giza and Work-sheet and is intended to dramatically improve communicationbetween designers, salespeople and customers.

Office Furniture USA Hires Regional Managerfor NortheastOffice Furniture USA has hired industry veteran Bob Malloy as itsnew regional manager for the Northeast, covering Connecticut,Maine, Maryland, Massachusetts, New Jersey, New York, NorthCarolina, Pennsylvania, Vermont, Virginia, and Washington, D.C.

Malloy brings to the company some 20 years of industry experi-ence on both the dealer and manufacturer side of the business,having held account management and regional management po-sitions with Haworth and Teknion and having served as a salesdirector with dealerships in New Jersey.

“The insight Bob can bring as both a manufacturer and a dealerwill be a tremendous asset to us,” said Brad Armacost, presidentof Office Furniture USA. “He’ll be able to draw upon his experienceto help support our new and existing dealer partners as we con-tinue to grow sales and add more dealerships to our program.”

Kimball Office Products Now Available in ICE Software Ice Edge Business Solutions, creator of ICE design/configu-ration software, and Kimball Office have announced the re-lease of Kimball Office products on the ICE software platform.Dealers and designers will now be able to leverage the visual-ization capabilities of ICE for sales and marketing efforts in-volving Kimball products.

Features of the Kimball Office catalog in ICE include accuratepricing of furniture layouts within an immersive 3D environ-ment and photo-realistic renderings at the touch of a button.

Virtual tours of the design will allow for quick and easy review ofconceptual designs with clients, modifications to the layout orfinishes and updating the specifications and pricing in real-time.

Kimball Office’s ICE experience can be enhanced withICErender and ICEvision, enabling decision-makerswithout design backgrounds to fully understand whatthey have ordered.

Global Launches Graphic Series, New Seating LineGraphic from Global Total Office is a new series ofoffice seating developed by world-renowned de-signer Zooey Chu.

The chair back features a new mechanism thatplaces the pivot point directly below the operator’ships, allowing both the user and the chair back topivot from the same point in a natural motion.

Graphic’s slim, Euro-style back is contoured sideto side for comfort and top to bottom, integrat-ing a lumbar support. Back options include fullyupholstered, breathable mesh and a durabletextured nylon back.

Industry News ~ CONTINUED FROM PAGE 9


Federal Appellate Court Hears Arguments on Florida’s InteriorDesign LawAfter several months of waiting, the 11th Circuit Court of Appealsin Montgomery, AL, earlier this month heard arguments on behalfof Florida interior design community appellants who have beenchallenging the federal constitutionality of Florida’s interior designpractice law.



OFDA filed an amicus brief earlier this year in

support of the appellants’ case and has been

monitoring developments in this case for the

last couple of years.

Florida’s law includes extremely restrictive

and burdensome provisions that have

impacted dealers and other members who

provide space planning services and OFDA

has paid special attention to this case and ad-

vocated for amendment of the statute.

Florida’s law requires companies to not only

employ, but also have a principal owner or of-

ficer who is a licensed interior designer in

order to legally perform space planning serv-

ices that are routinely performed in 47 other

states throughout the country.

Since a variety of ongoing initiatives are un-

derway in several other states to amend state

laws to require some level of increased regu-

lation of interior design practices, OFDA also

is monitoring those developments and contin-

uing its efforts to ensure that dealers can con-

tinue to legally offer and perform essential

space planning services that are appropriate

to the needs and budgets of their clients.

Clark Neily, attorney for the Institute for Jus-

tice, supporters of the appellants’ case, pre-

sented legal arguments before a panel of

three judges.

Neily noted that Florida is one of only three

states that regulate the practice of interior de-

sign and highlighted several areas in which

Florida’s interior design statute violates the

constitutional rights of the appellants.

In oral arguments, Neily focused on the issues

of protected speech and the interstate com-

merce clause and emphasized that there are 8

or 10 cases to support the appellants’ position.

Appellate Court Judge Black asked about the

state’s claim that Florida’s interior design law

is necessary to protect public health, safety

and welfare.

Neily reported there is no evidence that the un-

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regulated practice of interior design jeop-

ardizes public health, safety or welfare.

As such, he argued that Florida’s exces-

sive regulation of interior design services

is unnecessary, burdensome and anti-

competitive.

Neily noted the Supreme Court has ruled

that the key points of inquiry in these

cases relate to the “practical effects” of

the challenged law, rather than to vague

descriptions of the law in question and

its intent, which government defense at-

torneys often present when defending

the challenged statute in court.

Jonathan Glogau, counsel for the state,

challenged the Institute’s legal case, ar-

guing that Florida’s law is not discrimi-

natory and that the district court had

found no burden as a result of the law.

He contended licensure is necessary as

a result of the need for interior designers

to understand building codes.

The judge asked him to respond to the

appellant’s specific arguments that: 1)

Florida’s law restricts the out-of-state

practice of interior design services un-

less the involved designer is licensed in

Florida and also is a principal/officer of

the corporation; and 2) there is no

demonstrated public health, safety or

welfare threat and no public benefits of

the state’s regulation.

Judge Black also asked for a definition of

“non-structural elements.” Mr. Glogau cited

the court’s dais as an example but could

not identify other, more common examples.

Neily in his rebuttal and the Institute’s

appeals brief provided a number of

other examples which highlight the

broad range of office furniture, such as

workstations, and other interior “non-

structural elements” impacted by the re-

strictive law.

He concluded that: 1) Florida’s law does

in fact impose a substantial burden on

interstate commerce; 2) the state had

not provided evidence in defense of

Florida’s interior design law and its prac-

tical impact; and 3) existing, far less bur-

densome alternatives in 47 other states

for promoting claimed public benefits

make Florida’s restrictive law “arbitrary

and irrational” and indicate that it is un-

constitutional.

It is not clear how quickly the appellate

court will rule on this matter, but OFDA

will continue to monitor this case and re-

port new developments as they occur.

A copy of OFDA’s amicus brief and the

Institute for Justice’s appeal are avail-

able on the OFDA website at www.of-

danet.org/index.asp?bid=4437.

OFDA News ~ CONTINUED FROM PAGE 11


http://www.NationalOfficeFurniture.com

http://www.of-danet.org/index.asp?bid=4437

http://www.ofdanet.org/index.asp?bid=4437

http://www.of-danet.org/index.asp?bid=4437

Jim Heilborn is an independent business consultantand trainer who specializes in the office furniture

industry, working with dealers, manufacturers andservice providers. He has been a speaker and

contributing writer to OFDA for over 7 years. He canbe reached directly at 916-434-8711 or

[email protected]. His website andbusiness archive can be seen at

www.jheilbornassociates.com.

Imagine for a moment that you are the captain of alarge fishing boat out on the ocean. You are standingon the bridge, looking out toward the horizon. Alsoknown as the helm or the navigation station, it is fromhere that you and your senior crew steer the ship andplot its course.

On a lower outside deck, your fishing crew may becasting their lines or throwing out their nets, hoping toland some “big ones.” This deck gets a lot of your at-tention because it is more visible and is also the sourceof the boat’s income.

On another deck, probably below that one and possi-bly inside, other workers are tending to the engines,mending nets, storing previous catches and generallyhandling the daily operations of the boat. While thisarea also gets some of your attention, it is not as visi-ble and tends to get less notice than the higher deck,primarily because their tasks are in support of the ac-tivities of the fishing deck.

By Jim Heilborn




http://www.jheilbornassociates.com

Located below the waterline sits what is called on some boatsthe Orlop deck; the lowest deck on the boat. Because as cap-tain you are often very busy with the activities on the decksabove and it is primarily just a place where things are stored,this area doesn’t receive the same attention as the more ac-tive, visible decks above.

It is usually left up to members of the crew to inspect and re-port back what is, in their opinion, a situation that requires yourattention.

That could be a problem, because they may miss somethingimportant…and that is where most leaks begin.

Does this thinly veiled analogy sound familiar? Is your “boat”leaking? Is your “crew” giving you all the information you needin a timely fashion? Do you know where the leaks are and howto plug them? Do you know how to prevent them from gettinglarger, or even worse, sinking your “ship”?

Every company has areas that leak money. It is nearly impos-sible to prevent every possible cause, as new problems anderrors pop up on a daily basis.

Stronger companies realize that and plan ahead. Based onpast experience, they can often predict where many of theleaks might occur and prepare contingency plans in order tominimize the damage.

So where should you start looking for leaks? Here are a fewideas for you and your “crew.”

Days Cash on Hand: Is Trouble on the Way?The cliché, “Cash is King” will always remain true. Looking atyour liquid assets is always a good place to start…so lookingat your “cash on hand” is critical.

One of the leading causes of bankruptcy is a company’s in-ability to bridge gaps in cash flow. If your company is struckby a major disaster, either man-made or from natural causes,how long can it be sustained before you run out of money?

There are times when companies do everything correctly andyet there is a sudden lull in sales. If companies don’t have thecash to pay vendors, the vendors hold shipments. The com-panies can’t deliver orders and therefore can’t do any billing.

In some cases the companies don’t have enough money to paytheir employees and taxes and closing is the only option left.

It is therefore very important to know how long you would beable to survive before running out of operating capital (or evencredit line).

Cover Story ~ CONTINUED FROM PAGE 13



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Often known as “days cash on hand,”your controller or financial advisorshould be able to provide this numberto you at any time, but if not, here is aformula you can try yourself.

Unrestricted cash +

cash equivalentsx

(365 ·–· total operatingexpenses – depreciation and

amortization) =

days cash on hand

It’s a good idea to identify best andworst case scenarios, along with someother possible variations. Preparingcontingency plans can prevent a com-pany from going under.

Accounts Receivable: Maintaining StabilityOne of the most common sources ofprofit leaks found in companies is inAccounts Receivable (aka collections).Unfortunately, it is not unusual to handoff managing this vital task to staffmembers without the experience orauthority to obtain final resolutions.Thus timely collections are not alwaysreceived.

Even companies not facing a slow-down in sales can suffer from cashshortages due to slow payments fromcustomers or payments withheld dueto unresolved customer service issues.

Many companies don’t produce a reg-ular report or hold regular A/R meet-ings that include the employeesdirectly involved with the client. Inother companies, reports are producedbut not reviewed closely enough bymanagement.

As a result, they are often unawarethere is a problem until the customerstarts complaining or the cash starts torun out! And by that time it may be-come difficult to get all of the pay-ments, resulting in both client and

revenue losses.

Accounts Receivable reports should bedistributed no less than every otherweek and an A/R meeting held at leastonce per month. Attendees should in-clude management and also thosecharged with resolving any issues.

In order to get a quick overview, com-panies can use two measurements totrack the A/R and collections. The firstone is called “DSO” for “Days SalesOutstanding.”

This is the average number of days thatall clients maintain an outstanding bal-ance on their accounts. If the com-pany’s standard terms are net 30 days,the goal would be to have the averageDSO at thirty days or less.

The higher the DSO the more nega-tively cash flow is impacted. Reducingthe time it takes to collect receivablesis one of the best ways to increasecash flow.

While it is always a challenge to keepthe DSO as low as possible, it is evenmore difficult in this economy. It re-quires even more attention and vigi-lance than in the past.

The second measurement companiesshould analyze is the A/R report.Based on the standards set by creditbureaus, a healthy company’s total A/Rshould be, at minimum, in these per-centiles (or better):n 75% of total A/R should be cur-rent (under 30 days).n No more than 10% of the totalA/R should be in the 31-60 DaysOutstanding column.n No more than 10% of the totalA/R should be in the 61-90 DaysOutstanding column.n No more than 5% of the totalA/R should be over 91+ days.

It is much easier to identify leaks bycomparing your percentiles to theseguidelines. The earlier you discoverslow paying clients, the easier it is toresolve a problem and receive pay-

Cover Story~ CONTINUED FROM PAGE 14



ment. The longer you wait, the greaterthe chance that you may have to take awrite-off.

The Annual Budget: Trailing IndicatorsMost companies spend time creating anannual budget document. It is a shame,therefore, that so many spend little or notime reviewing or discussing it through-out the year.

Leaks, both large and small, are mucheasier to discover when budgets are re-viewed regularly. The sooner they’refound the more readily plugged…but itdoes require that someone take the timeto look for them.

While the P&L statements are also im-portant to review, a good budget docu-ment will have more specific informationand in greater detail. It allows managersto get a faster snapshot and comparisonof the company’s performance, allowingthem to make the necessary adjust-ments prior to problems getting furtherout of hand.

While there are many different formatsand versions for budgets, there is somekey information that should be includedin every budget and represented by acolumn in the spreadsheet. They in-clude:n Forecasted revenues—by monthand total yearn Gross sales and gross marginn Forecasted expenses—by monthand total yearn Actual revenues, year-to-date—by month and total yearn Actual expenses, year-to-date—by month and total yearn Actual sales, last-year-to-date—by month and total yearn Actual expenses, last-year-to-date—by month and total yearn Next to revenue columns thereshould be one showing each entryas a percentage of the total. n Next to expense columns thereshould be one showing each entry

as a percentage of sales.

Using this basic format, it is easy to seeif sales are keeping up with expenses.By comparing each expense as a per-centage of sales, it becomes clearer ifadjustments need to be made.

Reviewing the budget and each compo-nent regularly doesn’t fix a problem. Itprovides only a trailing indicator that aproblem exists or is on the way. Correc-tions still must be made.

Armed with this information, however,the manager knows which direction heor she must take to work on the problem.

Leading Indicators: Predicting the PathLeading Indicators are the markers youlook for to steer a clear path. They helpyou make corrections and point thingsin the right direction before it is too lateto turn things around. Leading Indicatorscan be found in many areas.

The Leading Indicator for sales is theforecast…weekly, monthly, annually. Itshould be the first sign that you are stillon course to reach your gross sales andmore importantly, gross profit goals.

If the forecast does not support thebudget, corrections must be made be-fore the year starts and then throughoutthe year. This could mean reductions instaff, variable expenses, or expansion.

If the gross sales target looks fine, butnot the gross margin, corrections mustalso be made. Most companies cannotsurvive on volume alone.

Another good Leading Indicator is thecompany’s “break-even” number.

It is very helpful to know when you willbreak-even every month and start to beprofitable. It is also a good idea to let theentire staff know what they need to doto reach this number…to identify theirindividual contribution…whether it is interms of sales, productivity, efficiency, orcost-savings.

Everyone in the company should under-stand their role in keeping the companyafloat.

I’ve already written about Cash Flowand A/R, but they are also Leading Indi-cators.

Another important Leading Indicator canbe found in the Design department. Arethey busy laying out new opportunities?Are there enough new projects on the“boards” (now in the computers)?

Is the error rate going up? That can in-dicate too much work and not enoughpeople or that staff changes are possiblyrequired. Either way, it costs the com-pany money.

The Installation and Delivery depart-ments are great Leading Indicators. Arethere many installations scheduled outinto the future? Are delivery trucks goingout with full loads?

Just measuring the number of stops canbe misleading, as a driver can makemultiple stops and only deliver one ortwo pieces per stop. Those becomevery costly deliveries.

Before the captain of a boat leavesshore, the smart ones will chart acourse, look at weather conditions,complete inspections and take everyprecaution to insure they reach theirdestination. The same holds true for abusiness.

Unfortunately, every year, business own-ers and managers must embark into un-charted waters and in an uncertaineconomic climate. It is a lot of pressureto set the course, make sure that every-one stays on task and have a successfuloutcome each time out. It takes awatchful eye…but that is the challengeand with it the rewards.

Cover Story ~ CONTINUED FROM PAGE 15



At Schroeder So-

lutions in Milwau-

kee, president

Scott Gierhahn

(pictured) prides

himself on his

ability to really understand the wants and

needs of both his clients and his employ-

ees. It’s an approach to the market that’s

paid off handsomely over the past five

years, as reflected in his dealership

being named three times to the Future

50 by the Metropolitan Milwaukee Asso-

ciation of Commerce, its selection as

one of Milwaukee’s Top 10 Businesses

to Work For in 2007 and its nomination

as Best Turnaround of 2008 by Corpo-

rate Report Wisconsin.

Founded in 1988 when Schroeder Mov-

ing became Schroeder Installation Sys-

tems, the company has grown steadily

since then, joining forces with Integrated

Office Solutions, an office furniture deal-

ership, in 2000 and finally becoming

Schroeder Solutions when purchased by

Gierhahn in 2002.

Currently a $9 million organization, the

company continues to hold onto its mov-

ing and installation roots while focusing

on corporate and mid-market office fur-

niture opportunities.

An unaligned dealership dedicated to

Teknion and Global - The Total Office

new furniture, Schroeder’s also offers a

wide variety of used and remanufactured

furnishings, along with design services,

architectural products, relocation serv-

ices, facilities maintenance and window

treatments and corporate artwork.

Because the company came from a mov-

ing background, Gierhahn has continued

Schroeder’s corporate moving and relo-


schroeder solutionsThere is no I in Teamwork

By Alicia Ellis

sc

ott

Gie

rhahn

PICK A PROGRAM THAT FITS YOUR NEEDS AND YOUR BUDGET 310.305.7198 x111

www.gilcargill.com

cations services, with 65-100 employees

working in the field at any given time

and has found success through referrals

and marketing efforts that extolled

Schroeder’s many capabilities.

During the height of the recession, Gier-

hahn developed a facilities maintenance

program which has taken off in the past

year and a half, with more than 160 ac-

counts serviced on a regular basis today.

Redesigning space, reallocation of prod-

ucts, moving, reupholstering, cleaning,

and maintaining current furnishings are

just a few of the offerings.

“We have clients who have formal agree-

ments and some with hourly rates,” said

Gierhahn. “Some are serviced on a reg-

ular basis while others will call with a list

of things to do to assist or act as the fa-

cility manager.”

“We describe ourselves as a full service

interiors company,” said Gierhahn. “We

help design, plan, move, furnish, acces-

sorize, and manage our clients’ facilities

Dealer Profile ~ CONTINUED FROM PAGE 17



http://www.gilcargill.com

and ultimately, have a positive impact on

the quality of our clients’ lives.”

“We pride ourselves on good people

who are dedicated to serving customers

beyond their expectations,” said Gier-

hahn who has recently developed a

team concept to better service cus-

tomers. According to Gierhahn, there

are currently two customer teams made

up of two designers, an inside coordi-

nator and a project manager.

The teams always work together to sup-

port three of the six outside salespeople.

The coordinator is responsible for making

sure that all communications are com-

pleted properly and on time and support

sales’ efforts to ensure satisfaction.

“We listen, we interpret and we make

suggestions based on the client’s prob-

lem,” says Gierhahn. “The team atmos-

phere allows us to draw on contributions

from all levels of the company and gives

every employee the opportunity to

shine.”

“Every employee we have is important

to the success of the company and their

happiness is important to me,” said

Gierhahn who reports great results

through a continuous improvement

process that allows employees to con-

tribute and challenge the way

Schroeder’s serves its staff and clients.

“We are a family here and understand

that a happy work environment breeds

productivity.”

An employee wellness program pro-

vides Gierhahn with a great way to show

his people how much they are trusted

and appreciated for their efforts. Walk-

ing and biking trails behind their building

provide a great place relax, enjoy the

outdoors and socialize.

“Our emphasis is on overall health,”

Gierhahn explained. “We host health

fairs, organize walking contests, offer

healthier food and vitamin water in

vending machines, keep bikes in our

warehouse for anyone’s use and buy

fruit every week for employees.”

And, although there was no company

money to support a workout room, Gier-

hahn gave employees space in the

warehouse and with employee dona-

tions of exercise equipment, videos, and

a few leftover panels, a workout space

was born.

“We always give our employees time to

serve on local charities and participate

in fundraising events,” said Gierhahn

proudly. “We don’t give to get some-

thing in return. When you give just to

give, you get back and that’s exactly

what we’ve created here. In giving,

we’ve gotten back so much more than

we ever imagined.”

Dealer Profile ~ CONTINUED FROM PAGE 18

The purpose of this article is to help you to findand fix hidden sales productivity problems.

First, allow me to present a little bit of history.

The sales process that most office furnituredealers utilize today was first documentedin 1873 by the founder of NCR. His earlysales training manuals exactly parallel theapproaches taken by many office furnituredealer sales representatives.

Unfortunately, 19th-century processes justdon't work in the 21st century. The process,in and of itself, creates many sales produc-tivity problems.

In the following paragraphs, I'll presentthese problems, as well as show you waysin which to remedy them.

n Selling time: Selling time is a precious,non-renewable resource. In business-to-business selling, we have approximately173 hours of available sales time monthly.Any and everything that your processesand procedures do to require some ofthat time, directly and proportionately,reduce the potential of a sales profes-sional to generate incremental revenue.

I know, as I write this, some of you willsay, “But my account executives have todo design work, planning work, etc.”

While I agree that some of that is needed,do you need to have all of that work doneby your sales professionals?

As a rule, you should implement proce-dures that allow your salespeople to selland everyone else to do everything else.

In other words, assign the lowest valuetask to the lowest cost employee, andstart evaluating the cost/value of asalesperson based on the revenue he/shegenerates per sales hour.

n Selling skills: As our industry haschanged, the skills required to generateincremental revenue have not. Conse-quently, at some level, many salesprofessionals are selling utilizing 20th-century techniques.

Spend some time in the field with all ofyour salespeople. Observe how they sell.Confirm that their approach to selling iswhat you want and your customers need.Are they solving problems for yourcustomers or are they just "featurepreachers?"

n Compensation: Take a hard look atyour comp plan. Does it reward differentlyfor new business versus old business? Ifnot, you're on your way to overpaying forunder-performance.

While you're looking at your comp plan,take a hard look at what activities youexpect your sales team to complete inexchange for any salaries or guarantiesthat are components of the comp plan.

In too many companies, the comp planessentially does little more than pay thesalespeople for showing up. In otherwords, no critical activities are required ofthe salesperson in order to earn his/hersalary. I believe that salaries should beattached to certain activities.

n Metrics: This is one of the biggestproblems that office furniture dealersface. Because of selling time, old habitsand overpayment, many dealers allowextraordinary activity levels to persistwithin their organizations.

As soon as possible, take a look throughyour CRM system (you do have one,don't you?) at the calendars of your salesprofessionals. How many first meetingsare scheduled in their calendars?

"First meetings" applies to a phone orface-to-face meeting with a decision-maker or influencer who has the potentialto drive some incremental business intoyour organization.

Failure to monitor this critical metric (firstmeetings) causes unpredictable forecastsand revenue/profit shortfalls. Simplystated, no first meetings this monthmeans no new business from new ac-counts in the near future, unless your luckturns very good.



Finding and Fixing HiddenSales Productivity ProblemsBy Gilbert E. Cargill

“ F I N E A R C H I T E C T U R A L H A R D W A R E F O R Y O U R F I N E F U R N I T U R E ” ®

w w w . m o c k e t t . c o m

For maximum cable passage,

in a

/ ”, / ” / ”

n Market potential: Find a good listbroker and ask him/her to profile yourexisting accounts against the geographicmarket that you target. Most companieshave a very small subset of their marketpotential in their marketing database.

n Account retention: Frequently, we payso much attention to gaining new businessthat we forget to work equally diligently toretain the accounts that have already donebusiness with our organizations.

If that brief description fits your company,I suggest that you very rapidly assemblea formalized account retention process.

This process requires an account planningguide or a similar tool. Without a formalwritten plan to broaden and deepen yourpresence within a significant account, youare essentially hoping that the account willcontinue to do business with you.

It's a flawed strategy at best. Once theaccount plans have been written, makesure that the plans are reviewed and up-dated every 90 days.

If possible, implement a top-to-top man-agement visitation program. This programrequires senior managers from your busi-

ness to meet with your counterparts at yourclient companies. Make sure that these vis-its are strategic in nature and not tactical.

n Inspect that which you expect:Inspect the quality of your proposals,sales presentations and product demon-strations. If you don't see what you'd like,then you should immediately implementa series of sales practice sessions (aka.role playing).

n Web marketing: Review your web-marketing program and make sure thatyou receive a weekly report letting youknow the status of your website.

How many visitors have come to yourwebsite in the previous week? How manyof those visitors left their name, addressand phone number and converted into asuspect? What does your website offerthe visitor in exchange for permission tosend them some email?

In summary, I hope that I've presented a se-ries of ideas that will allow you to identify hid-den sales productivity problems and fix themproactively. The world has changed, and theprocesses that you and your organization un-dergo to find, acquire as well as retain cus-tomers must also change. As always, I wish

you...Good Luck & Good Selling!!

To help you identify sales productivity prob-lems, Gil Cargill has made available throughOFDA’s website, free copies of his Time andTask Analysis Tool and Large Account Plan-ning Guide.

Visit http://www.ofdanet.org/Contributors-to-OFDA-Publications to download.

Gil Cargill has spent the past27 years as a consultant,speaker and trainer helpingthousands of businessesachieve dramatic andpermanent improvements insales productivity. Cargill hastaught salespeople across

diverse industries the importance of developingsales processes, the advantages of implementingnew technology, and the benefits of tracking salesperformance. Gil is a frequent speaker at nationalconventions including OFDA’s Dealer StrategiesConference where he was the keynote in 2009and workshop and session presenter this pastyear. For more information, contact Cargill at

[email protected] or www.gilcargill.com.

Sales Productivity Problems ~ CONTINUED FROM PAGE 20


http://www.ofdanet.org/Contributors-to-OFDA-Publications


http://www.gilcargill.com

Before I answer that question, let’s firststart with what Twitter is: Twitter is a lessgated method of communication: youcan share information with people thatyou wouldn't normally exchange emailor IM messages with, opening up yourcircle of contacts to an ever-growingcommunity of people.

The short format of the tweet (140 char-acters) is a defining characteristic of theservice, allowing informal collaborationand quick information sharing that pro-vides relief from rising email and IM fa-tigue.

This brings us back to the question, is itworth it? Maybe. I know this may not bethe answer you were hoping for, but itreally does depend on how you plan touse Twitter.

With over a 100 million users, it is clearpeople see value in using Twitter, but thereal question comes down to: Do thesepeople want to buy office furniture? Anddo they want tweets about office furni-ture every day? Odds are the answer isno. But that does not mean you shouldnot be on Twitter.

There are other reasons to be active onTwitter. For example:

n It’s a great way to stayinformed. The amount ofinformation sharing and valuablecontent that is near impossible tofind elsewhere makes Twitter agreat resource for keeping you andyour employees fresh on just abouteverything from industry-relatednews to the best new sales quotesfrom Zig Ziglar.

n It’s a great way to network.The strength of Twitter innetworking is that it’s like meetingsomeone at a backyard barbeque,as opposed to a formal businessmeeting or networking luncheon.The informality is a great icebreaker, and it encourages folks tolet their guard down a little.

n It’s a great way to shareexpertise. Twitter allows you toshare your expertise withdesigners, architects, commercialreal estate brokers and more all thetime. So much time is spent goingto networking events to meet thesepeople, but you are not alwaysgiven the opportunity to share yourexpertise at those events. Twittergives you that opportunity multipletimes a day.



TwitterIs It Worth It?

By Jason Kirby

n It’s a great way to roll out promotions. A reallypopular use of Twitter is sending out promotions ornotifying people of big sales. These have to be donecarefully to not come off as spam, but people appreciate agood deal and Twitter is a great way to get the word out.

n It’s a great way to manage your brand. Monitoringwhat your clients are saying about your company andservices is of great value to both you and the client. It issimple to do and is above and beyond typical customerservice.

Now you know why you need to be on Twitter, let’s discusswhat you should tweet about.

Over the last year we have monitored some of the most influ-ential B2B twitter accounts and have determined that thereare five different things you need to be tweeting about.

n News tweets. This is a great opportunity to share atweet or link about something relevant that happened inyour client’s industry or in the A&D community. Yourfollowers will begin to recognize you as a valuableresource and even re-tweet you to their followers (akayour potential new clients).

n Trending Topic tweets. You may have noticed onTwitter Search something called “Trending Topics.”These are the keywords currently being tweeted themost about. They’re either just the word/phrase or ahash-tagged (#) word. The point of using TrendingTopics is that it allows you to reach people who may notbe looking for office furniture, but may still be interestedin your tweet, as your tweet will show up under twittersearch when people look at Trending Topics. Result: youreach people outside your network and also stay currenton trending events other people on Twitter find valuable.

n Personal tweets. The purpose of the personal tweetis to build trust and credibility and present theperson/face behind your Twitter account. Companiesand individuals are much more likely to follow someoneon Twitter they don’t believe is some random spammeror a person who simply re-tweets everything to generatecontent. Think of this as building a relationship with yourfollowers. Show them that you’re real and that you havevalue to give them if they follow you or better yet, dobusiness with you.

n Self promotion tweets. You have to be careful withthese, but they are acceptable and effective when donein moderation. This is your opportunity to tell the worldthat your company is great and can be of value to yourfollowers. If you have a recent success story with aclient, don’t hesitate to share it. If you have any greatimages of product that you have just got in or installed,

be sure to share those too. These are not meant to besales pitches, but they are meant to remind people ofwho your company is and the services you offer. Thishelps your brand stay top-of-mind to potential and pastclients.

n @ & Reply tweets. An “@ Tweet” or “Mention” iswhen you want to direct your tweet to an individualaccount, by putting “@”followed by their name (e.g,@OFMarketer). The benefit of this is that it not only will itshow up on your feed with a link to their page, but moreimportantly, it will appear on their twitter feed with a linkback to your page, effectively tapping into all of theirfollowers who you previously didn’t have direct accessto. This is a great way to communicate to people andstart the conversation. You can tweet a photo of a recentinstallation and use the “@yourclient” so they are notifiedof the photo. This may lead them to replying back abouthow amazing your installation team is or how yourcustomer service is impeccable. Those tweets will thenshow up on your page so other potential clients may seethem.

Ideally, you should aim to send out at least one of each ofthese types of tweets every day. That may seem like a lot forsome of you, but our research has discovered it leads to ahigher number of followers, retweets, mentions and websiteviews.

Now that you have a foundation of why you should be on Twit-ter and what to tweet about, you can engage your customersand partners more frequently and in a more effective way.

See Twitter as the opportunity to stay in contact on a dailybasis with hundreds of people and companies in the time ittakes to make one follow-up call to a client.

Twitter by no means replaces networking face-to-face, but itcertainly does compliment it. It is even better if you are doingit and your competitors are not.

Now is the time to stop complaining about Twitter and starttaking advantage of the new and stronger relationships youwill build.

Jason Kirby is director of the office furnituremarketing program at eBoost Consulting, a digitalmarketing consultancy that has generated inexcess of 20,000 leads for its clients in the officefurniture Industry over the past five years. Jasonwill be hosting a webinar on December 4th on “5Steps to Prepare an Office Furniture Dealer’s 2011Marketing Strategy” You can learn more and

register for this free webinar here www.officefurnituremarketing.com/webinar.html ?utm_source=OFDealer&utm_medium=Twitterarticle&utm_campaign=OFDealer.

Twitter, Is it worth it? ~ CONTINUED FROM PAGE 22


http://www.officefurnituremarketing.com/webinar.html ?utm_source=OFDealer&utm_medium=Twitterarticle&utm_campaign=OFDealer

ofdealer november 2010

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