TOP
STORIES
 1 of 5
Mission Critical 411 on Control Room Integration
Integrators with long histories in this space discuss how projects and customer demands are different than others.
 2 of 5
How Boston College Gets Fans off Comfy Couches, onto Metal Benches
Boston College installs new Daktronics 13HD LED video boards at Alumni Stadium to draw fans to the in-game experience.
 3 of 5
Top 10 Dante-Enabled Products
Check out 10 key products that have received the increasingly important Dante touch.
 4 of 5
An AV Guy's Guide to Talking IT
This quick glossary of IT terms will at least help AV integrators demonstrate some basic network knowledge when speaking to their clients' CIOs and IT directors.
 5 of 5
Inside Look: Long Island Railroad's Command Center Unveiled
IntraLogic Solutions outfits area’s largest railway with video wall and 4D GIS mapping solution.
5 Simple Steps to Improve Profits in 2013
Let’s focus on the little things to make sure the profits that drive our businesses are big.

Article


Tightening up accounting and communications practices will help your company run more smoothly and more profitably.
January 04, 2013 | by Daniel L. Newman

Every year brings new opportunities as well as new challenges. That is especially true given the nature of the integration business, which is dependent on construction and cap-ex investment to continue to grow our top lines.

While growing that prestigious top line number is sexy and certainly important for those trying to improve their top-50 statuses, it pales in comparison to that bottom line number that funds payroll, investment and continued operations. Unfortunately, for a number of reasons there are no lists of top-50 bottom line performers.

Improving the bottom line requires healthy sales blended with well-run finances and operations. While this may sound simple enough, it isn’t always so easy. The little things can make the difference between profits and problems. So this year, let’s focus on the little things to make sure the profits that drive our businesses are big.

Here are five everyday items we should all work to do a little bit better in 2013.

Margin Management
Many CIs allow their sales personnel to handle quoting. This in itself is OK, but many sales personnel tend to use straight margins across all product subsets. Make sure items such as accessories, racks and audio equipment – items that customers tend to shop less aggressively – are given appropriate margins to offset the erosion that is taking place with products such as projectors and video-conferencing gear.

Purchasing
As an extension of margin management, it is important to treat purchasing as a key to your profitability. Many of the larger integrators have figured this out, but it has remained a problem for smaller CIs. This is due in part to the investment that has to be put into purchasing management. If careful purchasing management can yield 1, 2 or even as much as 5 percent improvement to cost of goods, it can become a profit center, and those percentages are very attainable.

Accounting for All Costs
While CIs generally have a good understanding of hard project costs like labor, far too many integrators don’t consider the soft costs of running a business. Known as a G&A (general & administrative) cost, many integrators don’t charge for this (whether buried or as a line item). This is because many integrators have difficulty explaining it or just completely overlook it. But costs like these add up and can be worth as much as 10 percent of a project’s worth.

Service Attachment
Let’s make 2013 the year to find ways to incorporate service into every project. Think about how much more profitable your business can be if just 10 percent of your total revenue is backfilled by high margin services.

Clear Communication
This one is a “big” item that is wrapped up in little ones. I call it “Management Osmosis” where managers think that through some form of telepathy or osmosis, employees know what their management wants from them. This year, make sure to use the many available forms of communication to let your employees know exactly what it is you want for them to know. It amazes me how often employees don’t feel they clearly understand a company’s vision, mission or even their marching orders. If you improve this, everything else will follow.

The little things may not be exciting for executives, but they are key components to a business’s success and profitability. Pay attention to them and reap the benefits of a better bottom line. Perhaps more importantly, doing the small things well will allow you to seize the opportunity to focus on planning for what is next.

About the author

Daniel Newman is the founder of BroadSuite Consulting (link digital to www.broadsuite.com), a specialized consulting firm that focuses on helping brands and businesses to be found, seen and heard online. Prior to finding BroadSuite, Newman spent his entire career in various integration industry roles including CEO of United Visual, a 60-plus-year-old commercial integrator. Part-time MBA instructor, he's also a contributing writer for Huffington Post, SAP and IBM.
View all posts by Daniel L. Newman
Social Bookmark or Share This
  • Facebook
  • Twitter
  • Digg
  • Del.icio.us
  • Yahoo! Bookmarks
  • Google Bookmarks
  • StumbleUpon
  • Technorati
  • Reddit
  • Windows Live
  • LinkedIn
  • Evernote
  • E-mail


  • Latest
  • Blogs
  • Photos
  • Resources
An AV Guy's Guide to Talking IT

By no means a thorough resource, more of cheat-sheet, this quick glossary of IT terms will at least help AV integrators demonstrate some basic network knowledge when speaking to their clients' CIOs and IT directors.

What Are You Thinking… Seeking RMR From Yesteryear’s Trends?
5 Strategies for Selling and Renewing Service Plans
Getting Over That Growth Hump: 5 Questions to Ask Yourself
Are Tech-Trained Millennials the Right Hire for AV Integrators?
View more blog posts
White Paper:
Campuses Banking on Emergency Notification, Upgrades

A survey from CI sister publication Campus Safety shows that one in two campus protection professionals say their institutions plan on or are considering deploying new/upgraded emergency alert solutions in the next year.

Webcast: Unscrambling Your AVB, HDBaseT Questions
White Paper: Technology Brief on Control Rooms
White Paper: The Voice: How to Design Emergency Communication Systems with Announcements
White Paper: Digital Signs of the Times
White Paper: A Snapshot of the Onsite Freelance & Contractor Workforce
Webcast: 7 Ways an Integrator Can Save Clients Money on Utility Costs
White Paper: 3 Dazzling LED Panel Implementations
View more papers or webcasts



Recent comments

Thanks for your comment, Alan. I understand and appreciate your frustration about the pictures and belief…

Posted by D. Craig MacCormack on 2014 10 14 · commented on
'Inside Look: Long Island Railroad's Hiperwall Command Center Unveiled'.

Too bad the pictures only show a promo of IntraLogic and no real or simulated picture of what was used during…

Posted by Alan M Hoffberg on 2014 10 14 · commented on
'Inside Look: Long Island Railroad's Hiperwall Command Center Unveiled'.

Benson - nicely done.  This is a trend in some of the smarter integrators in AV, but needs the kind of…

Posted by dave fahrbach on 2014 10 10 · commented on
'5 Strategies for Selling and Renewing Service Plans'.

For sure it’s not always better! Maybe just selling better!

Posted by Argis on 2014 10 06 · commented on
'Getting Over That Growth Hump: 5 Questions to Ask Yourself'.