Count The Cost
Every six months is time to sell fireworks, this is our main business. We count everything coming into the warehouse and everything sent to the locations. Last season we had 48 retail locations and we need a retail operator for each one. Most of them come back for each sale but ten or twelve will be brand new to selling fireworks and they are usually new to any type of business discipline as well. They all do it for extra money and with the economy slow these folks are unusually in need.
Knowing that training and raising their level of knowledge in several aspects is important to them and us making a profit; we schedule an orientation on a Saturday where the new comers can be exposed for the first time to our business system. We teach them how we do things. After twenty years of experience with people who usually don’t manage their personal business I know which ones will do well and those who will not.
You need a bit more background to see what I want to show you with this blog post. When it is time to open for selling we schedule the deliveries in routes. The driver will pull up to the stand to unload and the operator will be there to take the delivery. When all the boxes are out of the truck both will count all the boxes and make record on the invoices and each will sign. The operator will then unpack each box onto the shelves to count all the individual items to verify the original warehouse count. Any discrepancies will be called into the office within twenty-four hours, but if all the boxes where there we expect no mistakes. Sales are made and money collected including sales tax. Whatever fireworks are left at the end of the selling is counted and packed into the original boxes. When the driver arrives to pick up the ending inventory the operator and he count all the boxes before loading and they are returned to the warehouse and stored separately until the time for check out arrives and the operator comes in to pay us, they keep their part. If they manage properly, the cash plus sales tax they bring to our office will equal beginning inventory minus ending inventory and calculating sales tax to that number the two will match. This last season that worked for 42 of the 48 locations, six were short on their money and one actually made nothing plus owing us. No one I know has ever been short who carefully managed the stand. They are almost never over on cash receipts which indicates another problem if they are over.
I have one person who just finished his third season with us and has been cash short each time. I would say his management style is helter-skelter. He always tries to sell grass or Christmas trees etc. for his living but he is always broke. His wife works for Wal-Mart and does know how they do things but it seems they do not apply those practices personally and apparently not to fireworks. This time they had two locations, his and hers about a mile apart and they were several hundred dollars off. They were shifting products as needed between the two spots and said they kept an accurate list. They did not make much, for the third time. I talked to him on the phone about four weeks after we closed and I could tell he was cool toward me. Finally he blurted out at me, “Your computers are all wrong.” What? “Yeah,” he said, “There is no way we could be that short and we did not steal the money and we only had family we trust help us on New Years Eve.”
I explained again how we were only one box short which worked out with the inventory that was checked in, items were missing and about as much as one box would hold. The money he was missing would fill twelve boxes of product on average. He understood this. So finally I asked him how the computers could be wrong on the 42 locations that got the numbers correct. I think he wanted to accuse me of cheating him, others have. He had no way to do so because our business system protects us. I told him I would happily teach them a system to run the stand and control all operations so this did not happen again, no response.
When I hung up the phone I remembered for the fortieth time how people don’t know what resources are required for business. Everyone who works in commerce should know something about business, that knowledge would eliminate much misunderstanding between owners, managers and employees. Most small business people own a “business” that in reality is a job, they have no freedom.
Here is a reality check, the more wealth you create, the more free time you should have.
You need an attitude adjustment if you don’t get this statement. An attitude adjustment is what the person I mentioned earlier needs but he won’t change because he has in his mind assigned blame to me and he is the victim. He is doomed to repeat the same mistakes and he missed the opportunity for me to help him. Running a fireworks stand for us is a wonderful way to get a lesson is management, I can’t vouch for a competitor.
Did you notice the inventory/cash control system as I described it earlier? Its just one element of a whole symphony, one voice you might say. As general manager I oversee each system and control them so they operate in harmony. We have glitches because people make mistakes but there are plans for those contingencies as well. During any season we will have over 200 people selling and serve thousands of customers. Do I accomplish all that? No, the systems do it for me as I oversee them. What makes it all work is training and communication, constantly without ever stopping.
So what is the price to pay? It is the price of education if you want to be above average in your endeavors. Evening hours invested in reading and study of principles important to creating an organization capable of setting you free financially. How long? Forever. When will you be ready to start? When you have become a person who would do those things discovered in study. It is a change of nature and character within speaking and acting on your own authority from what has been imparted to you. Like Jesus did for the twelve.
Attitude is everything. I could always tell when a long time operator was losing interest, when they stopped being thankful. Attitude will determine your approach, one of expectancy for success or trying to get by. Being humble and teachable because no person knows everything, therefore be alert in every circumstance for the voice of the Spirit to lead and reveal.
Business is simple, it is about satisfying needs and wants for everyone involved. Simple, but a very heavy burden if you try to be everything to everyone. The organization you create to do the job of satisfying needs and wants can do so effortlessly.
I will suggest a few books along the way. The first is Rich Dad, Poor Dad. I hope you did not get caught up in the controversy about Rich Dad being a real person or not. Listen to me here, it does not matter, the principles are real and come from a proper perspective. Absorb it and any other books in the Rich Dad series.
The above is for information only and not professional advice. Seek council from those who know your individual situation and financial condition before you risk any money.