22 WESTERN PALLET
One of WPA’s increasingly important value propositions is its online events. Each month in 2023, the Association plans to offer a Master Learning Group sessions or a quarterly webinars. February’s memorable event featured business strategy consultant Guy Gruenberg of Grow Consultants and until recently, President and Chief Strategic Office of Rose Pallet.
Through his consulting business, he specializes in helping companies increase their profits, develop raving fans for clients, implement strategic planning initiatives, and take advantage of industry-specific opportunities. Many Western Pallet Magazine readers will be familiar with reports on Guy’s presentations from previous WPA online events and the WPA Annual Meeting.
Guy's presentation was sparked by uncertainty in the industry. “I don't have a crystal ball,” he said, “but I do pay attention to things maybe in a different way.” He emphasized that this was designed to be a participant-driven presentation, and he was interested in hearing key challenges attendees face. These would form the basis for the second half of his presentation, scheduled for March 23. (Watch for a report on Pivot Part 2 in the April edition of Western Pallet.)
While there is currently heightened anxiety about uncertainty in the market, Guy observed that from his perspective, the world has always been uncertain. He observed that while earthquakes or tragedies in another part of the world may make us feel sad, they are not in our backyard. In the last few years, however, we have experienced some painfully impacting experiences.
“Running a business is intense,” he said. He described the three parts of running a business as everyday business, handling everyday crises, and then strategy. Strategy, involving making timely moves and making the right moves is critical.
To put things in perspective, he emphasized that the pallet industry is still very young, citing the first wooden pallet patent in 1925, the Commonwealth Handling Equipment Pool (CHEP) being sold to Brambles in 1949, the start of the Internet in 1983, and so on. There has always been disruption, and it will continue to be a factor for businesses.
Disruption, Guy noted, is just part of life. He had planned to do the webinar from his office in Milwaukee, but then a storm hit, and the electrical power was out. As a result, he had to drive 100 miles to another one of his houses that had electricity to deliver the webinar. “That’s how I had to deal with the disruption,” he said
Pivot, the topic of his webinar, pertains to how companies can change or adapt in the face of new challenges and opportunities. While SWOT analysis is a more detailed strategic approach, Guy proposed that companies or individuals can start with a simple five-step approach: Stop, Notice, Consider, Choose, and Act.
“Stopping means that you have to pause and you're pausing so that you can notice,” he said. “We haven this pressure always of trucks in the dock making shipments, shifting orders, cutting lumber, equipment breakdowns. It’s really hard to have an awareness when you have all these distractions around you.”
Guy noted that his calendar is planned out for the next several months and that it is really hard, sometimes, to stop and notice things. “My wife laughs at me sometimes because I don't see the garbage can overflowing. And I walk right past it.”
Some of the challenges he has seen are companies working through higher-priced inventories of cores or lumber. One thing that Guy mentioned is to be very proactive on the sales side. Have conversations with customers. Rather than waiting for the customer to ask for a price decrease, explain that with falling costs, you can offer them some degree of a decrease. As you work through higher-priced inventory, you might be able to offer further price concessions. Being on the phone with them is super important, he said. It is an approach that can help instill loyalty.
“Don't let somebody leave you without knowing about it,” he continued. “That's a painful experience when suddenly someone calls you to pick up a trailer. Boy, that doesn't feel good. So what do you do to avoid that? That's not solving a problem, that's preventing a problem.” A key to preventing such problems is having a well-trained sales force.
He encouraged attendees to make a list of what is working and what is not working. One mistake Guy has seen is complacency about customer selection when things are going well. “Were are you choosing accounts that were good for your company?” he asked. “II'd like you to think about that. I'd like you to think about if you were to do an assessment of your clients, how much do they buy from you? Are they loyal to you? Do they only buy from you? Do they buy from more than one supplier? Do they pay their bills on time? There are five or six criteria you can use to rate customers.”
The role of the owner-manager, he emphasized, is to move the company in the right direction. Cost control and sound financial management are critical. For example, Rose Pallet, his former company, always reevaluates costs, even on things like garbage or the exterminator, looking for opportunities to economize. It doesn't seem like a lot, but $20 a month here and $50 a month there, at the end of the day, it adds up.”
Another area of opportunity for companies can be going after different product markets. As a result of the nail shortage and spiraling prices, decided to go into the nail business. A recycling company has made a considerable investment in new pallet equipment. He encouraged companies to explore potentially underserved opportunities such as custom new pallets and wood packaging. They might seem like a headache but ultimately might be more profitable.
Another crucial area is knowing your costs to help inform pricing. “Pricing is actually pretty simple,” Guy said. “It's direct costs, material labor equipment, then you have an overhead component that gets you to your breakeven, and then you have to put something in there for profit. What data should you keep?
“I cannot tell you how many people I talk to,” he continued. “I may walk in their yard. And they have stacks and stacks and stacks of lumber, but they don't have any idea what the value of it is. They don't really even know their current inventory. They just kept on buying lumber because they were worried about not getting it.”
These were just some of the many valuable insights from Part 1 of Guy’s Pivot presentation. We will provide coverage of Part 2 in the April issue. To get full value, consider attending WPA’s online webinars and Master Learning Groups live via Zoom. To learn more, visit www.westernpallet.org/
WPA Webinar Series: Guy Gruenberg, Pivot Part 1