Lindsey Grant

Sunday, 12 February 2006 19:00

Joining forces

When Tracy Bilbrough became president and CEO of Juno Lighting in 2000, his task was simple: Grow the company.

Bilbrough had a reputation for growing companies, and the private equity firm that owned 70 percent of Juno Lighting was looking for someone who could take the company to the next level. Under his leadership, Juno grew steadily, but the constant threat of the sale of the company loomed over the heads of Bilbrough, his employees and his customers.

“Private equity investments almost always have a limited timeframe,” says Bilbrough. “(They) generally resell a company that they buy to give liquidity back to their investors. So it was inevitable from the time I joined the company that eventually there would be a sale of the company. It was really a matter of deciding when was the right time.”

The right time turned out to be the summer of 2005. The right buyer was Schneider Electric.

Despite the acquisition, Juno has maintained its individual identity while reaping the benefits of its $13 billion parent company.

Smart Business spoke with Bilbrough about the acquisition process and how being acquired has benefited the company.

How did you know it was the right time to sell Juno?
We had generated enormous sales growth, as well as profit growth, over the last three or four years. The company was doing extremely well.

The current shareholders were going to receive a lot of rewards, in the sense that the company had really grown both sales and profits and we had taken a lot of market share. The board could see that there was still a lot of runway left in that.

We weren’t necessarily talking about selling the company at some peak that wasn’t sustainable. In fact, the board concluded that it looked like we would have several more years of that kind of growth. To a buyer, that is attractive. Ideally, if you want to get maximum value for your exiting shareholders, you want to sell the company at a time when new buyers can still see the good times continuing.

Our industry had been doing well for the past few years, but looked like it had a lot of upside left in it. The lighting industry went through a bit of a downturn after the 9/11 attacks. Commercial construction really went into a slump.

More than half of our business comes from the commercial construction side of things. The other slightly less than half comes from residential construction. The lighting industry looked like the residential market would stay relatively healthy, and the commercial construction market looked like it was coming out of a trough and [would] be good for the next five years or more.

The final factor was that the market for selling companies in 2005 was as hot as it has been in a long time. There were more buyers chasing good companies than there were good companies to buy. If your board looks at those three scenarios, that is about as good a time to sell the company as you could ever see.

How did you choose the right buyer?
We could have sold the private equity firm’s stake back to the public and gone back to being a fully publicly traded company, or we could sell to a strategic buyer, like Schneider Electric was, or we could sell to another financial buyer, which is what private equity firms are referred to.

We pretty much did an open auction of the company. Our board hired an investment banking firm and they put a marketing plan together and took the company’s story out to financial buyers [and] to strategic buyers who might be interested. The investment bank also reviewed the option of selling the company to the public and decided that the opportunity would always exist if the other avenues didn’t pan out to our shareholders’ satisfaction, but there seemed to be a lot of demand for Juno among strategic buyers and financial buyers.

Many people were interested, and we received many attractive offers for the company. Because we had a publicly traded stub of ownership, we were bound by all the FCC and NASDAQ regulations.

There’s a set of rules and laws that are referred to as the Revlon Duties of a board. The Revlon Duties of a publicly traded board are they have to sell the company to the highest bidder, no matter what. Schneider Electric was the highest bidder for the company.

How has being acquired benefited Juno Lighting?
The fact that somebody owns us, other than the private equity firm, is beneficial because all of our employees have known all along that because we were controlled by a private equity firm, the company would eventually be sold. Not only did all of our employees know that, but all of our customers knew that, all of our suppliers knew that, and that always left an air of uncertainty around the company.

We did terrific despite that, but when we were trying to recruit new people, one of their concerns always was ‘Well, this is fine now, but we know you are going to be sold, and I don’t know who the new buyer is going to be, and therefore, I don’t know who I am going to be working for.’

And our current employees were always worried about what was going to happen when the company sold, and our customers would always worry a little bit.

One good thing about this happening is it eliminated all of that uncertainty. Now our employees know who they work for and who they are going to be working for. Our customers know who we are owned by and that we are not going to change hands again.

Schneider is a very attractive purchaser to our customers because they are so highly thought of worldwide. They are a major worldwide company — over $13 billion in sales. Their biggest business in the U.S. is Square D, which, in the electrical industry, is a very famous brand and a very large business.

There are real synergies between us and Schneider Electric because of the fact that their whole business is electrical products and all of their products are sold through the same channels and distribution that we sell through. We are now part of a much bigger force within our distribution channels and a much bigger force within the electrical products industry.

That makes us more important to our customers.

HOW TO REACH: Juno Lighting, www.junolighting.com

Wednesday, 28 December 2005 05:17

Clinical Integration

With medical and pharmacy costs continuing to rise, the focus on the cost of employee health benefits is understandable.

But increasingly, sophisticated employers and their advisers are looking beyond line item costs, and concentrating on improved employee health, absence, disability and presenteeism outcomes.

By analyzing available information across a spectrum of benefit products and services — medical, disability, behavioral and pharmacy — a health benefits carrier can see the individual member as a whole. This is known as clinical integration.

“Clinical integration allows us to have an opportunity to use clinical information to identify people who are most at risk from health conditions,” says Mark Hanrahan, vice president of sales and service for the Aetna’s north central west region.

Smart Business spoke with Hanrahan about how clinical integration can help employers get the most from their health care benefits investments.

How does clinical integration work?
Medical, prescription, dental and other available information is integrated in one place in order to assess intervention opportunities to improve enrollees’ health, which may prevent or mitigate work absence. The various disciplines — primary care physicians, behavioral health experts, pharmacists, disease management and disability management staff — all work in concert to create the opportunity for better health outcomes as well as provide enrollees with a more coordinated experience.

It’s looking at a person’s health care needs as a whole rather than looking at their health problems in ‘silos.’

How can clinical integration increase the total value of investments in health benefits?
There are four essential components of a clinical integration offering. The first is the integration of health and productivity data. For example, a health plan will look at its member data to try to identify those who may need intervention by a case manager.

The second is a proactive engagement process. That is, if you have both health and disability management data available, you can initiate an outreach to those members who could benefit from risk-reducing programs.

This leads to a third component which is integrated care management. That could include identifying physician-prescribed individual care plans and tracking the member’s progress under that plan. And the last component is to measure your progress.

Can you explain how looking at a person as a whole may positively impact their health?
Your primary care physician understands that all aspects of your health — physical, dental and behavioral — are intricately connected. Medical science verifies those connections and explains them more fully every day. We know enough to appreciate that medical care should be approached holistically.

But even though a whole-person approach to care makes perfect sense, it’s not always easy to achieve, in part because of the way our medical system works, and in part because of the way most benefit plans are designed. Through clinical integration, which connects a member’s health data, evidence-based medicine and a health plan’s clinical expertise across product lines, a health insurer can bridge together pertinent details about member health, and act to see that those needs are addressed.

By integrating health benefits data, do employers benefit from healthier employees?
We have found that there is evidence that supports a direct correlation between health and productivity outcomes. For example, in an analysis of 50,000 member with fully-integrated medical, pharmacy and disease-management benefits, integrated plan members experienced:

  • 35 percent fewer ER visits for asthma, diabetes and heart failure

  • 34 percent fewer hospital administrations for asthma, diabetes and heart failure

  • 15 percent lower medical costs for asthma, diabetes and heart failure

  • 25 percent more people were identified as possibly having a disease — 33 days earlier than with stand-alone products

What do employers need to know in order to maximize the value of integration?
Employers should ask their health carrier about whether they have ready and timely access to data, and how this data is being integrated with their programs and services. They should also ask about how information flows within the organization and how people work together throughout the organization to deliver services.

At the same time, employers should educate and encourage employees to participate in the disease prevention programs and maximize the services that are available from their health plan.

Mark Hanrahan is vice president of sales and service for Aetna’s north central west region. Reach him at (312) 928-3104 or HanrahanM@aetna.com.

Tuesday, 27 December 2005 08:39

Switching gears

Many people change careers, but making the switch from a professional racecar driver to CEO of a marketing company is quite a leap. However, that is exactly what Zak Brown did when he left racecar driving to start Just Marketing in 1994.

“There are actually a lot of similarities,” says Brown. “You always have to be pushing the envelope and trying to go faster every day, whether you are in a racecar or with a growing business. The mentality to me has been fairly similar.”

It doesn’t hurt that Just Marketing focuses on serving the motorsports industry, something Brown knows a lot about, and that decision has helped him succeed. Just Marketing has experienced an 849 percent growth rate over the past three years, and Brown is finding that more and more clients are seeking him out, rather than vice versa.

Smart Business spoke with Brown about the challenges of starting his own business and the public scrutiny his company faces as it grows.

How did you make the switch from racecar driver to CEO of Just Marketing?
I started the company out of my right pocket, which I didn’t have much in at the time. Getting something off the ground without any investors is a challenge. I never had any investors or partners.

Also, in the early days, you lack credibility, so the combination of the two makes it very difficult to get started. Those first two years were difficult, but probably no more difficult than anyone else starting a company who has a vision who doesn’t really have the resources to start the company.

I started the company as a one-man band out of my house and just kind of plowed away at it. Now we are up to 60 people and are building our own building and have definitely turned the corner. We don’t have any cash problems and don’t have any credibility problems.

Life is still not as easy as I would like it to be, but those two particular start-up issues are no longer issues.

How has focusing on the niche of motorsports helped you grow?
It’s a fairly big industry, so even though we are a niche agency, we are a niche agency in probably the most successful commercial sport. We are playing in the right sandbox, which helps because we are only going to be as successful as the industry as a whole.

Fortunately, the industry has been very sound for the last 10 years and appears to still be sound for the next five years.

How have you managed to grow so quickly in the last three years?
In general, we’ve been focused, we remain focused and we remain very hungry. Our successes have brought on other success. People have definitely taken notice of us. What makes us grow is our success and focus, and hopefully that will continue.

We have never lost an account, which is critical. As we get bigger, we are put up on a pedestal, which means people are gunning for us.

You could make a mistake under the radar 10 years ago and no one would notice because no one really noticed you in the first place. Now everyone is looking, and the competitors would love to see us make some mistakes.

We have to be more critical of ourselves because we are evaluated and scrutinized in a heavier way.

How are you safeguarding against making mistakes?
I’ve hired an executive team over the last couple years. I have brought in some more executive management. We’ve put a lot more checks and balances in place.

Now we kind of have big-company syndrome in that we have to play by all the big-company rules, which takes a little bit of the fun out of it because we began to get involved with some red tape. I want to try to keep our nimble and fun-loving atmosphere of 60 people and not turn into big corporate mentality.

I want to continue to grow. I am very happy where we are at but am pretty motivated and always looking for the next challenge. I am not going to put any limits on how big or small it can get. There are definitely days when I would love for it to be five people because the management of 60 can be a challenge.

I don’t think I want to artificially say, ‘This is how big I want to get it.’ I would like it to be more profitable, but that will come.

HOW TO REACH: Just Marketing, (317) 870-9922 or www.justmarketing.com

Tuesday, 27 December 2005 06:13

Building its reputation

Many entrepreneurs start businesses because they think they can improve something in their industry.

That was the case for Michael Vasbinder, founder and president of Dublin-based ConTrak Corp., who started his own construction services firm in 1988 because he thought he could provide better customer service than existing firms did. He also saw a demand for a single, centralized source for organizing and managing complex construction projects.

“I had reached a point in my career where I wanted to manage,” says Vasbinder. “I also saw a need in Central Ohio to try to do the construction process a little differently as far as trying to have more customer service and more emphasis on satisfying the needs of the client.”

Vasbinder’s idea paid off. His customers are happy, his business is growing and in 2002, he won the Integrity Award from the Central Ohio Better Business Bureau. All of this success has only motivated Vasbinder to continue to excel in customer service. In fact, he measures ConTrak’s success by the amount of repeat and referral business it receives, not the amount of sales.

Smart Business spoke with Vasbinder about how he delivers great customer service and runs ConTrak with integrity.

How do you ensure that your customers have a great experience working with your company?
The key element is communication. If you can keep your clients completely informed as to the progress of the project, as well as the cost and status of the project, you have gone a long way to keep him satisfied.

The hardest thing in the world is to walk up to someone who has no clue about the construction business and ask him to trust you and let you spend $1 million of his money. That’s a difficult hurdle to get past at times.

We try to build upon the projects we did in the past and show the client that if we tell you this is the cost and if we tell you this is the schedule, then, barring an unforeseen circumstance happening, we are going to hit the schedule and we are going to hit the budget and you are going to be a part of this process through the whole construction.

How does integrity influence your everyday business decisions?
We are one of the few construction services firms in town that works completely open book with a client. They have the complete ability to look at our accounting, look at our trade contract, subcontract agreement, look at how we pay our trade contractors. We can even go now to the level of detail that they can see copies of all of our invoices.

We don’t ever want someone to think that we are trying to hide something from them because we don’t need to. We are going to make a fair profit on the project, and that is what you need to do to stay in business. I think by having that kind of mindset, our business just maintains that integrity level.

Our business philosophy is very simple. We just do what is right — for the clients, for the vendors and suppliers, and for the community at large. It sounds trite, I know, but it’s real simple.

How do you keep the focus on great customer service as you grow?
It becomes more difficult. Finding very good people is the challenge in everybody’s business, and it’s the same challenge that we have in our business. We try very hard to recruit who we believe is the correct individual who will fit in our organization.

Our company is very team-oriented, so we look for a team player. We are not looking for someone who has a huge ego who wants to be on top of the world. They need to be an integral part of the team. Most of my employees and associates have been with me for over eight years, so we have a good longevity of people within the organization.

When bringing people onboard, we try to do it through a networking process where we go out into the marketplace and get referrals from people on candidates who they believe are good candidates. We have run ads in the newspaper, but that’s not that successful for us. The networking system has worked better.

Who do you ask for referrals on potential employees?
Absolutely, we ask clients. Also, our trade contractors work for multiple other construction services firms in Central Ohio, so they also have the ability to see and know other people in the industry.

If we have a good network of trade contractors, we contact them and say, ‘We are looking for this type of individual. If you hear of someone or know of someone who is looking or has the desire to move up or on, have them contact us.’ It has worked well for us to date.

Do you provide training?
Yes, we do. We’re a member of the Builders Exchange in Central Ohio, and they are a wonderful organization and have a lot of classes that we send people to that help with some of the training. Some of the software that we utilize has software classes that we send people to, which gets them up to speed.

I have an assistant superintendent right now who is going to Columbus State to get his degree in construction management. We have an incentive program that, if he maintains a certain grade point average, we will assist with tuition.

We like to grow from within. If we see someone who has the desire, intent and ability to move up, then we are going to help them any way we can.

You recently opened an office in Florida. Do you plan to open offices in other states as well?
That is not our intention at this time. We intend to continue growing, but we are going to grow at a controlled pace because we do not want to lose the customer service.

We plan on controlling our growth by being selective with the projects and clients we partner with. Trying to be all things to all people is not part of our business plan. Our goal is to provide our clients cost-effective, excellent construction services.

All associates at ConTrak work collectively as a team. This enables us to increase our workload to service our clients while actively pursuing new associates to assist in our growth. In this way, we are able to hire the most knowledgeable and competent associates in a controlled, not reactive manner.

HOW TO REACH: ConTrak Corp., (614) 766-9990 or www.contrakcorp.com

Tuesday, 27 December 2005 05:45

Building a better brand

Thomas Sullivan believes that in order to have a great work environment, all of your employees must be on the same page in terms of what they need to do to be successful.

To do this, Sullivan, managing principal at Greeley and Hansen, embarked on an experiment to create a new brand for his environmental engineering firm.

“The most important part of this was for our own people to feel that they understand the brand,” says Sullivan. “Once they understand it, then they are the brand.”

Sullivan enlisted the help of GolinHarris, a public relations firm with experience in rebranding exercises, to help his employees with the process. After more than a year of hard work, Greeley and Hansen has a new brand and a new logo to go with it. But Sullivan realizes that rebranding is an ongoing task and the process will never be completely finished.

Smart Business spoke with Sullivan about how he rebranded Greeley and Hansen and how he plans to maintain this brand in the future.

Why did you decide to rebrand your company?
It was my belief that it was important that everyone in the firm understand the values which are necessary to be successful and service Greeley and Hansen’s clients. In discussing this with our human resources director, we came to the conclusion that rebranding gave us the opportunity to get into an exercise where people could rediscover which behaviors on everyone’s part would encompass those values that we think are important.

How did you do it?
The process took a lot of time, a lot of effort and a lot of perseverance, especially in an engineering company. This is something that our people don’t have a lot of exposure to. They are very technical and very scientific, but not very marketing-savvy. We had to teach them about branding and we had to teach them about the benefits to branding and convince them that there really would be a benefit to this.

We began this entire process with the principals of the firm. We employed a facilitator who was very experienced in branding. That was necessary because, with our particular crew of people, they were very skeptical about this. The workshop was carefully prepared. We brought them along slowly and it ended up very successful.

The next thing we did, once we had the principals behind the effort, was form an image committee. That was selected from people across the United States —we have 16 offices. What we wanted to do was get people who were representative of different types of positions in the firm and different perspectives.

One of the next steps was to conduct a firmwide poll. We asked everyone in the company two questions: What does Greeley and Hansen mean to you? What do you think that Greeley and Hansen means to our clients?

Did everyone respond similarly?
Ultimately, the answers were similar, but one of the things that you learn as you go through this is everyone has their own language and everyone has their own way of putting it. If you have Employee A giving you one statement, they will use one set of terms, and Employee B will use something else.

They ultimately mean the same thing, but if they were listening to one another they wouldn’t think so.

We’ve been in business since 1914 and we’ve been doing the same line of work since then and most of our people have been here a long time. They know what it is that makes the company successful. We had to get them to realize that they agreed with one another.

How did you do that?
Talking about it and going over it and explaining to them how, in some cases, what Employee A was saying really was the same as Employee B. It took a lot of time and patience, and a lot of listening.

You have to listen to them and find out what they mean by what they’re saying. Keep driving back further and further until they understand what the basic part of that is.

What effect has the rebranding had on the company?
We are still in the process of this. Initially, there was a pretty good burst of energy from it. We were using professionals to help us do it — the people from GolinHarris. They have done this dozens and dozens of times with people.

What we ended up with from the first part of the branding was a list of descriptive phrases that stated what those valued behaviors were that we felt, if people emulated these, they would be successful in conducting Greeley and Hansen’s business.

Then we went on to our next step. We created a logo. We were really doing that in response to a request from a substantial number of employees who were looking around and saying ‘Gee, everyone else has a logo.’

All that we had was a name logo that said ‘Greeley and Hansen’ in a certain type face. So we embarked on developing a pictorial logo. We developed a lot of alternatives and then got a small group to cut that list down. Then we went to the principals and showed it to them.

We did some modifications and ultimately, by putting a little bit of what everybody wanted in there, we were able to come up with something that we felt would remind us of what our value statement was and remind our clients what our business is.

What does the logo stand for?
It is a box with wave forms in it. In the sense of reminding our clients what we do — projects that are involved with portable water and waste water — the box is supposed to remind one of water.

There are a lot of different wave forms in there and it is supposed to remind staff that everyone is a little bit different, but we are all working within the same context and that from time frame to time frame, we are going to need to change our styles, but our basic principal values are going to remain the same.

How do you plan to maintain your new brand?
We are doing a series of workshops in each office, which we call ‘living the brand.’ GolinHarris had a representative there to lead this for us.

What they and we did was design workshops that are interactive. They include some education, but mainly there are exercises that we have the staff go through, which is intended to reinforce with them the values behind the brand and the behaviors that are expected from them.

HOW TO REACH: Greeley and Hansen, www.greeley-hansen.com

Daniel G. Jacobs contributed to this article.

Friday, 02 December 2005 04:24

Family ties

When most people think of family-owned businesses, they think of small mom-and-pop stores. But family-owned businesses actually have a huge impact on the economy, create many jobs and are often large corporations.

J. Richard Emens and Beatrice Wolper, attorneys from Chester, Willcox & Saxbe LLP, saw a need for an organization to provide guidance and assistance to family businesses in Central Ohio. In 1998, Emens, Wolper, Carol McGuire and T. Michael McGuire formed the Family Business Center of Central Ohio to advise family-owned businesses on the issues and challenges that are unique to them.

According to the Family Firm Institute, 62 percent of the United States work force is employed by family-owned businesses, and family firms comprise 80 percent to 90 percent of all business enterprises in North America.

“Family-owned businesses are the major growth engine of the entire U.S. economy,” says Emens, executive director of the Family Business Center of Central Ohio and coauthor of “Family Business Basics: The Guide to Family Business Financial Success.” “This has been shown to be true in a number of reports.”

Despite the considerable impact that family-owned businesses have on the economy, the Family Firm Institute estimates that only 12 percent will survive into the third generation and just 3 percent will survive into the fourth generation and beyond.

That is where the Family Business Center comes in. The organization offers a way for family-owned businesses to network with one another and share stories and techniques. It also brings in speakers, hosts six roundtable discussions each year and offers an Entrepreneurship and Family Business course taught by Emens and Wolper at Ohio Dominican University.

Smart Business spoke with Emens about the challenges family-owned businesses face and why these businesses are so important to the economy.

How did the idea for a family business center come about?
We met several people who were involved with family business centers on other university campuses and we got excited about what they were doing in the way of education of family businesses. This was probably 10 years ago. It seemed like such a great concept.

There are over 100 family business centers on college and university campuses around the country. Ten years ago, there were only about half that many. The idea has caught on, and family businesses have responded.

How are family-owned businesses different from other businesses?
The key issues in family-owned businesses that are unique involve succession of ownership, succession of leadership, compensation and communication. Someone looking at this who is not familiar with family businesses would say, ‘These are the same issues that occur in every business.’

But when you have the family relationships and you focus on the differing characteristics, then it becomes apparent why the family dynamics are so important to understand in family businesses.

What are those family dynamics?
If it’s a non-family business, the characteristics are profit-motivated. Accomplishments and achievement are the most important. They focus on commerce. They are forward-looking and take advantage of opportunity.

In a family business, you have love as a motivation. You have taking care of the family (as a motivation). There’s a focus on feelings and there’s often a resistance to change.

One of the very important questions that we try to highlight for family businesses is, ‘Are you in this to make a profit or to take care of the family?’ It’s interesting how many family businesses have not sorted that out. Unless the business is primarily to make a profit, then over time, it probably won’t be successful because of all the competition from the nonfamily businesses who are just out there to make a profit.

If you can focus on these issues and recognize them, then family businesses can be very successful because they have that added plus of loyalty and true caring. The key to success in family businesses is emphasizing that loyalty and caring, all the while being profit-motivated.

How do family-owned businesses influence the economy?
Family businesses are the backbone of the economy. The latest numbers that I have seen show that 90 percent of all of the companies in the United States are family controlled or operated, including a third of the Fortune 500 companies. Family-owned businesses generate approximately 40 percent of the gross national product of the United States.

I saw an article just the other day that (in) the five years leading up to 2004, Fortune 500 companies lost over 5 million employees, but family businesses and the other non-Fortune 500 companies created 34 million jobs.

Most of the new jobs that are being created are created by family-owned businesses.

How has the Family Business Center made a difference to family-owned businesses?
All of the family businesses that we work with are very smart people. They wouldn’t keep coming back year after year if they weren’t receiving a benefit.

We also have seen a number of family businesses face serious issues, and when these (issues) have been discussed at the Family Business Center with other family businesses, we have seen the successful resolution of these problems.

HOW TO REACH: Family Business Center of Central Ohio, www.familybusinesscenter.com

Wednesday, 23 November 2005 06:20

Customer satisfaction

There’s an old saying that you shouldn’t mix business with pleasure, but the three owners of Perpetual Technologies Inc. have proven that old saying isn’t always true. Ryan Stephens, Ronald Plew and Chris Zeis have been friends for almost 15 years, and they also run a successful, fast-growing business together.

In 1997, Stephens and Plew founded Perpetual Technologies, a provider of on-site and remote information system services. Although the company made less than $1,000 that first year, by 2000, it was worth more than $1 million. And this year, the founders expect it to reach $6 million in revenue.

Stephens, president and CEO of Perpetual Technologies, says that even as it grows quickly, that growth must be controlled.

“We have always tried to grow at a very controlled rate,” says Stephens. “You have to be careful and control your quality as you grow. We’re fortunate in that we’ve grown very quick and been able to handle that.”

Smart Business spoke with Stephens about his company’s rapid growth and why customer service is so important.

How has Perpetual Technologies been able to grow so rapidly?
Being a technology company, the first thing you have to do is know technology and stay current with technology. If you don’t stay current with technology, you fall way behind the curve and you can’t provide proper support to clients and you can’t help them streamline their business with technology. That’s what we’ve always specialized in is streamlining businesses with technology and empowering businesses through data management.

The other thing is customer service. Most companies say that they have excellent customer service. But how many companies actually follow through on that? How many companies actually deliver that?

The reason we have been so successful and the reason that we have grown so rapidly is the fact that we have delivered on true customer service. We’re pretty aggressive. We do make promises to customers. We’re realistic. We follow through and we deliver on those promises.

We are able to provide the technical proficiency and the client services and responsiveness that clients expect. We actually try to exceed their expectations in every case versus just meeting their expectations

If you meet a customer’s expectations, that is the low threshold of where you need to be. Everyone tries to meet expectations. We try to exceed expectations and do it every case. By doing that, we have been able to keep clients for years. Some clients we have had since we’ve been in business.

We give the same level of service to our employees as we do to our clients. In a growing company, if you take care of your employees, then they will take care of your clients. That is very important, too.

The last thing is we build long-term relationships. We are not in it to turn a quick buck. Because of that, we have had low turnover in staff and have kept clients for years.

How do you ensure that you deliver quality customer service and exceed expectations?
We need to have people on staff that are good communicators - people who already possess those customer service skills. That is something that is very difficult to teach. When we hire people, we look for people with those attributes. Once people are brought into the company, we try to further ingrain that customer service mindset into each one of the employees. We try to instill an overall client service culture in our company as a whole. That is something we emphasize every day to our people because it is so important to us.

All three of us owners, every job we ever had has involved strong customer service. When you boil it all down, that is what has made us successful.

There is a difference between customer service and true service. Most people are motivated by money to give clients service. I think that there is a level of sincerity that people can detect. Sincerity is important.

If you are faking it, clients can see through that. We are really out to make sure that we’re providing good service to clients. It is a custom solution for every client. We don’t try to make every client fit into a mold because every client is different.

To me, true service is when you do something for someone and you don’t expect something in return. All businesses are in business to make money, but if you take that true service mindset into the business world and make it your priority to serve people as opposed to making money, then the money will come. People are willing to pay for that type of service because it doesn’t exist that much.

HOW TO REACH: Perpetual Technologies Inc., (800) 538-0453 or www.perptech.com

Wednesday, 23 November 2005 05:43

Packaging perfection

Seventeen years ago, Andrew Berlin made a life-changing decision — he quit his job as a lawyer for a large Chicago firm and bought a packaging company with his father.

When the Berlins bought Alco Packaging, now Berlin Packaging, the company had $69 million in sales. Today, it has grown to more than $250 million in sales and has nearly 300 employees.

The company has designed packaging for companies including Coca Cola, Keebler, Crayola and Tylenol.

“It’s been a lot of hard work but it did not come about without a plan,” says Berlin.

He believes his success is a result of his competitive employees, as well as of his unique selling strategy. Both factors helped lead Berlin Packaging to become the country’s largest supplier of plastic, glass and metal containers.

Smart Business talked with Berlin about the importance of his employees and how he makes his customers more money than the competition does.

How is the company different today from the one you bought in 1988?
It is more than four times the size. Our net earnings have grown over 24,000 percent from 1988 to 2004.

The big difference, which is less quantifiable but is every bit as important, is our people. Our secret weapon, our No. 1 competitive advantage, is the culture that we have.

That is not just my culture, but the culture that is prevailing throughout the entire organization and all of our employees.

How do you find the right employees and create that culture?
We have an unusual recruiting expertise in our company where we are able to not only hire people with the right skill sets but we hire people with very similar traits. The personality traits that we have in our company are a very strong, aggressive, can-do attitude.

This is summed up in our company motto that you will see in our advertising, on our business cards and on our Web site. ‘Anything is possible’ is the motto, and that really embodies everything that we do in the company.

The people we hire seem to derive joy from crushing competition. That’s more than just being a competitive person. That’s a person that wakes up every morning looking for ways to beat the other guy.

When you get several hundred people operating that way, you are going to grow your company by serving your customers better, taking care of the suppliers and customers and taking care of each other.

In addition to finding the right people, what are your business strategies?
Our main business strategies are to focus on global sourcing. We bring in anywhere from 15 (percent) to 20 percent of the product that we sell from overseas. You have to be so careful about where you buy from and how you do business overseas.

There are so many potential pitfalls. It could be with the transportation — the associated costs of bringing the ware over. You have to be careful about the quality. What if something goes wrong after it has been shipped here from China or India?

There is a lot of work to be done on the back side before you start bringing in ware and product from overseas. That’s something we have been getting good at. We’ve actually established a global sourcing division that is focused on helping our customers achieve lower costs by buying overseas but doing it in a way that avoids the pitfalls.

Another business strategy that is gaining tremendous momentum now is our design division, called Studio 111. Studio 111 is a design studio and its mission is to increase our customers’ sales by helping them with package design. The whole idea is that if we can increase our customers’ sales by giving them better package design, then they are going to buy more packaging from us.

We’re also adding geographical locations. Today we have 23 locations. We’re hoping by the end of the next 24 months that we will have over 30 locations.

What is your philosophy of quid pro quo selling?
Why does anybody do anything that you want them to do? They do it because they think there is something to gain. To be more specific, why does a company buy from another company? The idea is they buy from another company because they think that company may be able to do something for them.

In many cases in business, the main goal is to make more money. If the No. 1 goal of a company is to make more money, then you have to ask yourself, ‘How can I help the customer make more money?’ If I help the customer make more money, then they will be more thrilled to do business with us.

There are three ways to help a customer make more money. You can help lower their costs. No. 2, you can help improve their productivity. For example, if we’re always delivering on time, then they don’t have to take the time to find out why the shipment is late. Then they use that time more productively.

The third way is to help increase their sales. If you can quantify those three ways to help a customer make more money and you put a calculator to how much more money they’ve made in the process of doing business with you, then they will end up doing more business with you.

The whole quid pro quo phrase (means) I’ll do something for you if you do something for me. The customer is going to buy more from you if you can help them meet the No. 1 goal. I presume the No. 1 goal any company has is they want to make more money.

A customer is going to do business with us versus one of our competitors if they feel that we are going to make more money for them than the other guy.

How do you use that to create a brand for yourself in the marketplace?
The way we present ourselves and the way we go to market is we believe we are a supplier that is going to help you make more money than any other supplier. That is a very different approach to selling.

Most companies will try to give (customers) the lowest price. In my mind, the lowest price only gets you one of those three ways to help a customer make more money - lower expenses. But, as a supplier, what are you doing to help them be more productive? What are you doing to help them increase their sales?

That’s why we’ve been excelling. The packaging industry only grows about 3 percent a year. Yet, Berlin has experienced double-digit growth every single year for the last 14 or 15 years.

This year, we are 33 percent ahead of last year. We’re obviously taking market share from our competitors. We do that through quid pro quo selling or, in my mind, good selling.

HOW TO REACH: Berlin Packaging, (800) 7-BERLIN or www.berlinpackaging.com

Thursday, 29 September 2005 06:06

Ticket to success

Mike Domek, CEO of TicketsNow, has always been fascinated with the entertainment industry and in 1992, turned that fascination into a business.

From his one-bedroom apartment in Chicago, Domek started TicketsNow — which sells tickets for everything from concerts to major sporting events — with a two-line phone and a $100 investment. In 1999, he moved the company online, and it became TicketsNow.com.

Today, TicketsNow is the United States’ leading online ticket marketplace, with 2004 revenue of $55 million and projected 2005 revenue in excess of $100 million.

Although Domek had no experience when he went into business, he created a successful company by looking at a marketplace he was interested in and thinking about ways to improve it. What is his secret to success?

“Never stop listening to your customers,” says Domek. “They’re the only ones that truly know what they want, and they’re willing to tell you if you’re willing to listen.”

Smart Business talked to Domek about TicketNow’s transformation from a one-man business into one of the fastest-growing private companies in the United States.

What challenges have you faced as your company has grown?

The biggest challenge for me was learning how to build a business from the ground up and learning how to run it. I started the company just out of college.

I didn’t finish school. I had never worked for a major corporation. I had to learn virtually everything there is to know about building and running a business. I learned it by doing it, through trial and error, and by talking and listening to people who had done it before.

When we started, we were the first company selling tickets online in the secondary market. We grew quickly to far exceed eBay. By providing the secure marketplace and backing it up with outstanding customer service, we knew we had the best product on the market.

We grew based on listening to our customers. Everyone wanted to get premium tickets to premium events, but five years ago, it was kind of scary buying tickets from a secondary market online. You really didn’t know who you were dealing with or who the tickets were coming from. The industry was fragmented and inefficient.

Those were the challenges — running a business that I had no experience doing and creating a business in this industry that really didn’t exist before we got into it.

How do you attract the best employees?

We do a lot of standard things. We use some executive search firms to attract new talent, but also a lot of traditional recruiting techniques, like advertising in local papers and employment Web sites. We also have an employee referral program.

I think what really lands employees for us is that we’ve done a great job at creating a fun and exciting environment where people want to work. Cultivating a positive corporate culture is important to me. I think that employees see that, and people really enjoy working here. We regularly host company parties and picnics. We try not to be a fragmented company. We try to create that family atmosphere.

How did you overcome IT challenges, and how did that facilitate the growth of your company?

That was something that really needed to be addressed. We were growing faster than we could keep up with from an IT standpoint. The first step in getting a team together that could support the demand was the hiring of our current VP of IT, Gene Golden.

Gene has been able to recruit some of the brightest IT minds in the country for us. We’re not just getting bigger in our IT department, we’re also getting better.

With our rate of growth being nearly 400 percent in the past five years and doubling again this year, and constantly needing more bandwidth and capacity, getting the right people and partnering with HP has really met our needs.

Being an online company, the public demands 24/7 availability without fail. With our HP servers and our top-notch IT department, we’ve got 99.9 percent up time. And that’s critical, and not just for TicketsNow.

We develop and license out data and software to other ticket companies. We really are the backbone of the industry. If we’re not up, not only is TicketsNow down, but a lot of our industry is down as well. They depend on us.

How do you outshine your competitors?

One thing I have learned over the years is that innovation and quality truly matter. We have invested a lot of time, energy and financial resources to develop and deliver the highest quality product. We don’t cut corners. We don’t skimp on quality. We ask the customers what they want.

I think eBay has a good product, but tickets are not a one-size-fits-all. Within tickets, there is this element of fraud that exists within public sites.

TicketsNow has been able to eliminate that by guaranteeing 100 percent legitimate tickets and 100 percent secure transactions. We are the only ones able to do that. I think that is how we really outshine our competitors. We don’t just provide some guarantee that if you have a problem, we’ll fix it. We provide a guarantee that you won’t have a problem because after the event, it’s too late to fix that problem.

HOW TO REACH: TicketsNow, (800) 927-2770 or http://www.ticketsnow.com

Tuesday, 30 August 2005 11:58

Determining his destiny

Jeffrey Harris and John Robinson wanted to control their own destinies, so in 1993, they founded Meridian Real Estate. Twelve years later, they’ve turned their destiny into a huge success.

The company includes a large client base and has been involved in some of the largest real estate transactions in Indiana. Harris, president of Meridian, attributes their success to their ability to adapt to a changing marketplace.

“Since it is just me and my partner, we can make decisions quickly. If we need to do something differently, we can basically do it overnight,” says Harris. “We’ve been very adaptable to generating revenue in many varying types of markets. That has been a big part of our success, and I think it always will be.”

Smart Business talked with Harris about Meridian’s road to success, competing against national companies and the challenges of finding good employees.

What are the challenges of being a local company competing against national companies?

The big challenge is a lot of the national companies will basically get a phone call that one of their national clients has an office here in town. There is not much — or any — selling or having to pitch for the business. It just has already been acquired at the national level.

It makes our jobs much more difficult because in many instances, they’re not getting the best adviser in town or the person who would be best-suited to their particular situation. If it were more of a free market, where you went to interviews and picked the best fit, I think that the company would get better service and better results because of it.

And it makes it more difficult on our business because we don’t get a chance to go over there and tell them about us and how we have been able to help other companies. But at the same point in time, we have done work for national companies that don’t have alliances or national accounts, and we have had to win the business, and many, many times we have had to compete against everyone in town.

We have got a strong market share, as well as a strong group of brokers, and we win more than our fair share of business.

What obstacles did you have to overcome as Meridian grew?

You have to put systems into place and organizations into place because if not, your entire day just gets chewed up with making sure things get done right. You have to put capable people in responsible positions that can handle things, so that you can oversee things and get out there and develop relationships and pitch business.

I really haven’t had a lot of obstacles. It is hard to find good, productive people. We have added people and let people go, because frankly, they were not productive. You have to be willing to tell people who aren’t productive that they are not in an appropriate way.

The best thing you can do for them is to let them know that they need to do something different, because it is not good for them, let alone good for the company. The biggest obstacle for us is to find quality people who mesh well with the existing personality structure and who are also productive.

We would add a lot more people if those three things could be met, but they are very difficult to find.

How do you attract and retain quality employees?

There are two ways to do it. You can attract existing people from other companies who are producers or you can train new people. We have done a little bit of both. We have three or four young guys who came over after college, and we are teaching them the business.

We also have a number of guys who were producers in other shops who we attracted over here. Trammell Crow had an office here in town and closed it in 2001. We did not have an industrial division at that point, and the Trammell Crow office was basically just industrial. We grabbed their entire industrial team and brought them over here.

That was a good revenue source for us, and they are doing extremely well right now. We were fortunate to be able to put that together.

What skills are essential for leading a fast-growing company?

You have to have patience. You have to be willing to see others’ point of view and merge those points into your opinion. You have to be able to deal with multiple personalities. You have a diverse group of people working under you that react differently.

I also think you have to be consistent with your message. You have to be organized. If you put those things together, people will respond. People want to know that what you say is what you mean, and that you are going to do what you say you are going to do. And that you follow through with things.

We all share the same database. We all work together. We all have different skills and different relations. We are not a typical company where everyone is protecting their business and not sharing any of it.

We are just the opposite. I think that makes us different.

How to reach: http://www.mresonline.com