Born: Garden City
Education: Eastern Michigan University
First job: I had paper routes when I was younger, but my first real job was at a Dairy Queen not far from my house, where I worked summers.
While in college, I worked on the line at Ford and hung out with my friends, who worked at this pizza place. That pizza shop was the converted hamburger shop Jim Hearn [Hungry Howie’s founder] opened. I left college before graduating because there were few teaching jobs available in the 1970s. I quit Ford Motor Co. and I opened up Hungry Howie’s No. 2.
What is your greatest business challenge?
Franchisees come to us because they want to fulfill the American Dream. They want to be in business for themselves, but they want to come to us to learn a business.
To manage those entrepreneurs is a challenge. We have to be able to channel their spirit and teach them new things in a way they will accept them.
What is the most important business lesson you’ve learned?
You have to be able to identify people’s strengths and don’t ask them to do more than they are capable of doing.
Whom do you admire most in business and why?
I admire people like Ray Kroc, Colonel Sanders and Dave Thomas. When Kroc and Sanders started their businesses, Ray was in his 50s and the Colonel was in his 60s.
There is never a timetable on success there is never a time you can’t say there is a new opportunity in life. Some people get focused on what they are doing and are afraid to change. When you look at leaders like that, it renews your interest and belief that anything is possible at any time in life.
Jean Moliere (Jean-Baptiste Poquelin), 15th century playwright
Many if not most businesses are faced with the unenviable task of informing employees that they must share more of the financial burden of health care costs a difficult pill to swallow for even the most realistic of workers.
As employees become more financially responsible for their health care, they want information to help them understand where their money is going. This is good, because it helps them think more like a business and brings them face-to-face with the real cost of their care.
The question is this: Is there relevant, reliable information available to help them assume more responsibility and make the transition smoother? The answer is yes, and you can help them find it.
It’s important to keep in mind that, as an employer, you don’t have to carry the educational burden alone most health insurance management companies have resources that can help you communicate with your employees.
In fact, it’s in the insurer’s best interest to keep people healthy and help demystify the health care system. Many of these companies have done a great deal of research in these areas and would be happy to share with you the tools and information they have available for your work force.
One of the strongest motivators for changing employee behavior (regarding health care responsibility) is cost. Employers have known this for a long time, but it’s actually a new experience for many employees.
Health insurers can give your employees access to powerful tools that include features such as cost estimators, which provide cost information for the most common services and conditions affecting families today.
Tools like this are easy to use and comprehensive. Employees who use these tools will have a much clearer picture of the actual costs for primary care visits, specialist visits, diagnostic and other medical services, as well as medication costs. Cost estimates are derived from claims databases and use a sound statistical methodology.
With the growing trend toward consumer-directed health care plans, health savings accounts (HSAs) and an increasing amount of medical information in general, there are also coverage advisory tools that can help employees understand how to fund tax-preferred HSAs and organize complex information into easy-to-read reports. By entering some simple financial and health information, these systems can calculate plan options best suited to their specific needs.
There are also extremely powerful and in-depth online research tools which allow your employees to login to secure Web portals to research medical illnesses, do specific hospital comparisons, find quality data, customer satisfaction ratings, success rates and more.
Independent medical experts evaluate all health information; hospital comparisons are based on current, publicly reported data pulled from nationally recognized accrediting agencies.
Education, of course, takes time. But by reinforcing the messages that, a) employees must accept an active role in their health care, b) there are resources available to help and c) they play the most crucial role in reducing costs, everyone stands to gain.
The shift toward employee responsibility has already begun, but employers can make a huge difference in how their work force accepts these changes. Businesses who take advantage of the educational resources available to them from their health plans may even boost employee morale and help employees feel better, not bitter, about the financial responsibility of managing their health care.
Graham Smith is director of marketing and product development for Care Choices, a nonprofit health care organization and a subsidiary of Trinity Health. Care Choices HMO is ranked as #7 among 257 commercial plans nationwide and is the top-rated plan in Michigan, according to U.S. News & World Report/NCQA “America’s Best Health Plans, 2005.”
As CEO of Giant Janitorial Services, she is actively involved with a staff of 100 employees who have been keeping commercial properties sparkling clean for more than 30 years.
The business started as a part-time job when Huthwaite was working for Merrill Lynch while her husband, now Giant Janitorial’s president, was in school. They needed extra income and found a way to make it by cleaning a small insurance office. The business quickly expanded, and Huthwaite decided to devote herself full time to managing its growth.
Huthwaite credits her father, an Italian immigrant, for her strong work ethic.
“He was a Detroit bus driver who came to the U.S. when he was 14 and supported his mother and two brothers for years,” she says. “Although I have met many admirable people in my business, my father instilled the qualities in me which have contributed to Giant’s success.”
Smart Business spoke with Huthwaite about how she finds great employees and how she balances quality and price at her business.
How do you stay involved with your customers?
The personal touch we offer makes a big difference. I prefer to go see the customer myself so that I am familiar with the property.
I circulate among the jobs and am very involved with the day-to-day operations. It helps that I am truly a people person.
Working with customers gives me energy, and that shows in how I handle the business today.
What changes have you seen in the industry since Sept. 11, 2001, and how have you handled them?
I have noticed a real difference. People are looking at the lowest bid more closely. The competition is fierce.
We work on a bid process, and I am surprised at some of the quotes I see. There are costs that have to be covered such as payroll, equipment, insurance and supplies. Taking shortcuts on any of them will show up in the workmanship provided.
We want to be as price-sensitive as possible but never at the expense of offering a consistent, quality result. It’s a tough balancing act.
I think one of the keys to success is expense management. I buy supplies in bulk and carefully monitor their use.
We train our staff on the proper use of cleaning agents. More is not always better.
How do you find great employees?
A number of ways: ads, word of mouth and referrals. We have stringent requirements that must be met before we bring someone on board.
Many of our clients are police offices and government agencies, so we have to be extra careful. Background checks are conducted and references are thoroughly checked.
This is a difficult business people think anyone can clean, but that is simply not true. The work can be rewarding.
But honestly, it gets boring, not to mention that it is strenuous, so lazy people do not last long. Turnover is typically in the 50 percent or over range in the cleaning business. Thankfully, ours is lower than that, but it takes effort on the front end during the hiring process.”
How would you describe yourself as a leader?
I’m a good listener, strive to maintain a positive attitude at all times and give employees the benefit of the doubt. Our business presents a communication challenge since we have people working at different places and different shifts all the time.
Although I have job supervisors, I want to hear from the employees myself. I’ve always felt two heads are better than one, so if there is a suggestion from an employee, I explore it.
I want to know their concerns. I am a careful listener, but I expect it to go both ways when I offer constructive criticism. For example, when I notice a floor is not being cleaned properly, I will provide the feedback to the employee.
He or she needs to accept it without a debate.
How do you see the future of your company?
I’d like to expand the business. I am pleased with Giant’s success, but I’m looking for a larger client base.
We rely on our current customers to get the word out, but I also spend time reaching out to companies by phone and mail, requesting that we be out on their bid list.
How to reach: Giant Janitorial Services, (313) 886-7797
Education: Wayne State College
First job: A snack food company after high school before starting at the ground level of a national marketing company in 1984
What has been your biggest business challenge?
It can be difficult to maintain a sense of normalcy and balance between your professional and family lives. As we all know, everyone juggles.
When you have a wife and children and a business and thousands of representatives and employees, and you have everyone that depends on you to make the right moves and decisions, you become a master juggler. One of my greatest challenges has been to prioritize my time.
ACN is very important to me, but it is not the most important thing. Because I can maintain a sense of balance between my family and ACN, nothing has gotten out of whack.
What is the most important business lesson you have learned?
Surround yourself with the right kind of people who are experts in their own fields who will come together for the good of the team. You also need to have the ability to attract better people than yourself without feeling threatened.
Whom do you admire most in business, past or present and why?
I’ve had many mentors, but one was a gentleman who formulated my thinking in business and life: Art Williams who headed up AL Williams, which is where I cut my network marketing teeth.
He truly stood for something and did phenomenally well personally and brought a lot of people with him.
Describe your leadership style.
When you have a volunteer army, it is a must to treat people like you want to be treated. Build strong relationships with as many people as possible.
The health care insurance industry is no exception. Fortunately, quality results for individual health plans, across a broad range of measures, are widely available and updated annually. And the news is very good.
According to the National Committee for Quality Assurance (NCQA), “For the sixth straight year, health care quality for the 65 million Americans enrolled in accountable health plans improved substantially across almost all clinical indicators.”
This year, the NCQA and U.S. News & World Report have collaborated to measure and rank the nation’s commercial, Medicare and Medicaid health plans based on quality. The report is called the U.S. News and World Report/NCQA “America’s Best Health Plans, 2005,” and comes at a time when it is needed most the annual open enrollment period.
The health plan ranking is based on 41 separate measures of quality summarized into a single overall quality score and further detail in four key areas.
- Access to care
- Overall satisfaction
The quality equation
For any company, organization or agency, quality doesn’t just happen. It’s the result of well-designed processes and successful integration across the entire organization.
For a health plan, this includes the combined efforts of health care providers, health plan members, health plan purchasers and the health plan itself playing the critical role as integrator. The objective is to make sure people get the right care, in the right place, at the right time.
This quality equation not only provides people with better health care, it has the potential to reduce costs as well.
According to NCQA “...more than $9 billion in lost productivity and nearly $2 billion in hospital costs could be averted through more consistent delivery of best-practice care. ... Expanded performance measurement, better care coordination and broadened accountability throughout the health care system are proven methods of enhancing quality, and it is essential that they be incorporated into the new, less integrated health care delivery system of tomorrow.”
Investing in quality
Gains within health plans and future gains are currently threatened. Rising costs lead employers to accept new health plans with untested results and unmeasured quality, both of which would be necessary for improvement.
According to the NCQA, “... And consumers do not yet have access to the kind of information they need to make informed decisions about their care.” Although these actions can reduce short-term costs, they can have a negative long-term affect because they do not address the quality component needed to keep employees healthy over time.
Take employees with chronic health conditions, for example. Although they may constitute less than 10 percent of the work force, this same group accounts for 80 percent of all health care expenditures.
That translates into 80 percent of inpatient care, 83 percent of prescription drug use and 50 percent of emergency room visits. Providing employees with access to quality health care can substantially lower these costs in the long-term.
When evaluating health plan choices, employers should keep the following in mind.
- Use publicly available quality information in your decision-making
- Carefully balance the expense and investment sides of the quality equation
- Consider direct and indirect cost savings, both current and future
- Expect health plans to continue and extend efforts to improve quality that truly makes a difference in health and well-being
- Consider joining other employers in encouraging and supporting broadened public reporting of quality information
Ed Tuller is director of quality development for Care Choices, a nonprofit health care organization and a subsidiary of Trinity Health. Care Choices HMO is ranked as #7 among 257 commercial plans nationwide and is the top-rated plan in Michigan, according to U.S. News & World Report/NCQA “America’s Best Health Plans, 2005.” For more information, visit www.carechoices.com
Richard Surratt was appointed senior vice president and CFO of ProQuest Co.
Before joining ProQuest Co., Surratt was executive vice president, CFO and treasurer of Independence Air. During his initial tenure from 1999 to 2002, the business grew rapidly to $760 million. After the Sept. 11, he was instrumental in implementing the change to an independent carrier with more than 600 departures a day in North America.
Prior to Independence Air, Surratt was with Mobil Corp. for nine years, where he was promoted through a series of financial positions in corporate finance, accounting and new business development. He gained international experience in his role as treasurer for Mobil’s Latin America operations at a time when the company invested more than $2 billion in that region. He also gained experience in mergers and acquisitions as the lead finance member of Mobil’s M&A team during its merger with Exxon Corp.
“Richard is a seasoned financial leader with broad experience in varied business situations, from large multinational to mid-cap companies,” says ProQuest chairman and CEO Alan Aldworth. “I am confident his skills will add significant value to ProQuest’s growth and portfolio management strategies.”
Surratt earned an MBA from Stanford University and a master of science degree in engineering from George Washington University. He is also a CPA.
BrassCraft promoted Peter Kattula to vice president, supply chain and planning.
He was previously vice president, operational planning. He will also retain responsibility for his current operations strategy initiatives at BrassCraft.
Kattula joined BrassCraft parent company Masco in 2000 as an operational services consultant and previously held various supply chain and industrial engineering positions with Ford Motor Co.
He earned an engineering degree from Michigan State University and received an MBA from Wayne State University.
BrassCraft manufactures water supplies and other plumbing products for the wholesale and retail markets.
Ron Klausner was appointed president of ProQuest Education Businesses.
He previously worked as president of ProQuest Information and Learning and as acting president of Voyager Expanded Learning.
Klausner joined the company in 2003 and is responsible for improving the results of higher education and news businesses across Information and Learning’s global library markets. He also expanded the company’s presence in the K-12 market through acquisitions.
David Prichard was appointed president, higher education and library businesses, for Information and Learning.
Prichard previously worked as senior vice president, Information and Learning global sales.
Prior to that, he worked for LexisNexis from 1995 to 2003, where he held a number of senior management positions.
Prichard earned a J.D. from the University of Baltimore School of Law and a bachelor’s degree in political science from Towson University.
Jack Bowen joined Urban Science, a leading global consulting firm, as chief marketing office.
Bowen was previously general director of GM/CRM, General Motors Corp.’s CRM organization, since 2003 and responsible for GM’s interactive marketing and advertising.
As general director of GM/CRM, Bowen was responsible for all of GM’s online and search advertising for its dealer Web-publishing service, the development of online shop-and-buy tools and marketing for GM Web publishing. He also oversaw GM’s third-party sales lead consolidations.
Bowen spent 10 years with Leo Burnett Advertising as a vice president, account director and supervisor, handling national accounts such as United Airlines, Kraft-General Foods, Sony, Black & Decker, Swift and Procter & Gamble.
He served as an aviation captain, platoon leader and pilot in the U.S. Army in the early 1980s after graduating from the U.S. Military Academy at West Point, N.Y., with a bachelor of science degree in general engineering and a master of science degree in systems management from the University of Southern California.
AMERICAN DIETETIC ASSOCIATION
Bethany Thayer of Health Alliance Plan was named national media spokesperson for the American Dietetic Association.
Thayer is one of approximately two dozen national ADA volunteer spokespersons and the only one in Michigan.
Thayer has extensive experience as a media spokesperson on a local and national basis. She began participating in media interviews when she became a registered dietitian in 1989, and she served as a spokeswoman for the Michigan Dietetic Association from 2003 to May 2005. Her areas of specialty include obesity, cardiovascular nutrition, diabetes, healthy cooking techniques and children’s nutrition.
In Thayer’s position as customer segment coordinator at Health Alliance Plan, she develops and implements health and nutrition-related programs for women and parents. She serves as editor of the HAP Wise Woman magazine, a full-color magazine for female HAP members ages 35 to 54. She also created HAP’s weight management program, Weight Wise. More than 3,700 HAP members have participated in the program since it was launched in 2004.
Thayer earned a bachelor’s degree from Michigan State University, and a master’s degree in exercise science from Oakland University.
Health insurers are aware of this and are looking for ways to offer good, affordable plans to suit a variety of employers. As a result, one of the newer options is a consumer-directed health plan (CDHPs) -- a high-deductible benefit plan combined with personal health savings accounts (HSAs) or health reimbursement arrangements (HRAs). Below, we discuss HSAs.
An HSA is a tax-exempt account with a financial institution in which funds accumulate to pay for qualified medical expenses. They can be paired with high-deductible plans, which have lower premiums and allow employers to choose a program that is right for them and their employees, regardless of group size. These arrangements help empower employees to make more educated decisions on their health care choices.
They also offer numerous tax advantages to both employers and employees, as they are triple tax-free. That is, contributions, growth and spending related to these accounts are not subject to state or federal taxes. In addition, the account goes with the holder whether they change jobs, retire, move, etc.
The account holder is responsible for paying for services until the deductible is met. Once it is, they pay a coinsurance, while the health insurer covers the remaining portion of the expenses. If the member's expenses reach their out-of-pocket maximum, the health insurer then pays all charges.
Individuals can use tax-free dollars to pay for medical expenses not covered under the high-deductible plan, such as dental, vision and alternative medical expenses. They can also use funds to cover co-payments, deductibles, coinsurance and prescriptions. Unused HSA contributions rollover from year to year and accumulate to be used for future health care expenses.
It's important to keep in mind, however, that HSAs need to be managed -- individuals who are not good at keeping receipts, watching balances and keeping track of medical expenses might not be good candidates. There are many online tools that can make this easier, but it isn't automatic -- it still requires investment on the part of the consumer.
On the other hand, high deductible plans, paired with HSAs, give many employers the ability to offer good health insurance coverage for their employees -- an option that hadn't been available in the past and which troubled many small businesses. This allows employers to offer a health benefit with less financial burden.
Another key aspect of these arrangements is their emphasis on staying healthy. Most preventive care services are covered by the plan, like annual physical exams, well-baby/child exams and immunizations. But consumers must also be willing to seek care when it's appropriate, and know where to go when they need it.
A good health insurer will have information readily available on health care options for people who seek it. Their Web sites can be trusted to have accurate information on where to go for help in seeking treatment or how to manage chronic diseases like asthma, heart disease or diabetes.
These arrangements present a wonderful opportunity for great health care coverage for many people For the right businesses, offering these plans to employees can make a significant difference by not only lowering the company's health care costs, but helping employees access health care when, where and how they need it.
Mike Koziara is chief financial officer for Care Choices, a nonprofit health care organization and a subsidiary of Trinity Health. Care Choices HMO is ranked No. 7 among 257 commercial plans nationwide and is the top-rated plan in Michigan, according to the U.S. News & World Report/NCQA America's Best Health Plans 2005.
American Jobs Creation Act
AJCA ushered in the largest business-tax reform since 1986. The tax act began as a phase-out of the export subsidy, but it eventually mushroomed into a major tax law benefiting most businesses and some individual taxpayers.
- Take advantage. Congress devoted a portion of AJCA to a new deduction for manufacturers. The term manufacturer has been broadly defined to cover more businesses than just traditional manufacturers, so the deduction is available to businesses engaged in activities such as construction, engineering, architectural services, computer software production and agricultural processing. The deduction applies to domestic production activity, but contains no export requirement.
Plan now to maximize your benefit from this new deduction. Determine whether your business qualifies, if there are ways to maximize your deduction and how to capture the necessary information from your accounting system.
- Keep an eye on deferred compensation. Another significant portion of this legislation involves compensation plans that are defined as nonqualified deferred compensation. These arrangements are a promise to pay executives and key employees sometime in the future for services they currently perform, and include phantom stock plans, certain stock appreciation rights and other programs in which income is delayed.
If a plan fails to meet the provisions and new requirements, it will result in loss of the tax deferral. The result is taxability on all amounts previously deferred, plus charged interest and a penalty tax of 20 percent.
Nonqualified compensation can still be an effective way to compensate employees. However, you need to determine whether your plans are covered by the new rules and then map out how to bring them into compliance by December 31, 2005.
- Expense when you can. Generally, equipment with a useful life of beyond the taxable year must be capitalized. AJCA extends the increased Section 179 expensing deduction amount and allows for faster depreciation on qualified leasehold improvements.
The Section 179 expensing election allows for a current deduction for assets that would otherwise be subject to normal depreciation rules. In 2005, the Section 179 deduction is $105,000, but for tax years beginning after 2007, this amount is scheduled to drop back to $25,000.
So it may be appropriate to schedule major capital asset purchases in the next couple of years, when the greatest tax benefit may be available. And if you have more than the maximum $105,000 limit in 2005, choose those assets for expensing that would have had the longest life under normal depreciation rules. If total asset acquisitions exceed $420,000, the expensing election begins to phase out.
- A choice for individual taxpayers. Congress couldn't resist the opportunity to further tweak individual itemized deductions. An election, similar to 2004, allows for a taxpayer to choose between deducting state and local income taxes, and state and local sales or use taxes. A review of major taxable purchases should take place to see if the sales or use tax paid in 2005 may benefit you. Also, a review of prior year purchases (2004) could result in an opportunity to amend that return.
Working Families Tax Relief Act
WFTRA extends a number of individual tax breaks, including the $1,00-per-child tax credit, the expanded 10 percent tax bracket and the increased alternative minimum tax (AMT) exemption amount. Increasing the 15 percent tax bracket range and standard deduction amount on jointly filed returns provides marriage penalty relief for a while longer.
Although such breaks may not make a significant dollar difference individually on a tax return, they will benefit millions of taxpayers across our nation. Moreover, WFTRA also extended some business credits.
James P. O'Rilley is a Certified Public Accountant and director of taxation at Doeren Mayhew, a regional accounting firm in Troy, Michigan. Doeren Mayhew provides a wide range of professional services to middle-market companies. Contact O'Rilley at firstname.lastname@example.org or (248) 244-3171.
The reasons for this vary, but in many cases inadequate business and estate planning, and poor training and transition planning, are the primary culprits. Failure to recognize and plan for the psychological and emotional aspects of succession planning also contributes to this failure rate.
There are many questions that need to be asked and answered before a succession plan can be developed. Important factors to take into account before attempting to develop the succession plan include the following.
- The business founder may be emotionally tied to the business, and reluctant to get family members involved, transition or diversify management responsibilities, or commence the appropriate training early enough in the process.
- Each family member may have a different view or opinion of the business and how it should be run, depending on whether he/she is actively involved in the business or merely a passive owner expecting to benefit from distributions of profits.
- The business itself may represent a large portion of the family's wealth.
- The customers of the business may be more loyal to the current owner(s) than to the business itself.
Most business owners share an emotional and psychological identity with their business; it is part of them and they of it. Business succession planning involves or affects the entire family, requires open and direct communication and is impacted by plenty of emotion.
The transfer of ownership, management and even the mission statement or philosophy of the business to individuals who are qualified, experienced and capable is critical to the future success of the business. Not all family members are qualified or ready to succeed the founding family member, and discussing and recognizing this can be the biggest barrier to a well-conceived plan.
Conflicts among family members, those who are involved and work in the business, and those not involved but who hold an ownership interest and enjoy the profits of the business, will inevitably arise. A good business-succession plan will not only anticipate this, but will also develop a strategy and procedure for how these conflicts will be resolved.
A business owner must be willing to identify and discuss the needs of the business and the qualifications of their family members, and each family member's potential role in the succession plan. A well-conceived succession plan will establish the qualifications for family members becoming involved in the business, as well as the standards by which they will be evaluated.
The plan will also establish criteria for compensating family members, rules for electing officers and directors, and may even provide for outside directors.
From an estate-planning perspective, closely held and family businesses are typically very illiquid, and a partial interest in the business may be difficult to value. This can create issues if estate taxes are owed at the owner's death, or if a family member has a right to sell their stock to the other family members or to the business itself for redemption.
Regular communication among all family members who have an interest in the business, whether active or merely as an owner, and a review of the established policies and performance of the business are important elements for continuing a successful transition.
Kevin Bernys is a member in the Bloomfield Hills office of Dickinson Wright, where he practices in the areas of estate planning & trusts, corporate, taxation, employee benefits and mergers & acquisitions. For additional information, please visit www.dickinsonwright.com.
Although building a business around the impulse buyer seems risky, it was a successful strategy, and today, Thrifty Florist is one of the largest florists in Michigan.
About 80 percent of Rea's customers are impulse buyers -- people passing by who see the store, decide to stop in and buy flowers on a whim. The other 20 percent place orders via phone, catalog or the Internet.
"Most florists are the opposite," says Rea. "They only receive 20 percent impulse buyers."
Rea's business model differs from that of his competitors in more ways than just his clientele. When he opened his first three stores, he was able to bring in flowers by the truckload and cut out the middleman.
Growers ship flowers directly to his distribution facility and the flowers are transported to Thrifty Florist shops that same day or, at the latest, the following day. That guarantees the flowers are fresh, and without a middleman, lowers the cost to the consumers.
As Thrifty Florist grows -- the company employs more than 150 people at 14 locations -- Rea is proving his business model works just as well for a larger company as it did when Thrifty Florist was smaller.
Smart Business spoke with Rea about his unique business model and how he has made Thrifty Florist a success.
How does your business model differ from that of your competitors?
We are located on major intersections throughout the city in freestanding buildings. We attract a substantial amount of impulse buyers.
Eighty percent of our business is walk-in, which is not typical of traditional retail florists. We also spend a tremendous amount of time on merchandising.
How do you attract impulse buyers?
Through our locations and displays. Our retail locations allow customers to come in and look, as opposed to shop through a catalog. We do have catalogs, but people generally like to come in and look.
Why don't you hire people with industry experience?
We've always been more successful when we hire people who have experience outside the industry because we do a lot of things that differ from typical florists.
We work in a fast-paced environment. In that sense, it is a little bit of a culture shock for people who have been in the industry for a while and worked for other florists, although we do have some employees who have owned shops before and have industry experience that are successful employees in our shops.
We train people on how to use our POS system, which we run our business on. There's also specific software we use that helps us track our orders and sales, as well as monitor our customers.
We also give our employees telephone training, which helps them to take sales orders over the phone. We give employees an overview of how the store operates, with guidelines on the merchandising look and feel for the store.
Once an employee has been with us, we also offer design classes on how to make arrangements, corsages, wedding arrangements, etc. Over time, they receive fairly extensive training on running a flower shop.
How has that helped you to better run your business?
Training is a key part of our business because we do things a little bit differently than other florists. In terms of providing our customers with great service, it's critical that our employees understand how our business works and our merchandise.
It is also critical that they have enough knowledge to have the ability to offer our clients expert advice. Customers appreciate that. I think a critical component of a company's success is spending substantial time and effort on training.
How are you able to keep prices lower than your competitors?
Fifteen years ago, I made a better effort to understand the business and where these flowers come from. Over the years, I have established many relationships with different growers.
Flowers are shipped directly to us from whatever part of the world they are grown -- they are not going through a middleman or sitting in a wholesale house facility. The flowers are actually grown and cut specifically for us.
From the distribution standpoint, we can cut anywhere from two to four days.
As you continue to grow and open new stores, is it still feasible for you to cut out the middleman?
The key to that is having a significant volume. When you are buying direct from growers, it is a lot more difficult to buy direct if you don't have a large volume.
Actually, the more stores we have, (the more that) enhances our ability to outsource products.
How do you cater to your customers in a way that makes you stand out from the competition?
The key to our business is we provide a tremendous amount of convenience for our customers. They can get in and out of our stores within a few minutes. They don't have to park in a big parking lot and walk a couple hundred yards to get into our store.
Identities and prices for all products are clearly displayed on each item. Our staff has decades of experience in the floral industry. All of our Thrifty Florist representatives can provide knowledgeable information about all of our products.
We also provide a wide range of services at reasonable prices. We do weddings and parties and events. Many of our customers shop at our store a couple times a week.
HOW TO REACH: Thrifty Florist, (888) THRIFTY or www.thriftyflorist.com