To grow a successful company, you have to take risks, even if they don’t always pay off, says Herb Engel.
“Sometimes, you just have to look at it and say, ‘Sometimes, they work; sometimes, they don’t,’” the president of Marine Group Boat Works says.
The full-service boat and yacht repair facility founded in 1986 as an offshoot of a boat yard business founded by Engel and his brother, Art has grown despite facing several challenges along the way: The company reached 2007 revenue of $13.3 million an increase of 88 percent over 2006 and has 50 employees.
Smart Business spoke with Engel about the keys to growing your business and how to learn from mistakes with growth.
Q. What are the keys to growing a company?
Analyze your market and look at what’s out there. Look at what the existing market is. We put together a business plan at the beginning of every year and sit down and look at the markets, what’s available in the segments and figure out how much we think we can do. As we go each year, then we get better and better data that we can go back on and track ourselves and see how we’re doing.
The biggest thing is to know what your market is. You’ve got to go ahead and know your market and what you think you can pull out of the market and plan accordingly.
Keep in touch with your industry. You look at trade journals and magazines. You go to trade shows, keep up to date with industry happenings and contribute to organizations that benefit your trade. Networking and keeping in touch with contacts that you have made is also key.
Passive involvement has no advantage, but if you take initiative with the affiliations you make and actively seek to collaborate with these people or businesses, you’ll know what’s going on, and it’ll help make you an expert at what you are doing and what your competitors are doing.
Q. How do you communicate the plan to employees?
We let people know how we’re doing, and it’s just part of the whole philosophy. They don’t have to know numbers; the main thing is, they know the philosophy is we want to grow and move forward.
The people who own it and manage it, it’s their mindset. Our plan is built by key people.
We get input from managers and employees on a regular basis. They provide us with insight as to what works and what does-n’t, and we take their input and incorporate it into other forms of research, such as examining past experiences, following current and future market trends, and seeing where we can be along those trends.
Feedback helps us find more efficient ways of doing things, and when that happens, everyone is much more motivated to integrate it into their practices.
Q. How do you manage growth?
You’ve just got to get in there and get it done. You have to staff up and get in and get the work done. It’s always a concern to say, ‘Let’s take as much as we can take,’ but a lot of times, that can cause you problems. There are times you have to just come around and say, ‘Boy, that would be a nice job, but we can’t do it.’
If you’re trying to grow a company and grow it quickly, look into different areas such as new or niche markets within an existing market. Spread yourself out. But make sure you look to your goals and resources to determine what is attainable.
At the same time, spreading yourself out doesn’t mean spreading yourself too thin. Don’t try to bite off more than you can chew.
Q. You said that taking risks can sometimes result in mistakes. How do you overcome those and use them as a lesson for future growth?
Look before you jump, make sure you understand what you’re jumping into, and make sure you understand the market. A couple of the businesses that we got into that didn’t work out well, I don’t think we understood that market.
If you look at what the market is and understand it ... these other businesses we had problems with were not related back to what our key business is ... so we understand that market and that industry.
Sometimes, people think because they do one thing ‘I was great at this business; I can do anything’ and then they get off and into something that they don’t understand the business, and the next thing you know they’re in trouble.
HOW TO REACH: Marine Group Boat Works, (619) 427-6767 or www.marinegroupbw.com