Boss Life

by Paul Downs

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  AFTER LUNCH I take a break from spreadsheets and e-mails and go out to the shop. Ron Dedrick has started building the Eurofurn prototype table. All the parts have been cut on our CNC, and he is gluing a strip of solid walnut to one of the top pieces. As I anticipated, this is a very complicated clamp setup. Ron sets each clamp in position, then tightens the screw handle to just the perfect amount of pressure. When he’s done, I ask him how long it took. “With prep for clamping? That took a good hour. Milling walnut took about half an hour. This is the second top blank, and it went better than the first. The edge on the first cracked and I had to rip it off and start over. All morning, and I just have two done.” I take a good look at the first top piece, which is still in clamps. It’s going to take him much of the day to do this operation. I saw a machine at Eurofurn do a similar operation in a couple of minutes. I should qualify that statement. A machine that Jens told me cost $740,000 did it in a couple of minutes. And if I borrowed the money to buy that machine and paid it back over time? Ron is still cheaper, per hour. For that much money, I can employ Ron for more than fifteen years. And he can switch from one type of product to another very easily, and make sure that the wood on every one is beautifully arranged. What he can’t do is turn out hundreds of tops a day. If we need to build tops that fast, I’ll have to find a better method than the one he’s using right now.

  Over the next couple of days, Ron completes the prototype. The removable panel in the base is very tricky. It needs to fit precisely into the opening in the base. Even a tiny fraction of an inch too wide, the latches won’t work. Ron completes it in two days after the top is finished.

  My shop drawings show a hole in this panel that can be used to get a grip on it. Without the hole, there’s no indication that the panel comes off, and no place to grip and pull it. Ron has cut the panel to exactly the right size. He has mounted the hardware and pressed the panel in place. Then he comes to get me. All three panels—two permanently glued, one removable—present a smooth, unbroken surface. No gaps anywhere between the panels and the solid pieces that make up the sharper corners of the base. A triumph of craftsmanship. But I can’t tell which panel will open. The hole at the top of the removable panel is invisible unless I get down on my knees to look for it. Hmmm. Nobody is going to do that. You should be able to look at this base from a standing position and, at a glance, know what to do and how to do it. I ask Ron how well the latches work. He smirks. “Try it.” I have to put a lot of oomph in exactly the right place to pop the panel off. And when it finally releases, I have been pulling so hard that I nearly fall over backward. Ron’s smiling with his special “this is a stupid design, even though I built it perfectly” face.

  “OK, we need to make this easier to operate. I’ll get Andy to find different hardware. I want enough of a gap to show that the panel is removable. And we can add a notch to the base behind the panel so that we can get fingers behind it to pull. That should do it.” These modifications make it much easier to remove the panel. It would work even better with another hole or a knob at the bottom of the panel, but that will clutter up the clean surfaces that Eurofurn loves.

  The hatches that cover the power/data ports on the tabletop are also problematic. In Germany, they use a small, sleek, precise hinge and have custom machines to cut the special holes required. Those hinge cutters cost fifteen hundred dollars each, and you need two of them to cut left and right holes. The hinges we’ve chosen don’t require special equipment and they are invisible when the hatch is closed, giving us that very clean, very sleek Eurofurn look. But when opened, the hinges are quite prominent. Our solution isn’t as elegant as the German hinges, but we’ve shown what we intend to do in our shop drawings. And they approved the design. Ron builds these hatches exactly as shown in the drawings. They work fine.

  I’m tired of paying good money to rent a PT Cruiser, so on Thursday I head to a local Toyota dealer—I’ll call them Automall Toyota. I got an online quote for a Prius at five hundred dollars under list price, but the dealer that sent me that quote is a hundred miles away. I thought that I’d stop by Automall and see whether they would match it. My experience is a stark contrast to Urban Toyota. A receptionist greets me immediately and a salesman is at my side within a minute. He’s about my age, about my height, slim and professional looking. His name is Steve. I tell him that I want to see the big Prius. He returns with keys within three minutes. Once we are in the car, he insists on going over the controls and draws my attention to three buttons between the two front seats that change the driving mode. Driving mode? Yes, this car can transform instantly from an eco-friendly fuel sipper to a howling rocket sled, with an intermediate step in between. We head off in the eco mode, and I recognize the sluggish golf cart that I drove the week before. Steve leans over and punches the power-mode button, and suddenly it’s an entirely different car. It handles a steep highway on-ramp without difficulty. We take it out onto the local expressway and it drives very well.

  Back in the showroom, I pull out my price quote. “Here’s an offer from WayFarAway Toyota, for the car at $27,100. I’d rather not drive a hundred miles, so if you can match this, I’ll write you a check right now.” Steve checks with the manager, and a couple of minutes later, he’s back with the paperwork. Deal.

  Automall Toyota seemed to know exactly how I wanted to shop: they clearly explained the product, showed some flexibility on the price, didn’t waste my time, and got my money. I picked up my new car the next day. Could I have gotten an even better price? Maybe. But I like to buy things, enjoy them, and not look back. I’m still wondering why Urban Toyota didn’t seem interested in my business. Oh well, their loss.

  My sister solves the minivan problem. She’s selling her 2009 Sienna. My nephew is just starting college, and she can’t handle tuition bills and a car payment at the same time. She wants $14,000. Done. Solving my car problem cost me $44,000. I still have $34,000 to live on for the rest of the year. As long as Peter doesn’t start college in the fall, I’ll be OK.

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  MY MONTHLY VISTAGE meeting falls on Tuesday, May 15. We all start the session at a whiteboard, giving scores for both our personal life and business prospects. We’re using a scale from 1 (suicidal) to 10 (euphoric). I can give myself a reasonable personal score, but how should I rate my business?

  It’s a tough question. I’m trying to organize an unruly set of facts into a coherent story. This narrative needs to be both an assessment and a prediction, combining recent events with what I think will come next. I have all kinds of material to work with, but my mind returns consistently to a number of distressing trends. Inquiries seem to be drying up. Halfway through May, and we have booked just $71,321 in new orders. We stand at $787,550 for the year, far behind my target of $900,000 for this date. The Germans think I’m special, but they also told me that Europe is suffering from a dismal economy. And the newspapers tell me that the United States might be headed for another recession. We sell to a very wide range of customers, and every day Google tells me that thousands of people search for our product. Where are they? Who are the people who might have clicked, might have called, might have bought, but didn’t? What changed their minds? Am I about to become victim to another crash? As in 2008, I don’t have a lot of money on hand, and can’t expect much more in the near future. I don’t have a pipeline full of orders. I survived the last crash by laying off workers and cutting everyone else’s pay. I’m not sure that I have the stomach to go through it again, and I’m not sure that we’ll survive another down cycle. I rate my business prospects: three out of ten. My score is by far the lowest one on the board.

  We’re all sitting around one large table. Ed Curry asks each person to give a brief statement about the score they have given themselves, adding whatever detail they wish. As it happens, I’m one of the last to speak. Business scores for everyone else range from seven to nine. Orders are coming in. Nobody else is crying doom or seeing sal
es slowing down. When it’s my turn, I give a recap of my situation and explain my theory that, as a broad indicator of business confidence and activity, my business is the canary in a coal mine. Inquiries are falling because fewer people are shopping. Sales are falling because those who do shop are choosing cheaper options. Everyone’s pulling back on spending. Get ready! Rough water ahead!

  No heads are nodding in agreement. Keith DiMarino, who owns a company that stores and shreds documents, raises his hand. Over the months, his advice has been blunt but intelligent and on point. “Let’s start with one thing,” he says. “Whatever is going on here is your fault. You did something. I don’t want to hear any more whining about the big world collapsing and poor me being a victim. I don’t see it. Nobody else sees it. You have done something to make things slow down. Even if your story is true, and we’re all doomed, it doesn’t matter. You have to fix it. It’s your problem. You. Stop complaining and get started.” This is not what I want to hear, but nobody else has different advice. Further discussion focuses on what I might have done to mess up my marketing. I don’t know what to tell them. I haven’t made any changes since early March. Our Web marketing is working fine—page views are steady, within the same range that they have been for the last year. But incoming calls and sales are collapsing.

  As I leave, Sam Saxton pulls me aside. “You have to call my sales guy. He’ll help you. Just call him, have a meeting, see what you think.” I remember that Sam had urged me at the last meeting to call the consultant, but somehow, between Germany and everything else, I haven’t done it. I’ve never hired a consultant before. But Keith told me to start fixing things. The next morning, I call Bob Waks. We arrange for him to come out to the shop on the twenty-third.

  I don’t find time to look at my marketing until Saturday. On the weekends, the shop and office are quiet. I want to think everything through, and this requires focus.

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  OUR MARKETING EFFORT, in its entirety, consists of four interacting efforts. First is product development, the group of things that we offer for sale. Second: the Web site, which presents our offerings to the world. Third: Google, both free search results and AdWords, which directs people to our Web site. Fourth: the sales department, which responds to each inquiry with a proposal. I’ve made no changes to this overall structure since 2009, when I launched a new Web site. So if I did something to degrade our marketing, it must have been on a smaller scale. So which effort is the most variable? Where should I start looking?

  The problem is that I’ve tinkered with all of them for years. I constantly develop new table designs, photograph them, and put them up on the Web. Google makes note of these changes in some mysterious way and then shows our site in a better or worse position. We have settled on a basic game plan to respond to incoming calls, but Nick, Dan, and I each have different design ideas, writing skills, and graphic sensibilities. I don’t always have time to review what they send out. And nobody looks over my shoulder. Any one of us could be losing sales without knowing why.

  I decide to start with Google. I have access to enormous amounts of data, in both AdWords, which looks at my paid search results, and in Google Analytics, which looks at all aspects of site performance. I log in and start looking through both sites. They are bewildering. Google’s interface allows me to examine every possible aspect of my campaigns in multiple ways. There are statistics, graphs, change records, hundreds of links to rearrange the view this way and that, pop-up screens with more information, little warnings and suggestions, modeling tools to game alternate scenarios, et cetera, et cetera. If there’s a malfunction hiding in all that, it’s not obvious where and what it might be.

  AdWords serves my ads each day, at a wide range of costs for each click, until my daily budget—$450—runs out. It’s not clear exactly what time that will happen, as the cost of each click is dependent on a bunch of variables. Google shows my ads about sixty-five hundred times a day, and from that we are getting about a hundred clicks. Only a couple of the clickers contact us—our average for the past two weeks has been two calls a day. A year ago, the same inputs were producing 3.2 calls a day, and our sales were much better. Nothing I can see tells me what’s different this time.

  I have fifty-eight ad groups, each serving a different ad tailored to a set of similar keywords, 403 in all. Each of these ad groups behaves differently. Some get a lot of traffic, but a very low percentage of viewers click my ad. Some are the opposite. I can’t tell which ad groups prompt the most calls, e-mails, and sales. When I’ve asked people which ad they saw initially, nobody seems to remember. And since we don’t sell directly from the Web site, the answer to this question isn’t in any of this data. I can see that I’m spending a lot of money on clicks and that this seems to be producing the same number of views and clicks as it did a year ago. And yet our calls and sales are dropping. Why?

  I spend a couple of hours clicking this way and that, getting more and more frustrated. There is only one consistent message from Google, delivered in a variety of ways: I should be spending more money. I am missing clicks that are available with a larger daily budget.

  What to do? If I make a bunch of changes at once, I won’t be able to tell which ones worked. And I could make things worse. I don’t put much stock in the messages recommending an increased spend. Of course Google would say that. It’s their business. If they were really trying to help me, the interface would be more user-friendly. They seem to be drowning me in facts without providing any way to make sense of it all. I head back home, still worrying.

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  MONDAY ARRIVES AND I give another honest/discouraging speech. It’s a repeat of the past two weeks: sales slow, cash disappearing, but we aren’t out of work yet, so keep going as fast as you can. After lunch, I receive a curious phone call from an office furniture dealer in California named Jim. “I’ve got your proposal for Cali Heavy Industries here,” he says. This is Dan’s job, the one his contact at Cali Heavy told him we were getting. Jim tells me, “I really like what you guys have done in this proposal and I want to find out more about your company.” I tell Jim our story, and he says, “I love this. We could use somebody like you. The big manufacturers can’t handle really large custom tables. I get stuff like that all the time, and I have to pass on it.” He promises to be back in touch if any of his projects include custom work. This could be another outlet for us, like Eurofurn, but we wouldn’t have to copy another company’s style. We could do our own work, our own way, and just sell more of it. The dealer would get a healthy cut, but if they were selling a huge amount of other furniture at their normal prices, they might accept a smaller markup on the custom jobs, so that they can offer a spectacular table as an extra incentive to their customers. This could work out well. Between Eurofurn and dealers, I could decrease my reliance on Google.

  Dan’s happy, too. “I’ve done a ton of work for Cali Heavy. I just sent them complete plans of our table. My guy says the purchase order is coming any day now.” He’s been saying that for more than a month, but sometimes it takes these big companies a while to do the paperwork.

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  AFTER EVERYONE HAS LEFT on Monday, I log in to AdWords again. Inquiries have slowed to a trickle: twelve last week, eight the week before. Then I take another look at my Google budget, the maximum amount of money that they can take from me each day. I determine this amount, along with the ad schedule. I run my ads from eight a.m. to ten p.m. Eastern time, so that they are showing on the West Coast after the end of their business day. Google shows the ad when it receives a search string that it thinks is a good match for one of the keywords I have chosen, and charges me if somebody clicks on the ad. The cost for each click varies, depending on how much I offer to pay for it, how much other advertisers want to pay Google to show their ads, and whether Google thinks my content is a good match for the original query. When the summed cost of all the clicks I receive each day exceeds my budget amount, Google sto
ps showing my ads.

  Like Saturday, Google is telling me that my budget is too low. They promise that spending more money brings in more clicks. They have a helpful tool where I can punch in different daily budgets and see how many clicks they think I will get. For instance, it might cost me five hundred dollars to get a thousand clicks, a thousand dollars to get fifteen hundred clicks, and two thousand dollars to reach 1,750 clicks.

  Google tells me that I could be getting hundreds more clicks per day if I bump my daily budget up to seven hundred dollars. But the additional clicks may not be of sufficient quality to result in additional sales. AdWords doesn’t promise that they will come at the end of the day from some previously untapped group of eager table purchasers on the West Coast, just that I will get more of them throughout the day. So who are the extra clickers? I presume they come because Google shows my ads to more people, even when the search strings aren’t such a good match for my keyword. Some number of viewers will click on anything, often by accident. That doesn’t mean that they have any interest in buying a big conference table. Google’s definition of a success is a click. They have no way of knowing if I make a sale from that click or not. Because I’ve always had concerns about whether more spending will actually get me more income, I’ve set my daily budgets at numbers that I feel I can afford, which is about 30 percent less than Google’s maximum recommended amount. That worked fine for years. But now, maybe, it doesn’t. So I decide to roll the dice and do what Google has been nagging me to do. I increase my daily spend from $450 to $650. That should get me 90 percent or more of the available clicks each day.