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Business Lessons Learned from the ‘Bad Times’

If you’ve been in this business for any length of time, say before 2005, then you likely experienced the inverted-V of the blessings, bad times, (hopefully) back-to-blessings period of the economy’s effects on your business. Hopefully through the down time, you did learn some “lessons” that helped you to rebound and ultimately become a better installer, employer, and company altogether. Here are six lessons our company learned during the “bad times."

Churches, or rather “Houses of Worship,” or HoW as our industry likes to acronym them, have become big business for a lot of AV integrators on the commercial side. With large congregations sometimes exceeding thousands and ministries that include live bands, light shows, and multi-screen video projection, they often need fairly elaborate AV systems.

The part of the country where I live is often referred to as “The Bible Belt,” and we certainly have no shortage of churches; I pass by dozens while driving to and from work. In fact, I pretty much pass dozens on my way to and from anywhere. To attract the attention of passers-by, or gather new members, or just out-church the church next to them, many like to advertise with some catchy religious-themed slogan on their reader boards out front. Every couple of days the message will change to something new and eye-grabbing like, “Know God, Know Peace. No God, No Peace,” “Honk if you love Jesus; Text while driving if you want to meet him,” “Staying in bed and shouting ‘Oh, God!’ does not constitute going to church,” or “How will you spend eternity—smoking or non-smoking?” Seriously, some of them are pretty hilarious and awesome. I imagine there is a book full of them somewhere, a veritable Jack Handey’s Deep Thoughts for church signs they cull from.

One church put up this GIANT billboard that was just so horrifyingly awesome I sometimes found myself driving out of my way just to gaze and marvel at it. It was a picture of Jesus being crucified, but this Jesus looked more like Stallone circa Rambo and Rocky with huge, blood-red text that read, “You drew First Blood! But I’ll be back!” I mean, this Jesus was *totally* ripped and cut up, his stomach rockin’ an 8-pack and looking like his preaching consisted of CrossFitting from one city to the next beating unbelievers within an inch of their lives and then asking if they had their tickets to the gun show. His Last Supper would have been like 15 skinless chicken breasts washed down with a super dose of X-Treme Creatine Muscle Blaster Fuel followed by a dessert of multiple reps of pec and lat shredding.

We even had this bit of 3D Church awesomeness spring up that I literally had to stop, make a U-turn and drive back to take a picture of:

While driving to Florida for a recent family vacation, I passed a church sign that caught my eye and really made me think. Not so much about my eternal soul, but about the state of the custom installation industry. It read, “The good times are a blessing and the bad times are a lesson.”

For several miles after I thought about this, and it really resonated with me. And if you’ve been in this business for any length of time, say before 2005, then you likely experienced the inverted-V of the blessings, bad times, (hopefully) back-to-blessings period of the economy’s effects on your business. Hopefully through the down time, you did learn some “lessons” that helped you to rebound and ultimately become a better installer, employer, and company altogether. Here are six lessons our company learned during the “bad times”…

Branch Out
For our company, we learned that we needed to branch out. Those “sweet” home theater and housewide audio jobs weren’t just falling into our laps the way they used to and many people were turning to low-cost or DIY solutions to save money. We invested in getting our employees licensed and expanded into doing security installations. While this wasn’t the “sexy and cool” stuff that my partner and I preferred to do, it allowed us to seek new install opportunities and maximize the jobs we were doing along with offering further integration options with our automation systems. It also helped to make us more of a “one-stop shop” for builders. Plus, it brought in some recurring revenue which helped offset the down times. I know other companies branched into doing more commercial work or digital signage or other areas that expanded their reach beyond resi.

Keep Employees
When there is no work on the schedule for weeks on end, it starts to become pretty stressful on the entire staff. And, “I’m really sorry, but we just don’t have any work today,” doesn’t help your employees pay their bills. Your employees are likely your most valuable assets, and you want them to still be around when things recover. But give them too many weeks of, “Sorry, no work,” and they’ll likely be forced to go elsewhere and might not return. We decided that we were going to go to a three-day work week and that we would pay our techs for 24-hours a week whether there was any work to do or not. This gave them a chance to find some side work on a regular basis and also know that they would have a regular check to count on as long as we could keep the doors open. When things started picking back up, we went to a four-day, then back to a full work week, and were able to keep all of our staff.

Service Existing Clients
I wrote about this previously in a post titled, “Say Hello to My Little Friends!” discussing these four filing cabinets filled with years of existing clients—now five strong since that original photo. It may sound like the trite spiel of a marketing seminar, but the cheapest customer to acquire is the one that you already have. You don’t have to convince these existing clients of who you are or the caliber of work you do; they already know. Having these files enabled us to reach out to past customers and conjure up service calls by cold-calling clients we hadn’t visited in a while. “How is your system?” “Have you heard of Blu-ray or Netflix streaming?” “Oh, you just bought a new TV; do you need it wall-mounted? How about a new smart remote?” We started with “A” and just started dialing. Sure, these were small jobs, but they helped us keep the trucks on the road.

Respond Quickly to Leads
When we’re busy, it can be easy to drop the ball and not follow-up with someone as quickly as you would like. But when times were slow, we learned to strike while the iron was hot. Every phone call or message on the machine was like a lottery of, “Will this be the Big One?” When someone called, we jumped on it. “You’re interested in having some work done? Great. I can send someone right over.” This left no time for them to change their mind, call someone else, or try and do it themselves. They called, and we dispatched a truck virtually immediately. Or if it required a job spec first, we would schedule the work for the next morning.

Invest in the Company
We took a hard look at our expenses and cut whatever we didn’t need. One of the items we drastically cut in the purge was phone book advertising. The cost just no longer justified the return from the customers we had or the customers we wanted. Even my mom—MY MOM!—uses Google to search for companies. Instead we decided we needed to invest in our website as a way of driving the “modern” customer to our store. We hired a web designer and totally revamped our website, updating our look and image, increasing our exposure and presence on the Web and (hopefully) driving traffic to us. We also did a makeover on our showroom, totally repainting all of the walls, redoing displays, and giving our store a fresh, clean feel. This not only made the store look better when customers came in, but it gave everyone a more positive feel about the company and that we were taking proactive steps to improve things.

Find the Next Big Thing
While home theater and distributed audio will always be mainstays of our industry, they are a bit “played out” and increasingly becoming things people already have or can install on their own. We started asking ourselves, “What is the next ‘Wow!’ experience that we can offer to customers that they can’t get on their own and that they would be willing to invest in?” We decided this was going to be automation, and really focused on outfitting our showroom to deliver an automation experience—controlling lighting, HVAC, security, shading, and cameras with an iPad or iPhone—that helps clients to visualize the experience they could have in their own homes. Automation remains one of the things that most people would like but don’t have in their homes and something they can’t install and integrate on their own.

Unfortunately, economic downturns and other outside factors can negatively affect any business. But when these “bad things” happen, hopefully we can learn something from them that can help us to grow and have our businesses come through the other side even stronger and better prepared for the future.

John Sciacca is principal of Custom Theater and Audio in Myrtle Beach, SC.