Helping Workers Understand Your Business Benefits All Parties

Put aside your personal politics for a minute. Does any of the heated dialog of the past couple months bother you as a businessperson or the owner of a multichannel company? It bothers me because there is so much misleading information and even fake news. We’re badly in need of better information and better filters.

In similar fashion we need to do much more to continually educate employees on sales drivers and profitability for our businesses and industry. No, it doesn’t mean we have to share details about P&Ls.

Here are three specifics to make my point:

  • State tax abatement to save jobs
  • Outsourcing
  • Imported product

State of Indiana and Carrier Corp: I guess what perplexes me most is how little people understand about the ways private business can work with federal, state and local government to create jobs, making solid investments that are a win-win for all parties. We have all heard in recent weeks about the Indiana-Carrier deal saving somewhere between 800-1,100 jobs in Indianapolis. The unfortunate part is that many jobs could not be saved as it was too late in the process.

From what I can tell, I don’t see these kinds of deals being different from my clients negotiating for investment in headquarters, fulfillment centers and call centers in MOST states. Some states like North Carolina and Virginia may be more aggressive than others to gain jobs. But even New York has become very aggressive with tax abatement for up to 10 years.

However, I felt a very important factor was left out. How do the everyday expenditures of those workers benefit others in the community? Suppose each dollar turns in the Indianapolis economy three times? Think of all the retailers and service providers that gain revenue, profit and can feed their families, everything from banks to apartment complexes to grocery stores, florists and car dealers.

Outsourcing: Many companies outsource contact center operations for off-hours coverage and for some it’s their primary method. Others outsource their fulfillment operations. Some, especially in financial services, outsource offshore and save considerable expenses. If you use outsourcing it’s important for employees to understand the cost savings and benefits. We need to tell the business story better.


Imported Product: Much has been made about Trump’s ties and shirts being manufactured and imported rather than manufactured here. I find this very curious. If it wasn’t for offshore sourcing many businesses would not exist including Walmart and Target. Or they would but consumers would pay much higher prices.

Where am I going with this? I think it’s in our best interests as multichannel managers and owners to continually educate managers and employees about the drivers of sales and profit. As we invest in new or remodeled facilities, process improvement and technology, we need to clearly communicate the business benefits to our employees.

Here are two ways to start:

Company Profitability: Start out at a high level if you’re not doing this already. What are the major financial ratios for your business? How is gross demand eroded by returns and cancellations? How do you reduce it? What is your gross margin and its components? Why does it take a markup of 50% to 60% in many businesses to cover the major costs of marketing, contact centers, fulfillment, outbound shipping and G&A costs?

Everybody hears about how healthcare costs more, and employees are certainly shouldering their share. How are you communicating what you spend on this and other benefits? Share a highly summarized version of your long-term P&L. Talk about performance against 2016 budget and goals for 2017. I believe we can empower employees once they understand our goals and how things work.

Achieving Higher Productivity: I believe most employees want to deliver for you once they understand your production goals. How do your operational metrics stack up against other multichannel companies?

In an exclusive joint project, Multichannel Merchant and F. Curtis Barry & Company have teamed up to develop an industry benchmarking report that will focus on key performance metrics and costs across fulfillment center, contact center and inventory management. This research will be developed in cooperation with executives from leading multichannel companies of all sizes.

The results of this exclusive research project will be presented and discussed on March 28, 2017 at the Executive Operations Forum at Operations Summit in Pittsburgh. Only those merchant companies providing data to the benchmarking survey – which you can access here – will receive the detailed, by-company benchmarking report. Nothing needs to be done until after Jan. 1, and survey data collection will remain open until Jan. 31. The more of you who take part, the more valuable the results.

Curt Barry is Founder and President of F. Curtis Barry & Company

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