Nobody ever took anything off the list

"If I could get rid of one customer, this whole place would run right."

Wade said it at the cut table in a glass and glazing shop off Garfield Avenue in Duluth, a Wednesday morning, the overhead door cracked just wide enough to slide a rack through and the cold coming in with it. Against the back wall stood a frameless shower panel wrapped in blue film. It had been standing there eleven weeks, waiting on two hinges in a finish called champagne bronze.

I asked him what that customer buys. Storefront work, a couple of jobs a year, insulated units when a seal goes, and custom showers with hardware nobody stocks north of the Cities.

So I asked how many other customers had ordered a shower like that last year. He counted it out on his fingers and got to nine.

A shop that can do anything anybody asks

Nineteen people, a bit over four million a year. Wade is good at this. He will hang a storefront in weather that sends other crews home, and the general contractors call him first. What he could not tell me, sitting at his desk with the numbers open, was which of the things he sells makes him money.

Count what leaves that building in a normal month. Commercial storefront and entrances. Insulated unit replacements. Mirrors. Tabletops. Frameless showers in six hardware finishes. Glass railing, which they took up two years ago because a builder asked. An auto glass counter left over from his father. Screen repair at the back bench, mostly as a favour. Sandblasted logo panels, four a year, on a machine that runs six hours a month.

Every one of those got on the list the same way. Somebody asked, somebody said yes, standing in a doorway, without pricing it. Nothing has ever come off.

You will know your own version of this:

A new man waits most of a year before you hand him his own truck, because there are nine ways to do the work here and he has to learn all of them.

The jobs sitting longest on your board are the smallest ones, each waiting on one part from one vendor.

You still offer something because you always have, and the last three people who asked went across town to the outfit with the right equipment.

The newest thing you sell was priced off a supplier's catalogue, and nobody checked whether you had a man who could install it.

Your profit and loss has one line called sales. If somebody asked which quarter of your revenue earns nothing, you would have to guess.

The account he wanted to fire

Wade is not the first owner to hand me a name and a story, and the story is always specific. He changes the finish after the order goes in, and he wants a template on a Friday afternoon. Get shut of him and the shop breathes.

Sometimes the account is a bad one and cutting it loose is the right call. It does not give the shop back. The next builder orders off the same list, in the same finish, on the same terms, because the list is still on the wall and the answer is still yes. Nobody can order something you do not sell.

The other two moves cost more. A man hires a coordinator to look after the awkward accounts, which puts a salary against the complexity and leaves the complexity where it was. Or he adds a charge, ten percent for anything out of the ordinary, and the people who want the odd thing pay it cheerfully. The shop stays as jammed as before, with a little more margin on the jam.

Under all three sits the part Wade owns. Twenty-one years of yes, and nobody in the building whose job it was to say enough. Every line on that list was a favour once. Favours do not come with a review date.

The sales report comes out next, the mix gets named as the problem, and the cutting starts at the bottom of the page. Screens go, tabletops go, the logo panels go. That removes fourteen thousand dollars of easy revenue and not one hour of trouble. The line that eats a shop is usually a middling one, big enough to defend in a meeting and awkward enough to bleed, and it hides behind a healthy gross margin because everything it costs sits in overhead. The template visit. The second trip. The Saturday call about a hinge. None of that lands on a job sheet, and all of it lands on the shop.

What the champagne bronze showers took out of him

We priced that one line on the back of a delivery ticket. Eleven special finish showers went out last year, and every one took a second trip, two men, about three hours, because the hardware came wrong or late or the opening had moved. A thirty-one dollar shop wage costs him closer to thirty-nine by the time payroll taxes, workers' comp and insurance are on it. Those hours go down twice, once for the time and once for the storefront work the two of them came off. Four times in the year he ate a hardware set at three hundred and forty dollars, which also counts twice: he paid for it, then he bought the right one. A shade under eight thousand dollars, on a line that billed eighty-six.

The eight thousand is the small part of it. Wade sells plenty and his crews install well. Money is what that company could never make enough of, and the mix had settled that before anybody got out of bed. Nine thousand dollars of his cash stood on a shelf in the back. Hardware in finishes nobody had ordered in two years. The auto glass counter needed a calibration rig he could not fund, so he sublet every windshield and kept the phone calls. No money for a second storefront crew in a town that would have kept one busy. A company that cannot say which quarter of its work earns nothing goes on funding all four quarters the same.

The question you ask three people on their own

Leave the sales report alone for now. Start with three people who have watched this longer than you have.

Take your lead installer, whoever schedules the work, and whoever orders material. Ask each the same two questions, on their own, away from your office, in under ten minutes. Do it at the bench or in the truck. Not as a group, because in a group they fall in behind whoever speaks first, and the value of this sits in where they disagree.

The first question: which job do you hate seeing come in, and why. The second: which of the things we sell do you think makes us the most money.

Write down what they say in their own words while they are still talking, one page a person. Defend nothing. When a man tells you the shower work is a nightmare and you answer that it pays well, he stops telling you things, and not only about showers.

Friday, lay the three pages side by side.

Where all three name the same job, you have your answer, and the building has had it a while. Where they name three different lines as the moneymaker, you have learned that nobody in your company can see profit by line, yourself included. Blame nobody for that. The information has never been produced.

Then give an hour to last year's invoices. Put every one against a line, dollars and a count, nothing fancier. Most owners find two lines carrying sixty to seventy percent of the revenue and the rest of the page reading like a list of hobbies.

One decision this week, and only one. Take the line all three of them named and stop selling it new for sixty days. Finish what you have already promised. Quote nothing further. Tell whoever answers the phone exactly what to say. Sixty days will tell you two things nothing else will: whether the shop moves faster on the work you kept, and whether anybody outside the building notices.

The next request that arrives with a good customer's name on it gets one question before you answer. What does this displace. Ask what comes off the bench or off the schedule to make room, and ask it out loud in front of the man who has to make the room. If nothing comes off, you have not added a line. You have added it to somebody's Saturday.

Four ways to do the work instead of nine

Six weeks in, the change arrives as things that quit happening. The Saturday call about a hinge finish stops. The board stops carrying two jobs from three months back that are each waiting on one part. The new installer gets his own truck inside five months, because there are four ways to do the work now instead of nine.

What starts is quieter. Your storefront crew gets a full week without somebody pulling a man off it. The account grows in a month the shop did not feel busy.

Wade kept the showers. Two hardware finishes, both on the shelf, and everything else goes out as a special order with the money in front. The auto glass counter closed inside the year and the work went across town to the shop with the calibration rig. He tells me the customer he wanted to fire is no trouble at all now. The man was only ever ordering what Wade had on offer.

Product, Service, and Portfolio Management is eight statements in the Business Check-in, and this article works through most of them. The rest ask what else got onto your list and never came off, and the check-in is free and takes about ten minutes.