I am one of those people who loves to reflect on the old year and project for the new. But it’s mid-January and although we’re pretty much finished talking about resolutions, it still is a good time to take stock.

Yes, it’s a good time to look at your business and your goals. And it’s also a good time to literally take stock. You likely have a list of inventory on hand, but have you been paying attention to what’s selling? Which SKUs are making money? When was the last time you looked at the fast moving inventory report?

Now is the time to get rid of your dead weight and replace it with new, better or different inventory. If it didn’t sell over the holidays, it’s unlikely to become suddenly popular during the doldrums of winter. Liquidate the items that aren’t moving. Turn those assets into money. Use that money to promote your website and sell your fast movers.

Whether you outsource your order fulfillment or keep it in house, slow moving inventory is costing you money. Not only is your capital tied up in inventory, one way or another you are paying for warehousing (even if your order fulfillment company is giving it to you for “free”) and the duds are taking up real estate on your webiste.

Starting the New Year by being realistic about your stock help you channel your energy and money for growth. And isn’t that what we are all in business to do?

“I work harder than everyone else. Plus, I’m loyal. I’ve been here forever. Why am I not paid more than the others?”

For a manager or business owner, conversations about hourly compensation are perhaps the most dreaded of all discussions. For many people, their personal self-worth is inextricably linked to their paycheck. Some people believe that they should make more money than others because they've been employed for a longer period of time. Others may argue that because they have more responsibility, their compensation should be higher. Then, there are those who believe that because they perform their duties better than others, they deserve a higher rate of pay. The very idea that the job they’re doing has limited upside, regardless of loyalty, tenure or job quality is very troubling.

In an integrated order fulfillment and call center the issue of hourly compensation takes on another dimension. The two divisions do very different work. It’s not uncommon for the staff in the distribution center to think that they work harder, as their work is physical. After all, how hard could it be to sit in a call center all day? Meanwhile, the call center associates sometimes wonder if the “heavy lifters” in the fulfillment center have the mental horse power to power up a computer.

Our company recently underwent a thorough review of its compensation philosophy. In a nutshell, we needed to remove the ambiguities and subjective measures that had crept into our comp plans. We had to objectively measure the jobs being done and we had to provide our employees with a clear path for advancement.

After a great deal of research and discussion, the management team decided upon three integrated systems of performance measurement. The new system assigns a point value for each measurement. When the three point values are tallied they match a dollar value on an hourly wage matrix. The three measurements we used are:

1) Skill: The ability to perform a task or multiple tasks. The more you are able to do, the greater the reward;
2) Scope: The depth and breadth of knowledge and responsibility;
3) Overall Performance: How well you are able to perform based on the metrics set for your position, reviewed quarterly through performance evaluations.

At a recent quarterly meeting, the new system was explained and the floor was opened for questions. The room was quiet. While we reassured our team that over 90% of our employees would see an increase in their pay under the new system, no one offered a peep. Change is anxiety provoking.

In the week that followed, our management team individually met with all of our employees and carefully went over the new system. While the handful of people whose pay was reduced weren’t happy about their pay decrease, they agreed that the adjustment was fair (most had moved down from one position to another, but retained the higher rate of pay).

In the end, the change was successful. Our staff is relieved to know exactly how they are measured. The system is easily understood and provides a clear path for advancement. Most importantly, our staff believes in it’s fairmess. For management, there is relief that we’ve moved beyond ambiguous measures and subjective systems. Our system shows that we value excellence across several categories and that we’ll pay for it. A win-win.

Written by Thomas E. Unterseher, CEO and Stewart Buskirk, VP of IT

Marketplaces like EBay or Amazon offer a solution to the most fundamental problem of new online businesses – how to put their products and services in front of potential customers at minimal cost. Just like real marketplaces, however, these online channels offer limited opportunities to develop a customer base that is loyal to you rather than to the venue.

Faced with increasing fees and eager for new growth, many marketplace sellers would like to open up new channels for their products, but find creating an entire online presence either dauntingly complex or unaffordable. But there are steps you can take today to lay the groundwork for breaking away from the marketplace and start creating direct connections between you and your customers.

Pay attention to your product packaging and final presentation to the customer after the sale is complete. If you sell a service, make sure you send a warm, professional welcome message reminding the buyer of the smart decision they just made and how to maximize its value. If you sell a shipped product, remember that receiving and opening that package may be your best (and last) opportunity to make a great impression.

If you outsource your shipping or use a drop shipper, ensure that you can include a packing slip that prominently displays your logo or name. Don't settle for a generic packing slip with cryptic barcodes plastered all over it – your packing slip should confirm the details of the purchase, list any separately shipped items, return policies, your web site address, and provide a place for gift messages or other customizations.

Put marketing materials or memorable inclusions in your packages. Most outsourcers will drop inserts or catalogs into your outgoing shipments for a reduced price – this is a great way to get a mailer, promotional coupon or offer into your customers' hands without additional shipping costs. One retailer drops a small stuffed dinosaur into every package. The item costs him very little, but serves as great packing material and definitely makes his deliveries memorable!

If you ship USPS Priority Mail and meet their volume qualifications, you can even get free boxes from the USPS for your shipments with your custom design or text printed on the outside of the box. This is an incredible deal for those who can take advantage of it and even if you can't do it on your own, you may be able to find a third party fulfillment shop that would be glad to “sponsor” you with the USPS.

Understand that every communication with your customers is an opportunity to establish and strengthen their perception of you as a brand and a trusted source. Whatever direction you take your business, taking every opportunity available to connect with your customers as a brand identity rather than an anonymous “seller” in a marketplace will give you a head start on breaking away from the pack.

How do you choose an order fulfillment company when they all seem so similar? The most telling insight into the soul of a fulfillment house may be how they handle receiving.

A successful fulfillment center – whether in-house our outsourced – begins with good data. And that good data must be captured at the onset of the process, in receiving.

Receiving is where accuracy begins. It’s where you get a chance to verify that your supplier shipped the same number of units you purchased. It’s where damaged items are discovered and incorrect colors and sizes are found. It’s where quality assurance happens.

When playing the pricing game, some outsourced fulfillment services offer “Free Receiving,” while others charge for receiving. What’s the better value?

Ask the fulfillment company what they include in receiving? Do they insist on a high level of accuracy or do they simply verify the number of pallets received? What happens if you find out down the road that there was an error in receiving or the supplier sent the wrong quantity? Who is responsible for making that right? And how do you handle the orders that were affected by shipping incorrect inventory or backorders?

If free simply buys you a pallet count and taking the supplier’s word for it, then you’ll need the Q/A steps described above done at a later date.

Receiving is a garbage in – garbage out proposition. If the wrong items find their way to inventory, they’ll then find their way to your customer. And that’s where the real cost begins – errors and unhappy customers. Either way, you decide when you want to pay.

It seems fitting to post my first blog entry the day after an election. Change is in the air and inspiration is palpable!

Who am I?

Heather Bohr. Entrepreneur. Mother of 3. Fluent in Mandarin and Spanish. In business with my husband Thomas Unterseher. We co-founded OWD 12 years ago. OWD offers order fulfillment and call center services to big and small companies selling mostly business to consumer.

Because we work closely with 70 clients, we have always felt like we were in a unique position to glean important information about business in general. Over the past decade we have seen businesses thrive and businesses fail. We are privy to overall trends, see the effects of certain marketing decisions and watch our clients face their business challenges. We get to look through the window at what works and what doesn’t.

Then of course we have our own business to grow. Employee issues, marketing, budget concerns and business decisions, for better or worse.

So, why the blog?

I’ll be blogging about business – my business, sharing my observations about the businesses we serve (names omitted), and trying to give food for thought. Growing a business is challenging and if I can help other businesses along the way, then that’s what I’d like to do.

I’d love to encourage a conversation, questions, discussion about business in general. Please leave comments or feel free to email me at heather@owd.com.