Garage door industry magazine for garage door dealers, garage door manufacturers, garage door distributors, garage door installers, loading docks, garage door operators and openers, gates, and tools for the door industry.
Issue link: https://idoi.epubxp.com/i/255259
50 International Door & Operator Industry™ For example, the two service segments (commercial and residential) have combined to contribute over 31.0% of the total Gross Margin, from only 21.5% of total sales. Conversely, garage doors installed in new residential construction represent 14.0% of the volume but contribute only 3.3% of total Gross Margin (worse yet, that 3.3% contribution ties-up over one- third of the frm's working capital, but that data is not part of this discussion). Indeed the bleak results of the new residential segment may cause management to discuss even continuing to market that product. It is also worth noting that labor effciency is greater for commercial rolling doors than for commercial sectional doors, and the high COMU for the window and entry door segment indicates that some alternative vendor analysis may be in order. Residential retroft appears to be the core segment in terms of activity and performance, thus marketing expenditures for showroom updating and identifying new homeowner leads are evidently being applied wisely. Gross Margin … Some Concluding Thoughts In this two-part series on the topic of margin we have explored both the calculation and the implications of the subject, and it remains clear that few items are as central to a frm's success as is the maintenance of adequate Gross Margin. Most business success is directly attributable to fnding a market opportunity that will yield suffcient margins to justify the capital required to exploit the opportunity. Likewise, much business failure is the direct result of cost/price relationships that do not produce suffcient margins to support the scale of operations. We have made the point that correctly determined Gross Margins are critical to structuring and orienting the frm's business model, and to providing data from which management can strategize for expansion and growth. We have heard some dealers protest, "… we don't have a business model we just sell garage doors." Therein lies a major managerial problem: If you do not have a consciously organized business model, including sound margin targets and disciplined data retrieval, you may be randomly reacting to short-lived opportunities without a strategy for survival. Understanding and appreciating Gross Margin, and knowing how to improve margins through effciency, market positioning and product development is at the heart of all business success. MANAGEMENT (continued from page 49) John E. Zoller and David H. Bowen comprise Zoller Consulting, Inc. of Wooster, Ohio. Zoller Consulting provides consultation of managerial effectiveness and fnancial performance of construction related businesses. They also offer customized seminars and training sessions. In addition, Zoller Consulting provides acquisition management, including fnding buyers or sellers, locating funding sources, transaction structuring, and negotiating and organizing the transition to new ownership. Contact Zoller Consulting, Inc. at 330.262.8500 or John@zollerconsultinginc.com. If you're like most dealers, searching for ways to increase prots and make more money is a constant mission. The 2014 IDAExpo workshop toolbox will feature industry nancial specialists and workshop leaders John Zoller and Dr. David Bowen. Visit IDAExpo.org for more information. I have good news. Your search has ended. Ms. Ida IDA spokesperson Your Toolbox for Success I D A M e M b e r S e r v I c e : DANGer. DO NOT OPerATe. These hang tags are for dealers to use when a garage ags come complete with wires. Available for New York, California, Minnesota and generic (for Indiana and all other states). DANGer: DO NOT OPerATe! NOT UL 325 cOMPLIANT. These hang tags are for dealers to use ot meet a ags come complete with wires. Hang Tags www.doors.org Use the in-magazine order form or order online under Member Services at: 1/28/14 3:19 PM