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Many companies are currently experiencing a significant lag in sales volume. Unfortunately, there is little news on the horizon to indicate that this is a short-term event that will reverse anytime soon. So — unless you want to continue to ride the train downhill with the obvious results — you need to make some changes in how you are doing business and where you focus your efforts.

If your sales are declining, it is obvious that what you are offering to the market is appealing to a declining group of customers. Reducing price likely isn’t the answer — the customers are not in the market and by you trying to attract business by giving away margin only further erodes your profits.

Your product design efforts hold potential for accessing new markets. Rather than trying to increase market share in your currently declining market — go find new markets.

LOOK BEYOND THE HERD

Economic downturns tend to impact sales more in the low- and middle-price ranges and less so in the higher priced products. Often, mid-level producers will look at these lower markets as offering them expanded market potential. Those markets are already over capacity — why move in with the herd? If your products focus more on the mid- or lower-price points, this might be a good time to look at introducing products into the more stable higher end market.

This market shift might be as simple as offering your standard product line in higher grade veneered plywood and upgraded finishes with a more extensive offering of options and accessories. These are changes that can often be accomplished with little or no additional capital, while allowing you to access a more affluent customer base.

Be smart in how you approach this new market. If your designers add numerous upgraded accessories which will be purchased, be aggressive in your stocking approach to those items; minimize your stock until you see what is selling. A few extra cents/item is far preferable than a shelf full of obsolete inventory. Better yet — ask your vendors for consignment programs.

Keep in mind that aiming at a higher priced market might require that you also make changes in your marketing efforts and dealer networks.

LEVERAGING YOUR OWN STRENGTHS

Manufacturers of store fixtures and commercial building interiors often have input into construction detail of your products, which allows you to manage the final design to best suit your manufacturing capabilities and thus your competitiveness. Be certain that your designers are intimately aware of not only your own unique strengths but the capabilities of your competitors. A good design team can go a long way in winning that competitive war by leveraging your strengths and your competitor’s weaknesses.

Be innovative. Making it the way you always have — and the same as everyone else does — condemns you to be just another fish in the pond. When the only advantage you can bring to the table is a lower price, it likely comes with lower margin. Work with your customers and designers to incorporate alternative methods, materials or processes that reduce cost, increase value and differentiate you from your competitors.

Always be on the lookout for new hardware that can reduce assembly or installation times —or bring that little extra to the customer that makes a difference.