December '22

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3 4 G R A P H I C S P R O • D E C E M B E R 2 0 2 2 G R A P H I C S - P R O. C O M A W A R D S & C U S T O M I Z A T I O N MAKING MOVES DURING INFLATION FOLLOW THESE STEPS TO PREPARE YOUR BUSINESS FOR INFLATION M A K I N G S H O P M O V E S | H O W A R D P O T T E R I nflation, as we know, has been on the rise over the past three to five years, and depending on where your compa- ny is, you can feel it more than others. With our company being in New York, we get to see it move much quicker at times due to consistent minimum wage hikes, mandated paid personal time off, massive comp rate hikes, state fees, and more. So, over the years we have had to learn to be creative with not only our finances, but buying products/supplies, investing, and how we go about increasing pricing. Why am I informing you of all of this? Because it is something you should be working on right now! FINANCES You always want to look at your finances first. Make sure you have your hardcore numbers and that they are up to date, along with figuring out your cash flow to keep you ahead of any curve. Once I know our numbers are all in for the period, I can start looking at our profit and loss statement and examine each line item to see where we had abnormal spending and why. Then I can create a list of where we can save going into the next year, but I also keep an eye out if we need to increase the budget for spending on that line item as well. You always want to project worst-case num- bers and not the best-case. If you work with the worst-case numbers, you are always giving yourself a buffer, and if you have to be tight on certain spending, you can do as needed. As I go through each line, I am also looking for ways to im- prove our spending, who it is with, etc. Once I have made it through the P&L, I have a total and know what my worst- case savings are if I hit the same sales as this year. I never count on growth — even though we grow by a minimum of 15% to 20% and are close to 50% this year. Growth is never a guarantee, so never bank on it! PAYROLL The next thing I work on is payroll numbers. I am look- ing at the number of staff, overtime, turnover rate, and cost of hiring new staff. When studying these numbers over the years, we have come up with ways to help improve our pro- duction and build morale while being cost-effective. One example is to create a four-day workweek (as much as pos- sible). This gets you 10 hours' worth of work daily instead of eight hours, and if you do need the employ- ee for overtime, they still get the weekend, and if not, they get a three-day weekend — which they all love to have and is a win/win for both. Once I have gone through each line of how we can improve by lowering our overtime, investing in hiring, and getting our hardline numbers for where we can save, I will project worst-case pay increases with taxes and benefit increases to get a whole number to work with. Another way to help offset your costs for pay- roll each year is to determine what time of the year you give your increases. We started giving all reviews and pay increases at the same time a couple of years ago, which not only makes it easy on management but helps offset the initial costs. It is a two-prong plan. Once we know our pricing increases, etc. (which we are done with in October), we implement them on the first of November. This gives us a five-month buffer to build more revenue before we do reviews at the end of March. And their pay increases start on the first pay period of April, which gives our Pay attention to your payroll numbers. I am looking at the number of staff, overtime, turnover rate, and the cost to hire new staff. Images courtesy Howard Potter.

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