Sharing your good fortune through time and treasure makes everyone feel good, and it can help the larger community. Tiffany Aliche shares six ways a company, a family or an individual can make a difference during the holiday season.Here’s the short list, but you’ll want to read the whole article to get links that explain how to get started. Send holiday cards to active-duty military and veterans.Collect donations for a local food bank.Volunteer at a shelter.Donate used coats and clothes.Sponsor a family (or several).Donate to Toys for Tots.Click for article

By Kristen Wright, Managing EditorTwo topics dominated education sessions during the 2016 PEI Convention at the NACS Show in Atlanta: the economy and leadership. (Find speakers' slides here.) Meanwhile on the trade show floor, exhibitors, attendees and regulators steered conversations toward tangible solutions, most notably EMV compliance and safety and corrosion research associated with ultralow sulfur diesel storage.  The EconomyPEI speaker Brian Beaulieu addressed concerns about Nov. 8, the day the U.S. will elect its 45th president: former Secretary of State and New York Sen. Hillary Clinton or billionaire Donald Trump. “No matter who the next president is, it’s not worth slitting your wrists for,” said Beaulieu, CEO of ITR Economics and chief economist for Vistage International, a global organization of more than 14,000 CEOs. “The economy will grow no matter who the next president is — at least in 2017 and 2018,” he said.Beaulieu said he expects 2017 will be a better year for U.S. businesses than 2016.“Seventeen and ’18 look good,” he said.As long as 150,000 jobs are created each month in the U.S., the U.S. economy is OK, Beaulieu said. Also, the U.S. no longer has a vested interest in the Middle East, Beaulieu said, and U.S. dependence on foreign oil is declining. In 2005, he said, the U.S. imported 60.4 percent of its oil. In 2015, that number fell to 24 percent.The first time Beaulieu expects the U.S. gross domestic product (GDP) to slip will be during the first half of 2019, he said.“How many of you are 42 or younger?” Beaulieu asked the audience. “I’ve got news for you: It’s going to suck for you.”He said that 2022 “could be nasty,” although it’s too far away to give definitive numbers. Nevertheless, the dips will not be as bad as those in 2008.“All we need is 2 percent growth, and we’re happy,” he said.Beaulieu shared predictions and tips for making the most of economic opportunities:“Specialty stores are the future.”Business opportunities abound in Mexico. “I’m very bullish on Mexico.”“If you have adult children living with you, kick them out.” The economy is good enough that young adults can do well out on their own, he said.If the U.S. stock market tanks upon a Trump election, buy. “Play the demographics, play the economics, and you can’t lose,” he said.The U.S. housing market looks good, so “buy more real estate.” Beaulieu said to buy in urban areas near water with great views.Listen to Millennials, those employees or potential employees born roughly between 1980 and 1999. Although they might not know business, Millennials know systems and processes. “Man, are they smart,” he said. “They won’t work long, but they do work hard.”Plan to be debt-free by 2030.Beaulieu said the U.S. economy looks good in the long term, but the period from 2030 to 2040 concerns him. Possible depression drivers include U.S. demographics, inflation, health care costs and other entitlements, plus the U.S. national debt.Although the U.S. has fewer functioning factories than in the past, what matters is throughput in manufacturing. Beaulieu said the U.S. will remain No. 1 in world GDP for the next 50 years — and probably the next 100 years.“We’re (the U.S.) the economic Marines of this world,” he said.PEI General Manager Rick Long echoed Beaulieu’s predictions and provided specific industry data to show trends during the PEI Membership Breakfast and Meeting.“The state of our country is strong no matter what is going on, and the same is true with PEI,” Long said.He shared results of the most recent PEI member survey that asked petroleum equipment distributors and manufacturers what was going well and what was not. Distributors said the top two things going well are EMV (25.4 percent) and construction (16.9 percent). The most disappointing thing for distributors is a technician shortage (20.1 percent).Manufacturers said the top two things going well are innovation (24 percent) and international sales (12 percent). Most disappointing for manufacturers is domestic sales (16.7 percent).Long will replace outgoing PEI Executive Vice President Robert “Bob” Renkes when Renkes retires from PEI on May 31, 2017.  Leadership“Just because you’re in the position of leader does not make you a great leader,” said Randy Disharoon, a nuclear engineer and distribution and manufacturing expert who asserts that leaders are not born; they are built.He shared four phases of leadership development: build within, build around, build up and build out. Among his tips are:Let your team drive. You be the guide.“If you’re not willing to do the least amount of work, you will not be followed.”Be replaceable, or you’ll hold back your team and yourself. A leader’s No. 1 job is to find his or her replacement.“Leaders get back what they emulate and what they tolerate.”As far as weaknesses, “If you can identify your blind spots and then improve, your effectiveness will grow 20-fold.”International business guru Troy Hazard shared leadership tips, as well, during the PEI General Session on how to future-proof a business.“Here’s what I’ve learned,” Hazard said. “I’ve learned that leadership is a science.”Hazard said that he made a couple of bad business decisions during his career.“I wasn’t creating time to create strategy,” he said. “And I wasn’t tapping into that peer network.”Hazard advises leaders to find 30 minutes each day to create strategy, even if that is only to plan that day, he said.“If you want to get fit, you go to the gym 30 minutes a day,” he said.An event unrelated to business helped Hazard find focus. He was on the race track, and his coach told him he was avoiding the accident instead of being focused on the strategy of winning the race, Hazard said.“That’s what happens in business,” he said. Upcoming PEI ConventionsThe dates have been set for the next three PEI Conventions at the NACS Show: Oct. 17-20, 2017, at McCormick Place in Chicago; Oct. 7-10, 2018, at the Las Vegas Convention Center; and Oct. 1-4, 2019, at the Georgia World Congress Center in Atlanta. 

Albert D. Bates, Profit Planning GroupAn overlooked factor in the payroll cost challenge is the inability to control operating economics. Many distributors process too many orders, and many of those orders are of too little value.A major profitability challenge facing distributors during the past decade has been the inability to lower payroll costs as a percent of sales.This challenge has continued despite new technology focused specifically on payroll, such as automated order picking, online ordering and enhanced fleet scheduling.There are several reasons for the inability to lower payroll costs. They range from escalating health care costs to a shift in the employee mix toward higher-compensated employees, especially in the information technology (IT) area.One overlooked factor in the payroll cost challenge is the inability to control operating economics. Many distributors continue to process too many orders, and a large portion of those orders are of too little value. Distributors must face this challenge directly.Let’s examine the nature of order economics from two perspectives: The nature of order economics. An analysis of how even small improvements in the average order size can yield large profit gains. Order size strategies and tactics. A discussion of the opportunities to improve the economics of a typical order.  The Nature of Order EconomicsThe figure below examines the nature of operating economics for the typical PEI member based on the latest Distributor Profitability Report (DPR) published for PEI by the Profit Planning Group. As the report indicates, the typical firm generates $10 million in revenue and processes 2,500 orders a year. The orders vary in size, but the average order value is $4,000. This is with an average of four lines per order. Each line has an individual value of $1,000.The results indicate that the typical firm is extremely productive in its warehouse, trucking and office operations. That this large workload can be handled profitably is a credit to PEI members.Firms, however, potentially could become more profitable if they could maintain high productivity while generating additional sales volume. The key involves focusing on the number of lines per order and the average order value. The result should be higher sales without additional activity or cost.When most firms think about enhancing sales, they look to increase the customer base. Although desirable, this does nothing to change the economic structure of a typical order.With more customers, firms can increase the number of orders averaging the same number of lines per order and the same order line value. Sales and payroll costs tend to move upward together.In contrast, if firms change the nature of the orders received from existing customers, they could enhance sales with only a modest increase in payroll costs. The assumption is that the same set of customers would place the same number of orders, but with some minor tweaks to order sizes. (See the Potential Results column in the figure below.)The Impact of Improved Order Economics for a Typical PEI MemberFactorCurrent ResultsPotential Results1. Number of Orders2,5002,5002. Lines per Order44.13. Order Lines Processed (1x2)10,00010,2504. Average Line Value$1,000$1,0105. Net Sales (3x4)10,000,00010,352,5006. Sales Increase % 3.5At the top, the number of orders remains the same. The first change is that the number of lines per order increases from 4 to 4.1, a modest change. The net result, though, is that the number of order lines processed increases by 250. This represents slightly more work, however, because the number of orders being processed is the same, but the increase is modest.From a strategic perspective, the 250 more lines processed means that competitors collectively are processing 250 fewer lines. It is an operational and competitive change.Finally, the average line value is increased by 1 percent, which takes the figure from $1,000 to $1,010. Again, it is a small but probably challenging change to the firm’s operations.The net result is that sales increase from $10 million to more than $10.35 million, an increase of 3.5 percent. It is not an earth-shattering number, but it is important. It represents organic sales growth that is independent of the market. It also is achieved with only a modest increase in payroll costs. Order Size Strategies, TacticsThe two keys to changing order economics significantly require developing a sophisticated information reporting system and a more action-oriented mindset. The proper information must be available, and it must be used in decision-making.Information reporting system. If a firm does not know its average lines per order or average line value, then it has no chance of improving them. It is not enough to have the information at the total firm level. The information must be accumulated and available for reviewing individual customers and individual salespeople — inside and outside sales. This is another example of big data in management. Existing technology means having such information available is no longer a major challenge.Action-oriented mindset. Collecting the information is an essential first step, and it’s not particularly difficult. Developing improvement programs based on that information is much more challenging and time-intensive. It necessitates specific approaches to improve the two order economics pressure points identified in the figure. Lines per order. Superficially,this would seem to be nothing more than a “would you like fries with that” effort. This is where information on salesperson performance comes in to play. Overtime sales people get tired, develop bad habits and fall into low-performance ruts. Continual follow-up and reinforcement is required. However, there is also a strategic component at the total firm level. Understanding the range of products that customers would like to purchase is essential. Items not in the product line can’t add to the lines per order. It also is necessary to have the items in stock on a systematic basis. Being out of stock causes the lines per order to fall to zero. Average line value. This is the more challenging of the two improvements in the figure. It also is more profitable. Customers habitually order only the quantity they need now. Getting them to buy more is a battle. By explaining to customers that placing a lot of small orders costs them more money, it is possible to help them plan and buy more less often.More impactful is to raise prices where there the opportunity exists. This cannot be an across-the-board activity. In every business, there is the potential for modest price increases on slower-selling items. Eventually these small changes add up. Moving ForwardTechnology is important in helping control payroll costs. Technology alone never will produce meaningful changes, though. The key to controlling costs is to consistently review order economics.Albert D. Bates, Ph.D., is founder and president of Profit Planning Group. He is the author of the newly released “Breaking Down the Profit Barriers in Distribution” available through Amazon and Barnes & Noble.

Ever experience a professional social situation that left people in your group casting sideways glances or mouthing "awk-ward"?"Unfortunately," writes Jacquelyn Smith, "many people wind up making fools of themselves because they don’t understand that etiquette rules in business differ from those in other settings."So tuck these tips into your mental pocket before your next meeting or conference. (By the way, the PEI Conference at the NACS Show is Oct. 18-21.)Click for article  

Fred Yager, DiceAs much as 80 percent of employee turnover is attributed to bad hiring decisions.Click for full article Tips for better hires (summary):Know what you want.Look for intangibles.Make a personal connection.Use all your resources.Woo your top choices.