Happy New Year! As promised, our New Year’s Resolutions for 2017. Trump promises to have a more business oriented perspective than prior administrations.  We will leverage this to benefit our businesses. We are going to take a different tack this year to get our readership to jump on board early to gain a financial advantage. The economy is running warm right now the markets are rising we will strike while the iron is hot.

2017 Resolutions

Utilize Section 179 Deductions
Now is the time to look at Section 179 qualifying purchases that can bring money back to the company. Trump is famous for his tax write-offs and some rumors have it that Trump will double the Section 179 write-offs. Regardless of whether he does The "Protecting Americans from Tax Hikes Act of 2015" (PATH Act) that was passed last year allows up to $500,000 in write offs for eligible investment, removed most of the AMT restrictions, and includes most business software. 

Resolve to invest in business improvement early in the year.  Many companies get trapped in a cycle of waiting until it is too late to research, plan and implement a solution that will improve their business, then spending money at year-end on a band-aid or letting the deductions go unused.  I always sent reminders about the Section 179 spending at year end, this year we'll work together to keep it at the forefront.

Get Help Reconciling Inventory
I’ve talked about Inventory Control, managing your biggest asset, enough times to sound like a broken record.  Food distributors I visit often report they constantly take inventory by hand because they don't have or don't trust the perpetual numbers their the system gives them. Some take it daily and some take it weekly, but the labor spent on that function is enormous.

Resolve to automate inventory reconciliation, and holding employees accountable is the key.  Most companies can bring 10% of inventory value back to their bottom line by automating and improving the techniques they use to reconcile their counts against a perptually maintained inventory figure.

Improve Employee productivity
The chart below shows the current unemployment rate in the US is the lowest since “The Great Recession”.


 
A large percentage of labor at the warehouse level is paid just above minimum wage, attracting high school graduates or those with less formal education. These are hard working people, but getting more productivity from that group can be challenging. In addition, as you grow with the economy attracting qualified people will be more difficult because the labor pool is reduced because of the employment environment.

As we explored in "Are you at your best?", implementing processes that employ repeatable best practices can take the lowest level of employee and make them more productive. We don’t want to eliminate labor. We want make sure that the labor we pay for is leveraged to contribute as much productivity as possible.

The current trend in major manufacturing plants is the infusion of robotics to make labor more productive. A good example is the automated technology meat cutters use such as steak slicers and auto Cryovac systems they are a great example of repeatable steps done by a machine for uniform and more productive work.

Resolve to invest in repeatable best practices for your warehouse and office employee productivity the same way you would automate production functions or invest in improved equipment.

The beauty of these three resolutions is that they are complementary and focusing on one can affect the others just through the process. Pick your projects early and bring more productivity to help the growth of your firm.

As I promised very simple and straight forward, for 2017.

  • Utilize Section 179 Deductions
  • Get Help Reconciling Inventory
  • Improve Employee Productivity

 

 

Issue 646 - Checking those Resolutions.

Last year we were early to declare our New Years Resolutions 2018. A lot has changed over in 2018, but I believe it's not quite too late to make sure we have addressed some of those resolutions.

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