Author - Robert Coolidge

Business Not As Usual

What’s Next for Repair Service Following COVID-19

 After enduring weeks of “stay-at-home” orders to contain the COVID-19 pandemic, most states are reopening businesses previously deemed non-essential. However, with the virus still circulating and causing severe illness and death, business is anything but usual.

Personal protection items like masks and gloves have become standard issue for restaurants, hair salons and other industries where personal contact with customers is the norm. The same goes for service providers who must enter homes to make repairs and interact with customers.

As we continue emerging from this unprecedented event, the long-term impact on the service repair industry is still yet to be realized. Some repair businesses have been forced to shut down permanently. With time on their hands and access to a wealth of “how to” videos online, there has been a sharp increase in consumer DIY repairs.

Adding to the mix of factors driving DIY repairs is an unemployment rate rivaling percentages not seen since the Great Depression of the 1930s. Retail stores are slowly opening across the country, but some powerhouse brands such as J.C. Penney, Neiman Marcus and J. Crew have filed for bankruptcy in the midst of the crisis. Industry projections for major appliance and electronics production and sales have dropped for at least the remainder of 2020.

Still, despite this challenging market environment, there is considerable opportunity for service businesses. Numerous complex repairs are way beyond the basic capabilities of a general DIY consumer. Anything to do with electrical wiring and circuitry, for example, is best left to the professionals.

In a down economy, demand for repair typically surges as consumers put off replacing big ticket household items. Plus, as restaurants closed and now operate in some states with capacity restrictions, consumers have been using their major kitchen appliances more than ever, raising the risk of breakdowns. Consumer need for professional repair service could ultimately outpace the availability of service providers – and perhaps enable higher rate charges. However, with decreased model production comes decreased parts production so it may become harder to find some necessary repair components.

Some repair providers have rapidly adjusted to the new normal and are getting creative with such service offerings as virtual estimates and troubleshooting that limit customer contact.  Contactless measures are likely to continue – and expand – even after the current pandemic abates.

If nothing else, COVID-19 has been a dramatic wakeup call to the world and the repair industry. And if the experts are correct, this is not the last time the world will face a similarly impactful pandemic.  Businesses must evaluate their existing response strategy and develop best practices for managing through the next crisis. Those able to adapt under the most challenging conditions will survive, and even thrive, while others risk becoming just another impact statistic.

Encompass Response to Coronavirus

Updated April 21, 2020

Message from Encompass President & CEO Robert Coolidge

Encompass has been closely monitoring the global impact of the coronavirus (COVID-19) pandemic since it first originated in China. Our heartfelt condolences are with all those who have been sickened and died from this terrible illness. Please click here for a helpful pamphlet on Preventing the Spread of Respiratory Diseases from the Center for Disease Control and Prevention.

Internal Response

Although all Encompass facilities are operating regular schedules, we have taken several precautions for the health and well-being of both our associates and business partners. We are following all government guidance and mandates to help contain the pandemic. Some measures we have taken include:

  • Office staff are telecommuting until further notice. Encompass is equipped with cloud-based systems, ensuring continuous communications both internally and with our customers. 
  • Essential on-site staff are required to wear masks and gloves and are also being provided antiseptic wipes and hand sanitizer at work stations and common areas. More importantly, they are mandated to frequently wash hands.
  • Staff travel is restricted.

Parts Supply Continuity

Due to the expected closings of factories during the January Chinese New Year, our Purchasing team had procured safety stock for the select brands for which we source directly overseas. At this time, highest demand parts remain in stock across multiple product verticals, including Home Appliance and Consumer Electronics. However, the team is in daily contact with manufacturers to identify any supply disruptions so we can then communicate with our customers.

Encompass has no immediate plans to close facilities and will continue to follow standard preventative guidelines to address the current situation.

Counter Sales Reopened

With additional safety measures in place, counter sales/order pickup has resumed at all locations. The counters at our Atlanta, Fort Lauderdale and Las Vegas distribution centers will be open Monday-Friday, 8:30am-4pm. To limit contact, we request that customers first place orders on encompass.com prior to coming to the facility, if possible.

Help for Customers

Encompass is here for you! If we can be of any assistance, please let us know: customercare@encompass.com.  Have you taken advantage of the Coronavirus Aid, Relief, and Economic Security Act (CARES)?  CARES enables small businesses and contract workers to obtain a variety of loans to maintain operations and prevent layoffs during this unprecedented crisis. Tax advantages are also available.

We appreciate your patience and understanding during this difficult time. Encompass will continue to update this company response statement as conditions warrant to keep you informed.

Robert Coolidge
President & CEO

 

 

Planning for Unexpected Supply Chain Disruptions

 Hurricanes in the Southeast. Blizzards in the Northeast. Tornadoes in the Midwest. Earthquakes and fires in the West. Natural disasters occur often and mostly without time for planning. Major transportation carriers and routes are usually impacted, which has an immediate, but mostly brief, effect on supply chain continuity.

But what about supply chain disruptions occurring continents away? As the world’s largest manufacturing country, China plays an extremely important role in U.S. commerce. When something momentous happens – like the coronavirus (or COVID-19) or the once looming trade war with the U.S. – effects typically domino across the globe.

Although it’s still somewhat early days, the COVID-19 crisis is already having a major impact on global trade and logistics with Chinese factory closings, workforce quarantines and transportation disruptions. The electronics industry is at particular risk with Shenzhen, a major hub of electronics and parts manufacturing, located about 700 miles from the epicenter of the virus outbreak. While some manufacturing factories have reopened, thousands of workers remain under quarantine or otherwise unable to travel to work.

The situation is mitigated somewhat by the fact that the initial outbreak coincided with the Chinese New Year during which most businesses shut down for about 10 days. Distributors like Encompass typically anticipate this downtime and plan accordingly to purchase extra safety stock. The question becomes whether the additional inventory will keep pace with demand until business returns to normal in China.

Current fulfillment lead times from Chinese factories are 30 days or more, so even the slightest delays could significantly affect supply and complicate purchasing strategies. What can supply chain managers do to try to limit the impact of global supply chain challenges – particularly those affecting the world’s largest manufacturing cluster? This is probably one of the hottest topics of discussion occurring in U.S. board rooms and purchasing departments across the country.

Whether your business is directly affected or not by the current crisis, it’s still an opportunity to review your purchasing strategy. Identify any weaknesses and determine contingencies as part of your overall purchasing strategy going forward. Here are some areas of consideration:

  • Sourcing Partners – Are all your supply sources in one basket – be it a single factory or geographic region? Assess the impact level to your business and customers of any unexpected, potentially lengthy supply disruptions from this source. Just like your financial portfolio, diversification is good. Consider alternatives for a backup supply pipeline in a different geographic area to help mitigate the risk of being cut off from your primary source without warning. For repair service businesses, this can be as simple as establishing accounts with multiple parts vendors for seamless transition if ever necessary. 
  • Safety Stock – Do you stock enough inventory to meet demand for an extended period of time? While purchasing managers are constantly pressured to keep inventory turning, it may be worth stocking at least some high-demand SKUs beyond ordinary levels — particularly if your business is at risk from limited supply sources.
  • Business Continuity Plan – Many business continuity plans are focused internally on steps a company will take to recover from its own unforeseen events. Downstream disruptions in the supply chain should be included in your overall business continuity strategy.  And put the onus on your sourcing partners to provide their detailed plan for business recovery.

While the U.S. and China have reached a trade agreement and COVID-19 is likely to be contained sooner than later, the risk of future impactful events remains as certain as ever.  Don’t forget COVID-19 is not without precedence; in the early 2000s it was the SARS epidemic wreaking havoc on global trade. Sadly, chances are pretty good this isn’t the last time we’ll be dealing with supply chain disruptions, but ensuring you have a Plan B should help minimize harmful consequences to your business and customers.

Regardless of any business impact, we can’t forget that at the core of this epidemic are human lives. Compared to so many people dying, delays in receiving the next generation smart phone seem meaningless.  Above all, we should be focusing on joining together to help all those affected through this horrific ordeal.

Time for a Mid-Year Goal Assessment

As we are well into the second half of 2018, now is an ideal time to review the business and individual goals your team hopefully set at the beginning of the year. What progress has been made? Is your company positioned to meet these goals by yearend? Is the team continuing to work toward their personal commitments?  If not, what barriers are hampering progress?

      President & CEO
       Robert Coolidge

Goals should serve as a road map for individual professional development and business growth. Establishing targets is the easy part.  Actually following through on them is the real challenge. To help prevent goal setting from becoming meaningless busy work, there must be accountability. Otherwise, your commitments become as pointless as the paper that likely wasn’t used to record them.

Prior to the fourth quarter, it’s a good idea to take another look at the targets you set. Assess the status and where you expect to be by year end. With any luck, some of your commitments may even have expanded into larger opportunities than first thought, or new ones have come into play.

Otherwise, you’ve got to pinpoint where you are falling short and then laser focus on improving those areas. Have market conditions changed? Are the right people in place? Do you have enough resources and the right tools? Don’t wait until Q4 to identify issues that should be addressed now.

If you’re falling short on personal commitments, take a harsh look at what’s keeping you from success. While there may be obstacles, what are you doing to defeat or sidestep them?  At the end of the day, you are responsible for your own achievements. Be honest with yourself, and make a solid plan to get back on track.

You’ve got most of the second half now to make field adjustments and strengthen your game plan. It’s not too late to reach the goal line.

 

 

10 Tips on Shaping Company Culture

As a CEO and former football player and coach, I see many parallels between business and team dynamics. A team has a shot at winning only if all players do their job to the best of their ability. The best quarterback cannot be effective without a solid line and talented receivers.  A running back can’t gain yards without blocking support.  Every position has a purpose, and each must work collectively as a team to succeed.

Robert Coolidge
      President & CEO

For your business to thrive in the long term, you should follow a playbook of strategies to build a winning team and company culture. Here are just a few to consider:

  1. Communication – Leaders should communicate often and honestly about company direction and progress. Silence only leads to speculation and rumors, which are often wrong and can cause distraction and impact morale. Keeping employees informed is also critical to ensuring everyone is working from the same playbook. The more information you share, the more employees will feel ownership.
  2. Integrity – Playing by the rules, even when no one is looking, is a key factor in forming a trusted, honorable team culture. Instill zero tolerance for any shady, corrupt behavior. Always remember your culture forms your brand.
  3. Commitment – During a merger/acquisition, deciding go-forward branding is typically near the top of the To Do list. Whether you opt for a brief co-branding period or hard cut over, all entities must embrace and commit to the new team identity. Uniting under a common brand best promotes a team culture and helps avoid an attitude of “them against us.” Eliminate items with the former brand and substitute with the new to promote company pride as one team.
  4. Empowerment – Empower your team to make decisions. Don’t penalize them for making mistakes; if you never make mistakes, you’re likely not pushing yourself hard or fast enough.  If you do happen to fail, focus on correcting, learning and moving on smarter rather than dwelling on blame.
  5. Goals – Setting baseline goals comes from the top down.  Perfection or 100% should always be the goal.  Anything less is an opportunity for improvement.
  6. Involvement – When starting a new project, ensure initial discussions include everyone who will play a role in execution no matter how large or small. Exclusion could create unnecessary insecurity and confusion. Winnow down the team to core players as practical, but solicit opinions from all members to convey the value of their input and place on the team.
  7. Accountability – Every player must be held accountable for their position and field assignments for the team to be successful. As Bill Belichick would say “Do your job.” Tracking performance and taking responsibility to make improvements is integral.
  8. Pace – This also comes from the top down.  Set the pace for others to follow. Work hard and fast with the intent to execute better each time.  This will guide your team on a path of success.
  9. Prosper – Setting performance goals and incentives gives those who want to excel the chance to be recognized and advance.  It doesn’t matter if they’re in the warehouse, call center or collections – everyone likes to be a winner.  Those that do not have the drive to succeed should understand that their future will be dictated by others.
  10. Camaraderie – While it’s vital for the team to excel on the field, it’s just as important for members to build relationships off the field. Getting to know each other on a more personal level fosters trust and understanding that is difficult to achieve during office hours. There’s a reason that an entire cottage industry is devoted to “team building” activities.

By regularly evaluating your team environment, you can quickly identify and address gaps in your playbook. Always keep your eye on the ball to load the scoreboard.

NSDA Evolving to Meet the Needs of Changing Repair Industry

For more than 60 years, the National Electronics Service Dealers Association (NESDA) has been the premier trade group for technicians repairing televisions, VCRs, DVD players, stereos, etc. But like any forward-thinking association facing industry change, NESDA members realized that focusing strictly on electronics repair would not be sustainable.

In turn, NESDA has rebranded to NSDA (dropping “Electronics”) to cater to a broader spectrum of repair professionals. Appliance now shares top billing, drawing new attendees to this year’s annual NSDA convention. Many previously TV-only techs took advantage of the many appliance repair training courses offered.

In the exhibit hall, the Samsung booth commanded the largest presence, showcasing its latest appliance innovations along with flat screens. Look for Whirlpool, GE, Electrolux, Lennox, Goodman and others to get involved in future conventions. As a long-time supporter of the association, it’s exciting to see NSDA taking the steps necessary to broaden its mission and serve as a valuable resource to industries outside electronics.

President & CEO
Robert Coolidge

But don’t take this change in direction to mean TV repair is dead; many techs will tell you they can barely keep up with their current workload. Then there are those who are satisfied with just a diagnostic fee to proclaim a set can’t be fixed. At some point their business will divert to the harder working competitor committed to finding repair solutions. TV dispatch should result in a repair 80% of the time – even panels should be considered.

NSDA members are some of the brightest and skilled techs out there. Many have or will transition into adjacent sectors for myriad new repair opportunities, especially with whole home warranty companies. If you’re not familiar with NSDA, check it out and consider attending the next annual convention. From access to technical resources to invaluable manufacturer training, NSDA membership offers key benefits hard to find through any other trade association.

 

Five Tips for Thinking Inside the Box for Your Next Outsourcing Partner

Many businesses often realize that certain tasks they’re performing in house are inefficient, wasting time and resources and are far removed from their core competencies. Encompass has been on both sides of either selecting or serving as a business partner, so we have gained a lot

Robert Coolidge
President & CEO

of best practice knowledge over the decades.  When searching for the ideal B2B partner to assume responsibility for any of your pain point functions, here are some in-the-box questions to assist with your outside-the-box strategies.

  1. Customer Service – Can you rely on the supplier to be responsive to your needs? What about your customers? Is the supplier trustworthy enough to serve the lifeblood of your business? Be sure to check them out through the Better Business Bureau, professional references, social media and other channels to get a strong sense of their integrity and service culture.
  2. Key Performance Indicators – How does the supplier plan to measure the successes and challenges of your program? Before implementation, you and your supplier must agree on the standard metrics by which your business will be evaluated. Furthermore, you should have on demand access to reporting on these KPIs to have full visibility to how well (or not so well) your partner is managing your program.
  3. Technology – Can your partner integrate with your operating systems? Depending on the nature of the work they’re doing, having direct connectivity could help expedite certain processes and also provide visibility to valuable data. Plus, to provide visibility to program KPIs, your partner must have the technology to track and report on comprehensive data sets.
  4. Communication – Whom can you contact when something goes wrong or you need immediate assistance? Always insist on a single point-of-contact to serve as your “go to” liaison for issue resolution. If you’re faced with an angry customer or process failure, you don’t want to have to call six people before finally making contact with someone who can help. Additionally, you should be able to have regular business reviews with your supplier to discuss any issues, assess performance and share ideas for enhancements.
  5. Value-added Services – What does the supplier offer your business (and customers) beyond the basics? Ideally, your partner will include many different complimentary services that help enhance your program and streamline processes – from revenue sharing opportunities to technical assistance. But be wary of those that nickel and dime you for every touchpoint; value-added should be just that, not a means for additional profit generation.

At Encompass, we are particularly focused on providing as much “bang for the buck” as possible through streamlined pricing models. We offer many different services – such as e-commerce portal development and system integration – at no extra charge.

However, selecting the right partner should never be just about price. Pricing can usually be somewhat flexible, but a potential supplier’s way of doing business is pretty much set in stone. While aggressive pricing may be hard to resist, marginal service can end up costing you much more in the long run.

Change and Innovation in Aftersales Service

Another Consumer Electronics Show has come and gone, and the industry is well into the first quarter of what promises to be an interesting year of change and innovation for the aftersales service community.

The buzz in the Appliance and Electronics verticals continues to center around the “Internet of Things” with focus on the connected home. Remote monitoring and control of devices throughout the home via WiFi is gaining traction. Now our smart washers can tell our smart phones when the laundry is done, so it appears the Jetsons weren’t as farfetched after all.

With this type of connectivity, it seems logical that remote online diagnostics will be the future of repair, minimizing time-consuming in-home visits. Service teams would be able to connect to home networks and read failure codes to troubleshoot and identify parts needed. Just another few clicks and parts can be ordered – Encompass is standing by!

Robert Coolidge
      President & CEO

In consumer electronics, there may actually be a reversal (or at least slowing) of the replace vs. repair trend.  Display panels have become so thin that components must be housed separately within the control base. This change in design makes televisions less bulky and more portable, which could help energize depot repair. For field techs, commercial and residential installation and connectivity service are tremendous offerings they should be aggressively promoting in addition to repair.

On the back end, warranty underwriters are also exploring innovations to their models. There is much opportunity to “own the home” for extended contract providers looking to expand beyond single product coverage. In turn, whole home warranty providers may consider adding non-traditional goods like televisions, smart phones and    computers to their list of covered items.

With many electronics now easier and potentially less expensive to repair, extended warranty providers should reexamine their product buyout policies. Through a variety of measures, Encompass annually saves our warranty partners millions in buyouts – not including the extensive costs and effort of recovering a faulty unit and disposing it within government environmental regulations.

Once repairs are completed successfully, everyone wins: consumers get functioning products and the service community gets work, while being driven toward the proper behavior of enabling more repairs.  Labor rates could possibly improve more if the repair process can be more efficient and less products are simply thrown away.

Warranty companies avoid costly buyouts and earn satisfaction from their contract holders.  Gift cards and product replacements should be the options of last resort. Even the product manufacturer wins since their products remain in the home and are not displaced by a different brand.

As the industry continues evolving year after year, there will always be opportunity to thrive for those willing to look and work for it.

 

Run Faster!

“Every morning in Africa a gazelle wakes up.  It knows it must run faster than the fastest lion or it will be killed.  Every morning a lion wakes up.  It knows it must outrun the slowest gazelle or it will starve to death.  It doesn’t matter whether you are a lion or a gazelle; when the sun comes up, you better be running.” African Proverb

 If your business has the good fortune to be thriving with many years in operation, it is tempting to kick back and bask in the glow of a well-oiled machine. However, since complacency is the enemy of success, you may need to be reminded of this insightful proverb.

Robert Coolidge
      President & CEO

Relying on past achievements and being satisfied with the status quo are the surest ways to end up as an entrée on your competitor’s plate. To stay relevant, it’s imperative that you keep moving forward with fresh ideas and service offerings to provide value to your customers. Some ideas to get your team thinking creatively in 2018:

  • Brainstorm – Gather staff from all levels of the organization to share thoughts on potential new markets, products/services, sales approaches, operational improvements and whatever else that needs a refresh. Those in the trenches often have the best ideas as they are regularly closest to day-to-day company activity.
  • Get Feedback – Talk to your customers and find out what they want from you that they’re not getting. If they buy from your competition, try to get vital intel on how that business is able to pick up your slack.
  • Stay Informed – Get out of the office and network with others in your industry. Join trade associations, watch webinars and attend conferences to stay on top of trends and capitalize on opportunities to grow your business.

Encompass is marking our 65th year in business this year and couldn’t be more excited. But while we will always honor our heritage, we know that the key to success lies with our ability to continually innovate and evolve. Over the past few years we have worked hard to diversify our parts inventory to become a convenient one-stop source. We continually add new lines as we strive to be a preferred parts supplier for all products in the home from the driveway to the kitchen to the back yard.

We’ve also significantly enhanced our e-commerce site and online catalog to assist customers with parts selection. Encompass.com features tools to link a product’s exploded view to part detail pages for easy identification and ordering. We are currently working with numerous manufacturers to obtain schematics, so we can further bulk up our technician resources.

This year we’re focusing on developing interactive technology, so our customer service agents and in-house technicians can have face-to-face conversations with callers. With this capability, we can better assist business and consumer customers with virtually any parts needs.

No matter how stable and successful your business may be, don’t run the risk of resting on your laurels. You always need to keep running to avoid getting starved out of the market.

‘Hybrid’ Service Concept Expands Opportunity

For the past several years, the mantra in the consumer electronics service industry has centered on business diversification to combat drops in television pricing that sometimes make replacement more economical than repair. While some TV servicers are staying the course, others have determined it’s in their best interest to expand their offerings.

These ‘hybrid’ techs are growing their businesses beyond one product category to help draw more customers and generate additional revenue. Many TV servicers have gravitated toward major appliance repair as a logical fit for their existing skill sets.

           Robert Coolidge
             President & CEO

This evolution was on full display at this year’s National Professional Service Convention hosted by the National Electronic Service Dealers Association (NESDA). For the first time in NESDA’s history, more appliance servicers were new “first timers” to the convention than purely electronics techs. NESDA catered directly to this growing part of their membership by offering a wealth of appliance training courses such as refrigerant theory and handling, sealed systems, Panasonic commercial microwave, LG dishwasher, Samsung home appliance technology and Electrolux/Frigidaire refrigeration.

In July, Encompass is offering a popular training course aimed at helping electronics servicers cross over into appliance repair. The class, led by Level 2 Learning, introduces refrigeration and cooking appliance repair. Judging by the response we’ve received so far, servicers are eager for this type of training. And it’s not just electronics servicers who are diversifying. I recently had my clothes washer repaired by an appliance tech who mentioned he also installs flat panel TVs.

Beyond appliances, all kinds of technology is emerging that requires experienced repair techs, such as digital signage, virtual reality gaming systems and recreational / commercial drones. Encompass had drones on display in our booth at the NESDA convention as we have diversified our own business into this sector to supply parts and sell whole units. Several enterprising servicers at the NESDA convention expressed interest in selling drones at their counters this holiday season – more evidence of enterprising techs seeking opportunities to build their businesses.

Digital signage and mobile devices are other categories worth exploring, as well as home security systems and personal computers. As more warranty companies are moving toward insuring any device in the home, techs able to service multiple products will be in high demand. Electronics techs should have a clear edge as their technical acumen can translate across just about anything with a power switch. (And of course Encompass is here to support your repair parts needs for dozens of different product verticals!)

If you’re not looking for innovative new ways to grow your business, you will get left behind by your competition. There are myriad opportunities to expand whether through product sales or new service offerings. Don’t be afraid to step out of your comfort zone and use your expert skills to try something different. If it doesn’t work out, you’ve lost nothing and gained new experience.