One of the most difficult jobs we have is being the bearer of bad news. A client comes to us with a new product, acquisition target, or business idea and wants help evaluating it. Often what clients mean by this is that they want an expert to validate the decision they have already reached. Unfortunately, not all ideas are as great as the client would like them to be. When we do some background research, talk off the record to key decision-makers, and look at competitive pressure and buying trends, sometimes we find that the light the client sees at the end of the tunnel is actually an oncoming train. That’s when we have to tell the client his baby is ugly–never a pleasant proposition.
But looked at another way, breaking bad news is actually one of the better services we provide. What if, instead of coming to us, the client had gone directly to an advertising agency, for example. Even if the agency understood the market well enough to be able to see that the idea is faulty (which is unlikely), what are the odds that the agency would say: “you know, this $500,000 advertising campaign you’re about to launch is probably a mistake.” Even subordinates within the company are unlikely to point out that the emperor has no clothes. No, the only unbiased, unvarnished, brown-nose-free opinion a company is likely to get is from a consultant with no vested interest and a wealth of industry contacts and experience. And sometimes bad news is the best news a company can get, because the money saved by not making a bad decision can be put to better use.
Last week I talked about the fact that there were too many sellers chasing too few buyers. Well with Midmark’s announcement regarding the purchase of European Design Cabinets, the sellers’ ranks just got smaller. This affects a lot of people, including the PSA reps, and it may have a domino effect on the equipment side. When big good companies get bigger, mid-size, not-so-good companies are in trouble. It takes leverage to be a market leader. Smarts also helps, and Midmark has a lot of each. It remains to be soon what other companies will do, but in a tight market anything can happen. Stay tuned!
The economic news is bad from everywhere. A weak dollar, high oil prices, a tumbling stock market and the occasional rumblings about a recession. What does this mean for the dental industry? In a few short words, a slow fourth quarter and a slower 2008. Survival may mean changing the status quo. This could be a great time to look at your current strategic mix and make a few changes. Start with your international business. The weaker dollar means lower prices abroad. Europe is especially attractive. If you have never attended one of the major European shows, this may be the time. There is no IDS, but the FDI is in Sweden. Make sure your international dealer network is solid, and well-trained. Don’t make promotions too complicated. Your products should meet all international standards including CE and ISO. In the US, start looking at specialty meetings to target better customers. Implant meetings are especially growing. Tighten up promotions and be sure they are well-communicated. Your website should never look better. And, make sure a customer can place an order. The temptation to cut prices will be strong, but the only one who benefits is the dentist, and they are already making a lot of money. Sell value where you can. It is a better buy. And when all is said and done, think of the people who may not make it through this downturn. Find some way to donate time, goods or services to help the underserved. There are some great organizations in our industry who could use the help. We have said, at one time or another, that the dental industry is “recession-proof”. 2008 might really test that theory.