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Local companies hire interns, let employees work at home and even keep thermostat low
By Paula Schleis
Beacon Journal business writer
Published on Monday, Dec 01, 2008
One company lowered its heating bills by installing a programmable thermostat that drops the temperature to 62 degrees when no one is around.
Another added 7 percent to its bottom line by changing work-flow procedures to reduce labor costs.
A third company allows employees to work from home twice a month and occasionally passes out gas cards. The logic: Having a content work force means less money spent on recruiting.
Local companies say the volatile economy is teaching them to do without — or do things differently.
The Akron Beacon Journal recently asked business owners and executives to share their cost-cutting strategies so that they might inspire others.
Here's what we found:
All-American Soap Box Derby, Akron;
Jim Huntsman, president
This year for the first time, the derby is renting out unused space in one of its warehouses to people who want to store automobiles or other large items.
Also, employees who work in a second warehouse have been scheduled for four 10-hour days, at least through this year, enabling the derby to close that warehouse on the fifth day and save on heating and electricity.
Summit Data Communications, Akron;
Ron Seide, president
Summit, which makes wireless radio modules and cards for mobile devices, hired its first crop of interns and University of Akron co-op students this year.
The five students account for about a quarter of the young startup's head count.
''In the few short months that we've had them, they've already made substantial contributions to the company in the areas of development, testing and marketing,'' Seide said.
A portion of their compensation is paid through a state program, he said, but ''even absent this program, we'd be getting a great deal.''
''And I know that the students are getting the real world experience they'll need to start their careers — either at Summit or elsewhere,'' he said.
Akron Monument & Granite Co., AkronJim Leone, president
The company installed a programmable thermostat, which reduces the temperature to 62 degrees when the office is closed.
Leone said he also saved on monthly hospitalization premiums by switching to a Health Savings Account Plan (HSA).
''We elected to have a higher deductible, and also open a health savings account. Money that we put into that account earns interest, and at the same time, can be used for other eligible medical expenses,'' he said.
Boville Industries, Orrville; Larry Boville Sr. and Larry Boville Jr.
The father-son team says the coatings company saves by timing its purchases.
In good months, the company buys more than it needs of routine supplies (like paint) because the vendor offers discounts for bigger orders. In poor months, having overstock means there is less to buy.
The company also has employed a couple of strategies for keeping vendors' prices down.
''Place your vendors at the same table at the same time. You will be surprised what you learn about the product you're about to purchase,'' Boville Jr. said.
And when push comes to shove, give your supplier an ultimatum.
''We recently had a vendor asking for a 5 percent price increase for the third time in 2008. Our response to him was this: 'We have instructed our comptroller to pay your invoices at the present price level no matter what the charge. You will have to decide whether you want to continue doing business with us or not.' The vendor reduced the price increase to 2.5 percent.''
Finally, the Bovilles have drawn a line with their credit card, decreasing usage by 95 percent in the past 18 months.
''You would be surprised by the things you can do without and still get the job done,'' Boville Jr. said.
item North America, Akron;
Rick Sabo, spokesman
A work-flow analysis revealed that quite a few hours were being wasted at the equipment manufacturer because space limitations required moving things around that weren't ready to ship.
This year, the company built a 20,000-square-foot addition to eliminate unnecessary movement. The new building allowed for reorganization of small-parts inventory and increased shipping times.
Finally, high-volume operations such as cutting, drilling and tapping have been automated to increase output while eliminating human error.
The company estimates it has added 7 percent to its bottom line as a direct result of those changes.
Knotice, Akron
Brian Deagan, chief executive
Knotice, a marketing software company, allows employees to work from home two times a month. The company also occasionally distributes gas cards from $25 to $50.
Helping employees save money helps the company.
''Turnover can cost quite a bit of money, but Knotice rarely has to deal with it,'' Deagan said. ''In the long run, the perks actually save Knotice money because employees stay.''
InSeT Systems, Akron;
Mike Millam, chief engineer
The company employs only its three founding entrepreneurs, who are working on new technology for finding underground coal miners, but even they have found ways to conserve funding.
By using 3-D design programs, they can review all mechanical parts before production. And Fused Deposition Molding provides an inexpensive way of testing form, fit and function before committing to the high expense of making the final product. See how it works at http://www.360-engineering.com/GoPrototype.html.
The company also takes advantage of online office supply programs, like Office Depot Business Services Division. By keeping an active list of office needs, it knows when it has enough to fill a $50 order to get free shipping, saving gas that would be spent driving and time that would be spent shopping.
Rice Cos., Akron; David Charlton, president
Initiatives helping this industrial lubricant distributor and service save money include modifying delivery trucks to run on biodiesel fuel.
It not only pollutes less, but it also reduces operating expenses by using waste cooking oil from local restaurants to process into fuel, Charlton said.
The company outsourced the sales manager position to free the existing manager to spend more time in the field selling; and it outsourced information technology functions to free staff to focus on services that customers pay for.
The company uses oil to reduce natural gas expenses and heat the warehouse; Web-based meeting programs to reduce travel expenses; and the Internet and scanners to reduce paperwork and postage.
The company also helps employees earn extra money by offering them extra jobs, like lawn maintenance and cleaning the office.
Diamond Insurance Agency, Medina;
Nick Corp, owner
Corp recommends businesses shop their insurance needs around to see ''if you can get the same or better coverage for a better price.''
''No single company is better across the board with pricing,'' he said. ''That is why it is always best to get quotes every few years.''
Most insurance companies underwrite and rate business insurance differently, so premiums and coverage can vary significantly.
''Find an agent that specializes in business insurance to review your policy and make recommendations. An experienced commercial agent can take an expert look at your policy and help find you the best insurance value,'' he said.
''Best of all, quotes are free and if the quotes come back higher, you can have the peace of mind that you're not overpaying,'' he said.
Paula Schleis can be reached at 330-996-3741 or pschleis@thebeaconjournal.com.
One company lowered its heating bills by installing a programmable thermostat that drops the temperature to 62 degrees when no one is around.
Another added 7 percent to its bottom line by changing work-flow procedures to reduce labor costs.
A third company allows employees to work from home twice a month and occasionally passes out gas cards. The logic: Having a content work force means less money spent on recruiting.
Local companies say the volatile economy is teaching them to do without — or do things differently.
The Akron Beacon Journal recently asked business owners and executives to share their cost-cutting strategies so that they might inspire others.
Here's what we found:
All-American Soap Box Derby, Akron;
Jim Huntsman, president
This year for the first time, the derby is renting out unused space in one of its warehouses to people who want to store automobiles or other large items.
Also, employees who work in a second warehouse have been scheduled for four 10-hour days, at least through this year, enabling the derby to close that warehouse on the fifth day and save on heating and electricity.
Summit Data Communications, Akron;
Ron Seide, president
Summit, which makes wireless radio modules and cards for mobile devices, hired its first crop of interns and University of Akron co-op students this year.
The five students account for about a quarter of the young startup's head count.
''In the few short months that we've had them, they've already made substantial contributions to the company in the areas of development, testing and marketing,'' Seide said.
A portion of their compensation is paid through a state program, he said, but ''even absent this program, we'd be getting a great deal.''
''And I know that the students are getting the real world experience they'll need to start their careers — either at Summit or elsewhere,'' he said.
Akron Monument & Granite Co., Akron
Jim Leone, president
The company installed a programmable thermostat, which reduces the temperature to 62 degrees when the office is closed.
Leone said he also saved on monthly hospitalization premiums by switching to a Health Savings Account Plan (HSA).
''We elected to have a higher deductible, and also open a health savings account. Money that we put into that account earns interest, and at the same time, can be used for other eligible medical expenses,'' he said.
Boville Industries, Orrville; Larry Boville Sr. and Larry Boville Jr.
The father-son team says the coatings company saves by timing its purchases.
In good months, the company buys more than it needs of routine supplies (like paint) because the vendor offers discounts for bigger orders. In poor months, having overstock means there is less to buy.
The company also has employed a couple of strategies for keeping vendors' prices down.
''Place your vendors at the same table at the same time. You will be surprised what you learn about the product you're about to purchase,'' Boville Jr. said.
And when push comes to shove, give your supplier an ultimatum.
''We recently had a vendor asking for a 5 percent price increase for the third time in 2008. Our response to him was this: 'We have instructed our comptroller to pay your invoices at the present price level no matter what the charge. You will have to decide whether you want to continue doing business with us or not.' The vendor reduced the price increase to 2.5 percent.''
Finally, the Bovilles have drawn a line with their credit card, decreasing usage by 95 percent in the past 18 months.
''You would be surprised by the things you can do without and still get the job done,'' Boville Jr. said.
item North America, Akron;
Rick Sabo, spokesman
A work-flow analysis revealed that quite a few hours were being wasted at the equipment manufacturer because space limitations required moving things around that weren't ready to ship.
This year, the company built a 20,000-square-foot addition to eliminate unnecessary movement. The new building allowed for reorganization of small-parts inventory and increased shipping times.
Finally, high-volume operations such as cutting, drilling and tapping have been automated to increase output while eliminating human error.
The company estimates it has added 7 percent to its bottom line as a direct result of those changes.
Knotice, Akron
Brian Deagan, chief executive
Knotice, a marketing software company, allows employees to work from home two times a month. The company also occasionally distributes gas cards from $25 to $50.
Helping employees save money helps the company.
''Turnover can cost quite a bit of money, but Knotice rarely has to deal with it,'' Deagan said. ''In the long run, the perks actually save Knotice money because employees stay.''
InSeT Systems, Akron;
Mike Millam, chief engineer
The company employs only its three founding entrepreneurs, who are working on new technology for finding underground coal miners, but even they have found ways to conserve funding.
By using 3-D design programs, they can review all mechanical parts before production. And Fused Deposition Molding provides an inexpensive way of testing form, fit and function before committing to the high expense of making the final product. See how it works at http://www.360-engineering.com/GoPrototype.html.
The company also takes advantage of online office supply programs, like Office Depot Business Services Division. By keeping an active list of office needs, it knows when it has enough to fill a $50 order to get free shipping, saving gas that would be spent driving and time that would be spent shopping.
Rice Cos., Akron; David Charlton, president
Initiatives helping this industrial lubricant distributor and service save money include modifying delivery trucks to run on biodiesel fuel.
It not only pollutes less, but it also reduces operating expenses by using waste cooking oil from local restaurants to process into fuel, Charlton said.
The company outsourced the sales manager position to free the existing manager to spend more time in the field selling; and it outsourced information technology functions to free staff to focus on services that customers pay for.
The company uses oil to reduce natural gas expenses and heat the warehouse; Web-based meeting programs to reduce travel expenses; and the Internet and scanners to reduce paperwork and postage.
The company also helps employees earn extra money by offering them extra jobs, like lawn maintenance and cleaning the office.
Diamond Insurance Agency, Medina;
Nick Corp, owner
Corp recommends businesses shop their insurance needs around to see ''if you can get the same or better coverage for a better price.''
''No single company is better across the board with pricing,'' he said. ''That is why it is always best to get quotes every few years.''
Most insurance companies underwrite and rate business insurance differently, so premiums and coverage can vary significantly.
''Find an agent that specializes in business insurance to review your policy and make recommendations. An experienced commercial agent can take an expert look at your policy and help find you the best insurance value,'' he said.
''Best of all, quotes are free and if the quotes come back higher, you can have the peace of mind that you're not overpaying,'' he said.
Paula Schleis can be reached at 330-996-3741 or pschleis@thebeaconjournal.com.
