by Anthony Noel
Here's a quick rule-of-thumb to ensure that custom projects are profitable.
More than any other maxim I've heard about doing custom jobs, the 'PDQ Rule' has been the most valuable to me in finding work - profitable work.
I learned the rule from my dad, part owner of a tool and die shop. Like custom woodworking, tool and die making is precision work, highly customized in nature. Though a given die might be used to stamp millions of parts, the die itself is a carefully designed, tested and executed piece of custom metalwork, not unlike a highly designated wall unit.
The PDQ Rule applies exclusively to just such work. When you begin to get involved with production runs, however limited, the rule's applicability becomes limited, too, and it goes right out the window in non-custom operations. The rule itself is:
'In custom work, remember these three: Price, Quality and Delivery.
The client can have his terms on two; naming terms on the third is up to you.'
The rule recognizes the challenges inherent in providing custom work and affords you the opportunity to make these challenges clear to your clients, while cutting down the chances of alienating them. Let's look at it a little more closely.
There are three basic issues to be resolved when you are selling a job: Price, Quality and Delivery. A typical client would, of course, like to dictate the parameters of all three items. Who wouldn't? But the reality of the situation won't allow that - at least, not if you want to be around to keep doing business in the future!
This is the real crux of custom work. Custom, after all, means unique, 'tailored' for a specific use. To use the tailoring analogy, think of the choice you have in buying clothes. Walk into a department store and select a suit off the rack, let them sew the trousers to length, and pick up the whole works in two days. Or, head for a custom tailor, select a design, get measured, come in for a fitting, leave again, wait a week or two and, maybe, your suit will be ready. And you will pay dearly for it!
The very nature of custom work prohibits allowing clients to name their terms on all three issues - price, quality and delivery. But you can (and should) be willing to give a customer his terms on any two, his choice. As long as he will allow you your terms on the third, you'll be covered.
For example, if your client wants a low price on a high-quality coffee table, fine. But you'll need the freedom to work on the project as more profitable work in the shop permits, so the delivery date is up to you.
Or, let's say someone wants a custom sideboard in time for a dinner party next weekend. The customer is naming the delivery and quality terms (I always work on the assumption that if someone's calling me, they're looking for high-end work), so I get to name my price.
But what if the same client wants the sideboard just as fast and cheap, too? Well, after carefully explaining that I'm accustomed to doing high-quality work, I'll either pass the job up, or make clear that I'm unable to make any quality guarantees, since she is getting the price she wants in a very short delivery window.
Now, the PDQ Rule is not necessarily a sales tool that you announce to your prospects. It is best used as a personal guide, a kind of acid test you should apply to any deal. When you determine that a project represents a violation of the rule, think long and hard before accepting the work - it will very likely end up costing you money in the long run. Similarly, when the terms of a project pass the test, you'll know that you're safe. And there will even be those occasional jobs when you get the terms you'd like on two of the three.
Sometimes, however, you'll get a prospect who insists on getting his terms on all three items. He wants to dictate the price (which barely covers your labor estimate, never mind the materials), he wants craftsmanship of flawless quality, and he wants it delivered by Monday. This is the perfect candidate for a patient explanation of the PDQ Rule and the price you stand to pay if you break it.
I would say, 'If you're going to insist that I do business this way, there's a good chance I won't be around to do more work for you in the future. You came to me because you were confident of my ability to produce work to your exact needs. If you are unwilling to work with me on the terms, neither of us will get what we want.'
Since educating your clients is such a huge part of selling custom work, it is pretty obvious how applying the PDQ Rule can simplify that part of the process. Unfortunately, there are going to be prospects who simply refuse to bend, to see the difference between your work and the 'cookie-cutter' products offered in so many stores. Let them go - they are not the clients you're after anyway.
Remember that custom work is unique and should be sold that way. Using the PDQ Rule for guidance, you'll still be in business to sell it tomorrow.
Anthony Noel writes, consults, and teaches woodworking and journalism, along with doing an occasional custom job in his shop in Macungie, PA.
Have a business related question? Visit WOODWEB's Business Forum. The Business Forum is co-sponsored by ISWonline and is moderated by Anthony Noel. All business topics are welcome, from sales and marketing to dealing with difficult customers.
This article is reprinted by permission of Custom Woodworking Business Magazine.
