Creativity is Great… Just Not in Accounting

Thursday, August 4, 2016

O.K. I guess it's pretty obvious: Accounting isn’t meant to be super creative, unless you're a Bernie Madoff type, and that only works for a while. As a company, we at Kimal pride ourselves in allowing a lot of "License" with Kimal Associates to constantly try a variety of "creative ideas." As I walk around the company, I see frequent examples of tweaking many things to just improve the processes, and often they're creative changes that make our customer’s experience with us "just a little bit better"! But this all happens in Operations. So although we allow that element, we are brutally tough in "making sure the numbers work" from an accounting standpoint.

“Making the numbers work” didn't happen overnight. Operations covers wide range of processes! But to point out a few examples…With Receiving, we count and verify all shipments that come into our locations. With order taking, we make sure that the "order entry" into our system is very accurate. We do frequent reviews of our codes in our Epicor systems to insure accuracy. In taking care of customers, all Associates are trained to give the customer exactly what their invoice calls for. If we have to substitute, lengths, grades, whatever, we account for that so the adjustment is made in our system. We are soon to be initiating a "Material Verification" (i.e. load check) at our point of exit at our locations, which will include customers, as well as our own delivery trucks as they make that final pass through our gates, going to a jobsite. We're already taking pictures of loads (windows, doors, mill work, whatever) just before our trucks leave the gate. All of what I'm mentioning comes "full circle" fruition, if you will, when we take our annual Inventories. They always say, "The best surprise is no surprise!" So, in thirty-five years we've never had anything even resembling a real Inventory shrink.

The extra effort we take in adhering to this “rigid” accounting process, from end to end, may initially cost more to keep in place, but pays dividends in the end...and I feel the customers appreciate the propensity to give them "exactly what they're paying for"! We are also moving into "Cycle Counts," and eventually, Inventories on a monthly basis on all "Key" items, especially commodity products. Maybe another way of describing all of the above is trying to maintain a kind of "Loose-Tight" set of policies--super accounting on the one side, but, operationally, making sure the customer always leaves with the feeling that KIMAL personally generated for them, "The best bang for the buck."

Good selling, and good "accounting" to all.

A little "snippet"…

Ann and I were in Lithuania a couple of weeks ago. A great country, rich in history, culture, etc. We were in their Capitol, and noticed a billboard repeated a number of times...It said, "Less Blah, Blah, Blah...More DO" I feel (and the Lithuanians verified) that the billboards were saying, “Don't talk so much…Get out and create action.” They've only had true Independence since 1991, so I felt that message to all was very inspiring and insightful.

Al E. Bavry, CEO, Kimal Lumber & Hardware 8/4/2016

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