5 takeaways from the State of Moving Industry Roundtable
We recently sat down with Charles White, President of the International Movers Association, Beau Roskow, Vice President at Naglee Moving and Storage, and Wonjun Jeong, CEO and Co-Founder of Supermove to discuss the findings from The 2023 State of Moving and Storage Report and what they mean for the industry.
Check out the full recording of the conversation, or keep reading for our 5 top takeaways.
Top 5 takeaways from the State of Moving and Storage panel
Takeaway #1: Recession may be looming but inflation is the more pressing issue
While talk of recession is dominant in the media, our panelists called out inflation as a bigger concern, and something that is affecting every aspect of the moving industry.
“The inflationary times that we're in are something we haven't seen almost my entire time in moving. I came into the moving industry in the early 90s and I don't know that we've seen inflation like this since then. We've been through a downturn a couple of times but this inflation is affecting every aspect of our industry all of the products that we have to buy to be able to meet the needs of customers,” says Beau.
Charles echoes this and adds that as inflation impacts the cost of running a moving company, it will also have a huge impact on how movers price their services.
Historically the moving industry has still done well in both good and bad economic times, because people are still moving. However, both Beau and Charles caution that inflation is a different beast. Moving companies traditionally chase a lot of revenue, but because inflation hits you in your costs you’ve got to really pay attention to margins. And in a low-margin business like moving, this means having a strong view into your financial wellness as a business.
Takeaway #2: Financial literacy is THE key development area for movers
Our panelists pointed out that most folks who own moving companies know moving inside and out since so many folks come up through the ranks from being a mover or driver to being an owner. The downside of this is that it can be easy to get too narrowly focused on the operations side of the business, especially if that’s your comfort zone.
If that’s the case, says Charles, you need someone on staff who is able to deeply understand the financial side of the business. He points out that in his work for IAM, he’s noticed that the weak spot across the industry seems to be financial literacy, especially when it comes to really understanding costs, margins, and what it means to be profitable.
“Understanding your cost is critical at this point and understanding what effect that's going to have on your pricing. I understand we are in an unbelievably competitive market but we've got to be able to price our work accordingly,” says Charles.
Beau offers some useful advice for those unsure of where to start when it comes to understanding finances.
“Start simple and understand what you are solving for.”
He says that financial acumen will give you a view of your strengths and weaknesses and blindspots as a business– all essential factors if you’re looking to grow. And once you figure out what you’re solving for you need to understand how to monitor it.
Takeaway #3: Peak vs non-peak is not a healthy way to view your business
Both panelists talked at length about how the traditional way of breaking up the year into “peak” and “non-peak” is not good for the financial wellness of your business. This is especially true if you’re running around like crazy during peak season, but dead during non-peak.
It’s very difficult to plan for the future if you’re just hoping every year that your peak season will be enough to carry the business forward. Charles calls out that in his work with IAM, he has noticed that a lot of companies outside the US are much more diversified– they find ways to use their warehouses, trucks, and personnel throughout the year to keep a consistent flow of business.
Which brings us to the next takeaway…
Takeaway #4: Diversification is important but needs to be done strategically
Yes, diversification is a really important strategy for moving companies looking to move away from the traditional peaks and valleys of the industry. But this needs to be undertaken strategically (and with a good understanding of your finances!) to be successful.
You’re probably familiar with the common ways moving companies diversify: Last-mile delivery, storage, office moves, and municipal government partnerships being a few. These are popular because they don’t have the same seasonality as household moving.
But our panelists caution that diversifying isn’t just about filling the gaps in your slow season, it’s really about capacity and understanding how to leverage it, and use that information for planning.
They encourage moving companies to have different lines of business but also be aware of not overwhelming yourself in one area because this could risk your capacity and your brand in others. For example, you can’t start doing last-mile delivery in the winter then just turn it off when household moving picks up in the summer. You need to maintain the capacity to manage all lines of business year-round in order to be successful.
Takeaway #5: Good talent management is foundational for success
We’ll keep this takeaway short and sweet– finding and retaining talent is a challenge that comes up again and again. The best thing you can do to alleviate some of the pressure of hiring great people is to grow and promote great internal talent. But folks have to be happy to want to grow with you.
Our panelists brought up a bunch of ways to build a culture that workers want to grow with, which we’ve distilled into 5 key questions you should be asking yourself:
- Do you know everybody in your company by name? It might seem small, but having a personal connection with all employees makes a big difference.
- Does everyone understand their relevance? Every person in your org plays a vital role. Make sure they understand how they’re connected to the success of the business (again, knowing your numbers and how everyone contributes is really important here).
- Do they understand the full mission and vision of the organization? Having a strong mission helps create cultural buy-in.
- Does everyone have a growth plan? If they can see their growth path, they’re more likely to stick around.
- Are you investing enough in training and development? Give your employees opportunities to broaden their skills (this is also a great way to nurture drivers internally since they are notoriously the hardest folks to hire).
To sum up, our panelists outlined some things you can start working on today to help your business weather whatever economic challenges are coming.
- It all starts with financial literacy. You need to understand your numbers because they can tell an interesting story. You don’t need to be a CFO, but you need to have a basic understanding of key numbers in your business and you need to be reviewing those numbers monthly.
- Know your people better than anybody else. Your people are your company, so get to know them and their aspirations.
- Stay curious. The moment we think we know everything is when it’s time to give it up. Consumers are changing, talent is changing, and you need to stay curious because, as Beau says, “the problems we’re solving today are not the problems of yesterday”. It’s not about what success was, it’s about what success is going forward.
- Find partners that you can ask questions of, like Supermove or IAM. The days of gatekeeping information in the moving industry are over, and there are so many organizations here to help you be successful.
- Don’t be afraid to fail and try something new. You’ll learn something.
This blog only covers a small percentage of what was discussed in the webinar. Click here to see the full conversation.