Don Freeman’s company started to feel the effects
of an economic downturn back in 2000, and the
events of Sept. 11, 2001, only exacerbated the
problem.
Freeman, CEO of Dallas-based Freeman, had to re-evaluate everything the company did. Its bread-and-butter in
2001 was producing trade shows and creating exhibits for
firms renting booth space at events, but the terrorist
attacks forced the company to re-examine everything.
Revenue dropped between 7 and 8 percent the next year,
and there were no signs the market would recover any
time soon.
“It really got our attention,” Freeman says. “We had to
get serious about our budget costs and keeping costs
down.”
Freeman knew the company needed to cut costs and
rebrand itself if it were going to survive in a rapidly changing market.
Cutting costs
The first objective was to make sure the company stayed
profitable, so Freeman turned to his employees to help
him make budget cuts. He formed focus groups, both at
the corporate level and in individual offices across the
country, to brainstorm what cuts could be made.
He gave much of the responsibility of meeting departmental budgets to the department heads, telling them they
were in charge of meeting a new budget with lower spending projections, and they could figure out how to make
cuts.
Employees were quick to spot waste, and Freeman
found himself agreeing with nearly every change they
wanted to make. Much of the waste was a result of the
company’s headier times, when revenue was flush, an
easy mistake for any company to make.
“We had gotten loose on a lot of things,” Freeman says.
“We had car allowances, but we had also given people gas
cards. So, not only were they getting the car allowances,
which was supposed to take care of their fuel, but people
were using those to buy gas for things other than business
reasons. We had to go back and look at a lot of those
things where we had gotten loose. They were cutbacks,
but things we should have been doing anyway.
“We also made people a lot more conscious of their
entertainment expenses for clients. We cut back on
Christmas presents that we had traditionally done for
clients.”
Because the company has an Employee Stock
Ownership Plan, it was easier to get employees to hunt for
ways to meet the budget. If the company prospers, so do
its employees, creating a reward for honesty.
“People are pretty conscious about that,” Freeman says.
“There is a bit of peer pressure among our people.”
Freeman found other savings after examining the marketing budget. He evaluated sponsorship and advertising
opportunities by what the company got out of them. Did
Freeman get a new client by sponsoring a particular show?
Did any new business come from the advertising it had
done in the past? If the answer was no, then Freeman wasn’t likely to do those things again.
Staff also needed to be reduced, and Freeman left many
of those decisions up to the department heads and branch
managers. It was the only layoff in the company’s history,
and while it was painful, it was necessary to move forward.
He set a deadline for the layoffs to occur and made sure
they happened by that date.
“I left it up to them,” Freeman says. “I told
them, ‘You have to get down to this number. You have to make the decision as to
how you are going to get there.’”
Freeman says he learned an important
lesson during this time: Job cuts are better
than salary cuts. He discovered this
because employees in one Freeman field
office all took pay cuts rather than eliminating anyone’s job because they didn’t
want to lose anyone.
But months after that decision, the staff
of that office felt discouraged and unhappy
that they were being paid less than before
and began to resent the decision.
“People were not happy with the fact that
they were making less money,” Freeman
says. “Initially, it was all for one and one for
all. Then people began looking at their
withholding statements and realized, ‘Hey,
I made less money this year than I did the
year before.’ It’s just better to keep the people we have happy.”
Cost-cutting has to start at the top.
Freeman looked at what he was costing
the company and made cuts there as well
to help the company meet its budget and
set the example.
“There were some memberships in a
health club, for instance, that the company
for years and years and years had paid, and
I thought, this just isn’t necessary,” Freeman
says. “If I want to go to the health club, it
ought to be my responsibility. There are little things that I think I’ve always done.
“If we have a party at my house and we
need some tables and chairs out there, I
have them write an invoice and I pay the
cost. I don’t just tell them to run out there
with a truck and deliver some tables. It’s a
philosophy I’ve always had.”
Rebranding
After cutting costs and trimming staff,
Freeman needed a way to grow again, and
it started with trying to find ways to capture different kinds of business. Freeman
wanted the company to have a more
diverse array of services and a wider variety of clients.
Top management went through a strategic planning session to set a new course.
“I always felt like you do your budgets
from year to year and try to do better,”
Freeman says. “But we went through a
strategic planning session and we realized
we (could do more work) for the corporate
market, sales meetings, shareholder meetings, usergroups and things of that nature.
We felt like there was a tremendous
growth opportunity in that area. So we decided to pursue that area more aggressively.”
To position the company to attract new
corporate business, Freeman had to reexamine its customer service. As Freeman
saw it, the company’s best prospects for
more corporate business were the many
exhibitors from trade shows —- people
who knew the company’s name and might
have a need for its services.
Freeman executives commissioned a survey of 15,000 exhibitors from a wide variety of trade shows held all over the country
to give them feedback about the perceptions of the company.
The survey told them that some companies had a negative view of Freeman, mostly because it was the sole company the
vendor could rent certain things, such as
chairs, tables and electrical hookups, from
at an event. Freeman compares the idea to
buying a hot dog at a baseball park: There
is one vendor to buy from, and whether or
not it’s warranted, the perception is that
the hot dog is overpriced.
The idea, then, is to make sure exhibitors
believe they are getting exceptional value
and great service from his company at
trade shows.
“People tend to accept prices if they are
getting good service and people are friendly and they feel that their business is appreciated,” Freeman says. “I don’t think any of
our people got to the point that they
weren’t friendly, but we did have service
errors that were not acceptable. We were
able to track when we had service errors at
a show site back at the corporate office,
and we could tell at a particular event if we
had a lot of people going back to the service desk saying, ‘We’re missing a chair,
we’re missing a table,’ that sort of thing.
“We started measuring those and getting
feedback from people.”
To serve as a reminder of the company’s
new customer-focused attitude, Freeman
also introduced a customer service slogan
to help employees remember their mission:
“Do it right, first time, every time.” He also
reintroduced the idea of an inventory check
for every booth the night before a show
starts, and every day during the show.
“It was just basics I thought we had
always done,” Freeman says. “I guess we
got away from some of those things. It was
that type of thing more than any brand new
ideas like putting candy on the service
desk.
“That’s nice, but I think people would
rather have their chairs in their booth
rather than a piece of candy.”
Freeman brought in a new head of corporate sales and more salespeople to help get
the word out about the company’s services.
“We’ve had great success,” Freeman says.
“We’ve had some tremendous increases in
revenue in that corporate account area.”
Another change was to change the company’s name. Since its inception in 1927, it
had been called Freeman Decorating Co.
Freeman hired a consulting firm to study
how the name should change and what it
should be.
That firm started by interviewing
Freeman’s staff, getting to know the culture and how the company operated. The
consultants recommended doing away
with the various logos for different
Freeman divisions or branches, as some
were taking the initiative to create a new
logo or theme for different offices.
“We were confusing people more than
identifying what we did,” Freeman says.
The result was a rebranding of the company simply as “Freeman” to broaden its
appeal and allow it to market beyond decorating booths for trade shows. The
change was made official in 2003 and made
definitive with a new Web site and marketing materials, and by executives visiting
every Freeman office to explain the
changes.
All the strategic changes have paid off. The
company has 350,000 clients and produces
3,800 expositions each year and 102 of the
200 largest trade shows in the United States.
It has 70 offices in 41 North American cities
and 3,800 full-time employees.
Revenue for fiscal 2006 was $1.17 billion, a
13 percent increase over fiscal year 2005.
“I think we’re considered the premier
exhibition service company in North
America, without a doubt,” Freeman says.
“We are more and more getting an image
and reputation of being a creative company. It’s interesting how even trade associations and professional associations are
more brand-conscious. Every business is in
a competitive situation today. … Even nonprofits are becoming much more conscious of branding their organization and
their events.
“That’s where we really shine. Our experience with the corporate market is much
more brand-sensitive. … Our ability to
respond with that brand awareness and
being able to create events that enhance that
brand awareness, that’s what sets us apart.”
HOW TO REACH: Freeman, (800) 453-9228 or
www.freemanco.com
