CustomXM of North Little Rock owner Paul Strack says he may have to cut employee hours as demand slows amid the spread of COVID-19.
Editor’s Note: This is the second in a series of short features on small businesses responding to the COVID-19 coronavirus pandemic.
Custom XM has, to put it gently, excess capacity.
“Obviously, we have had a significant decline in orders since Thursday of last week,” owner Paul Strack said Tuesday morning.
And while he and his six employees were still on the job, he’s already accepted that he will have to send some home early.
“That’s coming. I don’t see any way around that, that we will have to reduce hours. There’s just no way around it at this point,” Strack said.
Reduced hours is a management technique he has occasionally used for past slowdowns, but it was not something he expected to do this year. “I was very optimistic about 2020 because for the first couple of months revenue was up about 5%,” Strack said.
The pandemic also comes while Strack is trying to sell his production plant on Pike Avenue in North Little Rock to consolidate in expanded space at 7th and Main Street in Argenta.
Founded in 1966, Custom XM has been through a lot of economic ups and downs, but Strack could think of no parallel to the COVID-19 pandemic. “What a crazy time, isn’t it? When it was 9/11, the message was everyone get back to being normal, get out and do things. And this is the exact opposite.”
Through sheer luck, Custom XM had already completed most of its work printing materials for upcoming events that have since been canceled or postponed. And some orders were still coming in — feed tags for the agricultural industry, membership agreements for health clubs, etc. But orders for direct-mail marketing pieces — “that’s dried up,” he said.
“We preach, as any marketing-related industry does, that you don’t cut marketing,” Strack said. But, ironically, his own business-to-business marketing may suffer because Custom XM’s direct-mail pieces typically go to businesses, and many have ordered employees to work from home.
Custom XM also does email marketing. On the afternoon of March 9, the company sent an email advertising custom-branded hand sanitizer in personal-size bottles, but without any specific reference to the coronavirus.
“About half an hour after I sent that email, we got notice from our supplier that those were not available,” Strack said. And while he had first been warned that none would be available until June, one supplier sent word Tuesday morning that they were back in stock.
Strack said he was brainstorming an idea for a “social distancing boredom-buster kit” — a box of activities like photo books and playing cards that could keep his machinery running, his employees busy and perhaps generate revenue that he could share with a nonprofit organization. To see what he comes up with, check the CustomXM website.
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