Using the Metric System in Your Business

Successful small business expansions and new formations lead the
way in creating new markets, innovations and jobs that fuel
economic growth and prosperity.

In recognition of the importance of small business to a strong
economy, the U.S. Small Business Administration (SBA) is pleased to
help meet the information needs of aspiring entrepreneurs.

We hope Focus on the Facts meets your needs and we invite your
comments and questions.

Metrication

The U.S. government’s decision to mandate the metric system as the
preferred system of weights and measures for procurement contracts
will have far reaching implications for the business community and
for society. Metrication will have an impact on both product-
oriented and service-oriented firms. For example, a retail
business currently selling fabric in units of inches and yards
will, after conversion, sell fabric in centimeters and meters.
Similarly, a janitorial firm vying for cleaning contracts will bid
on office space based on specifications for square and cubic
meters.

Metrication in essence will create a new business language as well
as new opportunities for business growth.

Despite these new opportunities, some small business owners will
resist metrication. You should, however, convert as quickly as
possible. Why? The answer is simple. Those small businesses
among the first to convert to the metric system will be able to
obtain the benefits of improved competitiveness, market access and
standardization savings, while those who are slow to convert will
recover little, if any, of their costs. The conversion process,
which may involve some effort, is a procedure small business owners
must undergo in order to retain their share of federal contracts.
Any small businesses failing to make the transition eventually will
not be competitive in metric markets of the future.

The Process

Metric conversion is not necessarily a complicated process. But,
it will take time and careful planning to make the transition as
cost-effective and as efficient as possible. There are a number of
steps you can take to simplify the process.

First-Cut

The initial stage in metric conversion is called First Cut. In
First Cut you perform a quick, rough analysis to determine if
conversion is warranted.

Questions you should address are:

– When should you start developing a metric capability?
– How fast should you phase-in metric capability?
– What is involved in moving in that direction?

Once you have assessed and answered these questions, you are ready
to analyze the market to assure yourself there is or will be a
large enough market to justify the investment. Also during this
stage, prepare a cost analysis for an estimate of the costs and
prepare a preliminary phase-in plan to identify when to start
implementation. Your analysis should include:

Market Analysis

– Define goals and objectives
– Check metric products sales trends (foreign and domestic)
– Check suppliers, competitors and trade associations for
trends
– Identify types of product conversions and their impact on
servicing work
– Project customary vs. metric new business

Cost Analysis

– Add, replace or modify tools and service equipment
– Add, replace or modify inspection and test equipment
– When necessary, train employees in metric
– Maintain, store and handle dual inventories, but work to
reduce and phase-out non-metric items
– Revise service order forms and other documents
– Project total costs for developing metric servicing
capability

Preliminary Metric Phase-in Decision

– Review projected sales revenues
– Consider alternative phase-in plans for cost reductions
– Evaluate non-cost considerations
– Make preliminary decision

By analyzing these factors, you will be able to

– Identify new market areas,
– Determine if your market is saturated with small businesses
offering similar services,
– Estimate the initial cost and
– Outline a conversion method.

Planning

Next, start your Planning. This process usually focuses on four
major areas —

– Demand forecasting
– Service planning
– Personnel training and
– Paperwork changes

Gather the following data for each area.

Demand Forecasting

– Trends in converting products now serviced to metric
– Potential new metric product service work
– Sales literature
– Customer notification
– Continuing metric market research

Servicing Planning

– Tools and service equipment
– Inspection and test equipment
– Performance and testing specifications
– Metric supply sources
– Purchasing specifications
– Dual inventory facilities procedures
– Scheduling metric servicing phase-in (lead time
requirements)

Personnel Training

– Employee notification
– Training needs identification
– Type of training determination
– Training materials availability (including shop charts)
– Scheduling training

Paperwork Changes

– Service order forms
– Testing reports
– Parts/tools check-out forms
– Accounting records
– Scheduling procedural/printing changes

By working through the areas described above, you now have a
comprehensive, detailed metric servicing plan. But, before you
make a final decision, there are two additional cost factors to
consider.

First, consider whether you will need to borrow money to cover the
costs of metrication.

Second, consider the tax implications of your metric phase-in plan. With
this information you will be able to prepare a fairly accurate
cost projection, which can be incorporated into the financial
section of your business plan and used to justify investment costs
if you apply for a loan.

Phase-In

Now you are ready to begin the final stage of the metrication
process: Phase-In. A usual way to begin this stage is to schedule
a meeting in which you affirm your commitment to the metric
program. Employee motivation and support can be enhanced by
outlining the importance of the program to the future of the
company and to job security. Also, keeping employees informed
about and identifying their roles in the process will alleviate
fears and make the transition smoother. Remember, your employees
are a vital key to the success or failure of the conversion
process.

As your company changes to metric, it is critically important that
you keep a continuous check on how closely the conversion process
correlates with your plans. Many companies have discovered that
the most effective way of accomplishing this is by having frequent
meetings of task leaders to review the previous week’s experience,
and by generating a set of special reports for use by the leaders.
The contents of these reports should be tied closely to your phase-
in plans.

Metric Information

Excellent sources for further information and assistance on metric
conversion and the metric system are:

American National Metric Council
1735 North Lynn St., Suite 950
Arlington VA 22209

National Institute of Standards and Technology
Office of Metric Programs
Gaithersburg MD 20899

American National Standards
1430 Broadway
New York NY 10018

U.S. Small Business Administration
409 Third St. SW
Washington DC 20416

For More Information

Make it your business to know what business information is
available, where to get it and, more importantly, how to use it.
Several sources of information include:

U.S. Small Business Administration
– SBA District Offices
– Small Business Development Centers (SBDCs)
– Service Corps of Retired Executives (SCORE)
– Small Business Institutes (SBIs)

Consult your telephone directory under U.S. Government for your
local SBA office or call the Small Business Answer Desk at 1-800-8-
ASK-SBA for information on any of the above resources.

Other sources
– State economic development agencies
– Chambers of Commerce
– Local colleges and universities
– The library
– Manufacturers and suppliers of small business technologies
and products
– Trade and professional associations

All SBA programs are available to the public on a nondiscriminatory
basis.

About author

SMB Reviews
SMB Reviews 473 posts

SMBReviews is committed to providing small and mid-sized business owners with the information and resources they need to select the best service or product for their company.

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