Preparing to go on Vacation

time for vacationAs a small business owner, you might think it a nearly impossible proposition that you would get away for even a week on a “real” vacation, one that is not consumed by attention to business matters and then suddenly cut short by a business-related emergency. However, with advance planning and adherence to some basic protocols, it can really be done.

Some tips to help you have a vacation from your daily business duties without allowing your business to sink into a state of turmoil are given below:

  1. Vacation During the Lulls: Most businesses are subject to a cycle of busy and slow seasons throughout the year, and one way to ease the stress of worrying about your business while away is to schedule you vacation during a lull.
  2. No Major Moves While Away: It is best not to begin a major new project, like launching a new website or conducting a big marketing campaign, while away from the helm. Delay signing all contracts as well until you are back and able to scrutinize them in “non-rush mode.” “Major moves” often run into snags and glitches, and you may need to be there personally to deal with such problems.
  3. Delegate Duties and Preempt Problems: Appoint one employee in charge while you are away, and make sure everyone knows they are to follow his instructions. Also leave a list of how to handle various problems, such as computers breaking down, Internet connections failing, or the company website being out of commission. Let everyone refer to that list to handle emergencies when the person you left in charge is not available.
  4. Minimize Communications to the Essential: Have your employees send you only one email at the end of each day summarizing the day’s activities, problems, and successes. Let everything that only you can do, but that can wait, be printed and placed on your desk for when you return. If, and only if, it is a true emergency, should you be called on the phone.
  5. Don’t Call-Forward to Your Cell Phone: Instead of having you business line forwarded to your cell phone, have your employees handle the calls. Also use a voicemail that you can check when your return or at your convenience while away.
  6. Alert Clients You Will Be Away: For those clients you work with personally, alert them you will be unavailable for awhile. It is helpful if you extend the “unavailability” dates you give them by a day or two on each end. That way, those who call at the last minute before you leave won’t really be doing so, and you will also have a chance to catch up after you return before a flood of business calls come in.

You need to bring all your important business contacts and keep track of things through Internet and phone while away, but you must also balance that need with the need to make your vacation a time of rest and diversion. Otherwise, it’s just business as usual via long-distance methods.

The Power of a Business Mastermind Group

Mastermind Group

Mastermind groups are a relatively new concept to most business owners. A mastermind or peer advisory group is designed to help people navigate through challenges using the combined intelligence of others. How does it work? A group of smart, goal-oriented people meets on a regular basis to tackle problems and challenges together. These people lean on each other, share advice and connections, and conduct business together when appropriate. What are the benefits of joining such a group?

Challenging Yourself

Do you want your business to grow beyond your wildest dreams? You need to join a peer advisory group; it will challenge you to grow your company to its fullest potential. In day-to-day life, it is very easy to get distracted – when this happens you lose track of your goals and your business suffers. However, a peer advisory group would keep you from straying too far.

Accountability

As a human being, you need to be held accountable for your actions. Otherwise, you will just do what you want regardless of how it affects the business. At the end of each peer
advisory group meeting, you will have objectives and an action plan that you need to work on before the next meeting. The group will hold you to account for everything, because it takes true discipline to achieve anything in life. Being held accountable by your colleagues will help you keep your focus and succeed in your business.

Lasting Connections

The life of a business owner can be quite lonely. However, if you share your aspirations, challenges and dreams with a team of like-minded people, it will be less lonely. As you spend more time with your peers, you will share ideas and develop strong connections that can last a lifetime. Whether you are looking for lifelong friends or not, you will form lasting bonds with some people.

Brainstorming

As a group, you will be able to share your ideas and come up with better ways of dealing with challenges. If you are not sure which direction you want to go next, seek advice from members of the group. You might be surprised by how helpful your new group mates are. Consequently, you should not be reluctant to help your new team members.

Better Decision Making

When you are alone, it is easy to dismiss an idea as silly. However, with the support of a Mastermind Group, you will be able to make decisions easily. You will have your own due-diligence group to boost your confidence when you need to make an important decision.

Feedback

Get feedback on how to solve problems from successful individuals in your field. If you are facing financial challenges or dealing with staff issues, let your group know and ask them for help. Maybe one of the members has dealt with a similar issue and can offer solid advice. Remember that every person in the group has the same goal: to grow his/her business. There is no hidden agenda – you should all work together for the betterment of your businesses.

Support

Are you going through a hard time? Sure, you can discuss your problems with a close friend or family member, but they would not understand. When you are in a peer advisory group, you can discuss your challenges with a group of like-minded individuals who understand. Some of your colleagues might even be in the same boat. Therefore, you will never lack alternative suggestions on how to deal with your problems. Moreover, you will get sound advice that will stop you from making the same mistakes that your mastermind colleagues made in the past.

Expanding Skills

Each person in a peer advisory group has unique skills and connections. Therefore, it is safe to assume that everyone is an expert at something, and as you forge new connections with them, you will pick up new skills. If you all agree to teach each other something new, you will be armed with the necessary skills to make your business succeed. In such groups, individuals tend to raise the bar by challenging one another to implement goals and brainstorm ideas.

Hot Seats

What is a hot seat? The principle behind it is that each person gets a chance to present his/her biggest challenge to the group. In turn, the group will provide a series of solutions and options to follow up on, and the individual in the hot seat leaves with more ideas. If the mastermind group is too large, not everyone gets a chance to take the hot seat. However, the person in the hot seat might be dealing with the same issues as you, so pay attention. This might help you to gain clarity on the challenges you are currently facing.

Helping Others

When you give a person advice and he or she succeeds because of it, you feel a sense of gratification. Furthermore, offering advice to others gives you the perfect opportunity to forge new and lasting connections. When you help people, most of them will want to reciprocate in any way they can. Therefore, you should think of helping others as a way of earning future favors.

New Business Ideas

The generation of new business ideas is the biggest benefit of joining a peer advisory group. You will come across new ideas that are perfect for your business. The idea may not even be related to your business, but it might jump start something in your brain. Just being in the same room with superior brains in the business world should be enough to give you new ideas.

Increased Profits

The objective of a Mastermind Group is to help you to take advantage of opportunities that come your way. Once you start doing so, your profits will soar and your business will become a great success.

Now that you know why you need to be part of a peer advisory group, you should think about joining organizations that run them, including Virginia Council of CEOs, Entrepreneurs Organization, Team Nimbus, C12 Group, Renaissance Executive Forums, Sage Executive Group, and Vistage. The owner of 1-800-Got-Junk, Brian Scudamore, grew his company’s revenues over a five-year period from $201,532 to $8,057,563. He has won many awards since and been featured on CNN, Oprah, and CBS. What was his secret for success? He joined a small group of entrepreneurs. According to him, ‘the value of peer networking turned out to be more than great business advice’. Brian says that his
peer network enabled him to expand his business. Before he joined a Mastermind network, his profits were low. Why don’t you join a Mastermind Group too? There is no losing; you can only win.

Do You Have a 12-Month Business Plan? If Not, You Are Hurting Your Business

In the world of business, setting clear, obtainable goals and working toward them consistently until they are achieved is indispensable to success. Without a plan of action, the tendency is for your actions to become one of two things: rote and unmovable or random and spur-of-the-moment. Without a 12-month business plan, it will be nearly impossible to focus on your goals in the midst of a hectic business environment. You will inadvertently end up hurting your business for lack of a plan.

Why Is a Written Business Plan Necessary?

Committing your vision for your business over the next 12 months to writing will benefit you in a number of important ways, including the following:

  • Putting your ideas down on paper and/or into a PC will help you to focus on your goals and identify your highest priorities.
  • The finished plan will serve as a point of reference to give you direction as you strive to achieve your stated goals.
  • It will be a starting point from which you can adjust to the changing circumstances (update the plan), and insightful year-on-year comparisons will ultimately be possible.
  • A secondary reason to have an annual business plan is that investors/bankers who may be interested in loaning you some capital will want to see on paper how you plan to manage your business.

How Do I Set Business Goals?

Without clearly defend, specific goals, your larger goals will not likely materialize. Part of your business plan should spell out these goals, covering such areas as:

  • Marketing Goals: Increase sales to existing clients by 15% and increase retention of new customers by 30%.
  • Production Goals: Boost output by 5% within 6 months and by 10% within 12 months.
  • Financial Goals: Reduce overhead costs by 5% while raising the profit margin from 12% to 15%.
  • Environmental Goals: Increase the energy efficiency of my facility by 20% and install solar panels on the building’s roof.

How Do I Strategize and Forecast?

Not only goals but also a step-by-step plan of action to accomplish each goal should form a part of your annual business plan. These steps will then, in turn, guide your daily operations. These steps might, fore example, include things like buying new equipment or holding worker training meetings.

A final section of your plan should be a forecast of the “financial implications” you expect will result from the plan’s implementation. This should include a 12-month cash flow forecast and a profit/loss forecast that extends across two or three years. Monitoring actual expenditures against these projections will help you to keep to goal as much as possible.

Conclusion

As a final note, realize that your 12-month business plan is a tool and not a “straight jacket.” If you need to change it to adjust to a new situation, it is better to update the plan than to miss an opportunity. At minimal, you will “update” your business plan once a year, when you sit down to formulate your goals and strategies for the next 12 months.

Strategy Before Tactics By Arthur Radtke

It’s Monday morning: the start of a new week and we need to make some sales now!

We quickly begin to run through all the tactics that we know looking for the silver bullet that will solve our problem the easiest and fastest way possible. The problem is, this is the same situation we have found ourselves every Monday as far back as we can remember. And the fact is, we are relying on tactics to carry the day when we haven’t developed our strategy enough to even choose the right tactics.

Strategy is the overall plan one is going to execute and tactics are the individual actions used to accomplish the strategy. In football, as an example, a team’s strategy might be to control the clock.  The tactic used to accomplish this might be a series of running plays or short passes. In business developments there are two parts of strategy: first, who are your most likely and best customers and, second, what is your unique value proposition to these customers.

Your best customers are usually not as obvious as we first think. One might think that the best customer is the biggest but this might not be the case. Our best customers are ones that are profitable and excited about our goods and services. These customers are both profitable and reasonably low maintenance. Many businesses don’t know what their profit is on individual customers and retain clients that are actually losing them money. There is a huge difference between revenue and profit. Resist the temptation to broaden your target market. The broader the target market is,the harder it is developing a compelling value proposition.

Once you are clear what the nature of your target market is, you then need to develop the value proposition which is critical to them. The value proposition needs to be one that answers a need of that target market. Example: if your client is a mid-size business that doesn’t have training resources, you might supply the training that they need.  Or if they are challenged to distribute their product, you could do this for them. You need to use the fact that you are an “expert” to your clients’ and prospects’ advantage. You aren’t looking to make a sale but to develop a true partnership with your clients.

With our strategy now in place, we are ready to develop the tactics needed to reach our prospects.  The tactics should take care of two initiatives: first, prospecting and second, converting the prospects we have.

Your Unfair Advantage – by Art Radtke

You have one. You may not know it, but every business owner and sales professional has one. You have a claim to something that makes you truly unique in your industry.  You have something to offer your customers that they cannot get from anyone else.  That something is your unfair advantage.  Do you know yours?

“We have the lowest prices.” Really?  Lower than Walmart’s?

“We offer better, more personal customer service.”  Would you accept a tire being returned to your store if you did not sell tires?  Whether real or urban legend, this very story is a cornerstone to Nordstrom’s reputation.

“No one can beat our selection.”   Can you prove that?

Your unfair advantage does not lie in any general claim to price, selection, or service. Your unfair advantage lives in that which makes you more than just another realtor, broker, deck builder, web developer, or shopkeeper.  It lives in the realization of what it really means to be a local business owner in your community. Once you can articulate that, you will be able to bring a whole new life to your business.  Your mission – should you choose to accept it – is to find out what it is and own it. “It” is where your power lies.

Nancy is a realtor in Marblehead, Massachusetts, who does not sell “houses.”  She offers a lifestyle.  Marblehead is well known among hard-core sailors as one of the premiere sailing communities in the country.  Top-notch sailors and Fortune 500 executives who love sailing flock there because of the incredible sailing environment.  Nancy knows this.  That is why before taking her clients to any listings, Nancy shows them the area.  She takes them to visit the yacht clubs.  She shows them various mooring options available.  She takes them sailing.  If you love the sailing lifestyle, there is only one realtor who can plug you into that community.   Nancy turned her passion for sailing and the lifestyle that surrounds it into the focus of her real estate business.  It is her unfair advantage over anyone else trying to move homes in that area.  Are there homes sold in Marblehead by agents other than Nancy?  Yes.  There are just not many with clients who came there to sail.

In a great comparison, here is another realtor I know with a different unfair advantage.  Momo specializes in finding housing for the elderly. When elderly people are ready to downsize or make a move into assisted living, she helps them sell their current home.  She knows this is very often a difficult transition for families, so she makes a point to keep the transaction as simple and painless as possible.  She also will personally connect families with other businesses she know that offer services they need to get through the move easily.  Her heart for the elderly is the core of her business.

Understanding the concept of your unfair advantage is not difficult.  Where business owners typically fall down is in not “activating” that advantage in their business.  My hunch is greed is the biggest factor. Ugly as it may sound, small business owners typically feel that to be successful we need to “have it all.”  We live under the misguided notion that in order to thrive we must serve as many people as possible, so we need to stay as general as possible.  We believe that moving our business towards our unfair advantage could effectively turn some people away.  My experience shows most small business owners shy away from anything that even smells of leaving money on the table.

Yet, if you are truly trying to yield more money from your business in less time, the quickest, most efficient way to do so is to take advantage of your unfair advantage at ALL TIMES.  For this to work, you must be willing to stake your reputation on “it.”  You need to narrow your focus.  The reality is to grow bigger you need to go smaller.

This can be done in a couple of ways.  One is to have a passion like Momo does for the elderly.   Another is to focus your business geographically (like Nancy in Marblehead) by being “ultra-local.”  Being local is an unfair advantage every small business owner has over big business. Do you love where you live and work?  Do you have strong ties to your community? Then use this to your advantage.  If you are a business-to-business company ask yourself, “How many businesses are within a one-mile radius of me at this very moment?”  If your market is more residential or consumer-driven, find out how many neighborhoods are within a one-mile radius of you right now.

Going after larger markets is an exhausting and expensive process. It requires more physical travel, is harder to wrap your arms around, and keeps you “busy” but not necessarily productive.  If you were to focus your efforts on people or businesses within one-mile radius of where you are, think of how much easier it would be to get things done.  “Going ultra-local” also strengthens your visibility in your immediate surroundings.  The farther out you reach, the less focused your efforts are and the weaker your exposure becomes.   Concentrate on that for a moment…

Going ultra-local also provides you the perfect environment for making your business ultra-personal.  By making your world smaller, you create the time you need to really KNOW your customers.  You find more time to visit clients, to hold more appreciation events, and to deepen relationships in ways previously not possible.  The beauty of this is at the same time you are getting to know your clients better they are getting to know you too.  Your unfair advantage lives and breathes in the strength of these relationships. Larger, more complicated companies and major corporations cannot do this.  Be local.  Make it personal.

In addition to the fear of leaving money on the table, small business owners trip themselves up by not seeing the forest for the trees.  Pizza Hut hands out coupons for free pizza to elementary school students with an A on their report card. Tony’s Pizzeria, right around the corner does not.  Why?  Tony either sees “giving away” pizza as too expensive, or more likely, he never gets around to making it happen.

Tony is missing a main accountability ingredient: a boss.  Pizza Hut has a local manager that has a divisional manager that has a regional supervisor that has a corporate VP pushing the process down.  Tony is focused on keeping the doors open and his employees employed every day. He does not see how free pizza could position him as a champion of education in his community with advertising that is paid for only when it works.  Nine parents out of ten would choose Tony over Pizza Hut, if he would not let the big guys out-localize the local guy.

Make it local.  Make it personal.  Make it happen. One of the great things about being a small business owner is you can choose whose rules you want to play by.  If you want to do business solely with customers within 1 mile of your office, you can.  If you want to sell homes only to people looking for waterfront property, do it.  If you want to build a business that provides work for stay-at-home-moms, that is your business.  Not only can you choose what you want your business to be, you have the unique ability to turn on a dime.  You do not have layers of bureaucracy and corporate decision-makers to muddle though.  It is your business. Just make it happen.

My daughter and I daydream sometimes about opening up a coffee shop together. Our whole purpose in being would be to promote the other local businesses around us.  Instead of pretty pictures on the wall we’d have the local fishing report and the day’s weather forecast.  We’d be known for being a “non-virtual” communication hub of our small town.  It is our own ultra-local opportunity.  It feeds our desire to help small business, to be a part of our community, and to do something meaningful together.

What is your unfair advantage?  It is a fair question.   Work it out.

The Math of Sales: (SxA) x U=R By Art Radtke

It is often said that sales is a “numbers game.” Although this is true on one level, it does not clarify how to improve one’s sales performance. We must dig deeper.

The numbers game is described simply: you just need to see more people. In most cases, this is accurate; very few sales professionals see enough prospects. The challenge with this view is that it can be very discouraging. If one’s closing percentage is too low, it could take an impossible number of contacts to reach an acceptable level of production. To tell a salesperson, “Just go see more people!” tends to discourage more sales people than encourage. This is demonstrated by the number of sales people who fail to see enough prospects. The better solution is to promote the mathematical formula of success expecting that, if we understand the formula, we will gain the perspective that allows us to move forward.

The Formula:
(Skill x Action) x Urgency = Results

This formula gives us more perspective on how to improve our results. When our skills of closing or ability to connect with the right prospects are lacking, no amount of effort will make us successful. Equally true is the fact that no amount of skill will make up for lack of action. The two work together to create the results we want and the way to maximize them is to create urgency. Now let’s take a closer look at each of these items.

The Merriam-Webster Dictionary defines skill as, “the ability to use one’s knowledge effectively and readily in execution or performance.” Sales skills are like any other skill; they can be developed by purposeful effort. As the musician can improve his/her ability to play difficult arrangements or the golfer can improve his/her ability to putt, the sales professional can improve ability in each of the sales skills. Interestingly, the musician or golfer, when he doesn’t get the results he wants, knows instinctively that he needs to improve his skill level and will, therefore, practice intensely to develop the needed skill.

The sales person, however, will often come to a different conclusion if his strategy didn’t work. Once he has come to this conclusion, he moves on to the next strategy, rather than developing the skill he needs to make the first strategy work. This leads to a continuous search for the right strategy rather than the development of the correct skill set. Though that a good strategy is important, I believe it is impossible to measure the effectiveness of a strategy until it is executed with an acceptable level of skill. We tend to move from one strategy to the next so quickly we never develop the needed skill.

The Merriam-Webster Dictionary defines act as, “the doing of a thing.” The acts of selling are the steps we take to reach our desired result. The better these steps are planned and the more often they are done, will increase our results within the limitations of our skill. The most common actions that a salesman needs to take are: 1. Prospecting, 2. Relationship Building, and 3. Presenting and Closing.

The result of the two variables Skill and Action, are multiplied by the state that we are in at the time we are executing them. According to John Kotter, the author of A Sense of Urgency, we all operate in one of three mental states: 1. Complacency, 2. False Urgency, or 3. Urgency.  Mr. Kotter maintains that complacency exists when we feel that we have it figured out and, thus, don’t have a lot to learn or change. This feeling traditionally comes when companies or people have experienced success and can lead to the possibility of losing their competitive advantage.

False Urgency is the state of fear that bad things are going to happen and we act out of panic or depression when in this state. While complacency comes from experiencing success, false urgency comes from a person or company experiencing loses. True urgency comes when a company or individual sees opportunities that excite them, it is in this positive and optimistic state that we multiply our skills and actions, creating results that seem to be greater than the effort put in.

The greatest change in results comes when we maximize our skill development and actions by the positive energy of true urgency. Thus, the greatest change we can effect is through the elimination of complacency and false urgency and the creation of true urgency. When we do this the results we create are both larger and quicker than we expect.

Know Your Numbers aka “Dave Thomas’ Buns” – by Art Radtke

Most people who know me know I’m not a big sports fan.  I do not have a favorite team.  I do not watch sports on TV.  I do not necessarily know or care much about who plays for whom.  What I do know, and greatly respect, is the object of the game.  Why?  Sports analogies offer great insight, as they are significant metaphors for the small business owner and independent sales professional.

Imagine, any one of the football players on a field not knowing what the score is or how much time is left in the game.  Consider a soccer player who has no idea of the skills of the players he is playing against, or a basketball player who takes his time walking down the court, his team down by two points with one minute left to play in the game.  My point is: Regardless of the sport, athletes know the score.  Do you think Tiger Woods ever steps up to the tee without knowing where he stands or how best to play the hole?  Athletes of every discipline are well versed in the level of skill needed and the amount of time left to play in the game.  As spectators it is the very least we expect of them.  It is their job to know where they stand so we can enjoy watching the best play at the top of their game.

So, why do we not carry such high standards for our own business?

The truth is most business owners are clueless about their own numbers or statistics.  They could be losing business for months and not even know it.  I know an employer in New Jersey whose business was being embezzled for more than 6 months before they ever realized something was happening.  That should never be.  As a small business owner, it is your job to know immediately when something is not right.  You should know immediately if your numbers are not making sense against your averages. It is your business to know your business.  If you were playing football, when would you want to know you were losing the game?

Most business owners sit down with their accountant or bookkeeper at the end of the month to review their “financials.”   This is a very important process, but not what I am talking about.   What I am asking you to do in addition to reviewing your financials at the end of the month, the quarter, or the year, is to determine the “one” number that is the key indicator of how your business is doing every single day.

Dave Thomas, founder of Wendy’s restaurants, discovered his number was “buns.”   Thomas figured out that tracking the number of buns used every day was an indicator of what was happening in his stores at any given time.  He found that the number of buns sold each day would not only show him how many sandwiches were sold, but also how many were chicken, how many were burgers, and even how many crossed the counter “bunless.”  He could determine how many fries, Frosty, salads, and drinks were sold.  He could determine how much condiments were used.  Basically, Dave Thomas had a solid grasp of the health of his business simply by counting the number of buns used each day.

How does this work?  Averages.  Thomas knew that knowing the number of buns sold would allow his set of averages help him determine the rest.  Let’s say 300 buns were used.   Then knowing that 1 out of 10 sandwiches are sold without buns, 30% are typically chicken and 70% are burgers, he could do the math.  Thomas could get to almost any number in his restaurants by simply placing his averages against the number of buns used that day.  Though the number may not be exact, it got him close enough to use for planning and strategy purposes.

For instance, pretend Thomas noticed that instead of 300 buns, he sold only 260 in the month of September.   What happened?  By looking closer, he noticed the number of buns lost was mostly around the noon hour.  They started to rise again after 3:00PM.  Could it be that school was back in session?   One year later, he sees the same 12% drop in the number of buns.  He now knows nothing is wrong.  It is a seasonal fluctuation that he can use to make more educated projections or even spark a series of after-school promotions.

It is shocking how close you can get if you know your averages.  What keeps most business owners from delving into this kind of math is fear.  There are so many moving parts to anyone’s business it can be mind-boggling to know where to start.  Your number will directly relate to your type of business as well as to your type of personality, however, most of you can begin by finding yourself in either one of two categories.

The first category or type of personality is the truly commissioned, sales driven professional  that is not operationally driven.   Most sales professionals will track actual sales.  What they too often neglect is delving into what actually got them there.   Since the sale itself is at the end of the sales cycle, it is hard to make changes based on that number.  By that point “what is done is done.”   To be able to affect the outcome of your sales numbers, “your number” should be as early in the sales process as possible.   Can you answer these questions for your business?

a.How many calls do you make each week?
b.How many appointments do you get from those calls?
c.How many proposals or presentations do you typically get from those appointments?
d.Do you know your closing ratio?
e.What is your revenue per product / sale of service?
f.How many clients do you lose due to businesses going out of business or personnel transfers, etc.?
g.Do you have recurring revenue streams?

Even if yours is a 20-step sales process, you want to choose the number that is as close to beginning of the process as possible.  For example, if you know you need an average of 5 scheduled appointments in one week to make one sale, do you know how many calls you need to get those 5 appointments? That is where you begin.

Once you know – or at least have a good idea – of where you are starting, you can begin to determine where you are at any given point along the process.  Using the same 5 appointments, if all were kept, but no sales were made, could you determine what went wrong?  This is the point where you need to do a little research …

• Were there competitive specials?
• Were your presentations lousy (bad week)?
• Has the marketplace shifted?
• Was the quality of your appointments off (not the right people)?

The point is to look as deep as you can to determine what your numbers mean.   Chalking it up to a “bad week” over and over again will not serve you.   It can actually pull you into a downward spiral from which it is difficult to pull out.

Whatever your goal, you must continue to operate within it.  Work to get the job done.  In my experience, “most business people are willing to put in the hours;  it is the work they are not willing to do.”

For the second category of business people – those with operational staff – the idea of following a process still holds true.  However, this type of business is better suited by not following the sales process.   An automotive dealership is a great example.   At first glance you might think you need to count the cars on the lot.  However, that number is 100% dependent on the number of sales people on the floor that day, the number of walk-ins, the number of test drives, your level of inventory, even the weather.  There are too many variables involved for you to be able to gather the information you need. However, choosing a non-sales number – such as the number of service appointments – in any given month can provide you a wealth of information.  It shows the number of people satisfied, or dissatisfied with your dealership in general.  If your service appointments are slipping, chances are you will not be getting these “buyers” back for another car.   Non sales numbers are steadier, less volatile and more apt to give you a truer reading of your situation.

There is not a single number that will tell you what is wrong, but there is a number that will tell you something is wrong.

The bottom line is this:   Know the significance of your “buns.”  Find a number that can become your leading indicator of the health of your business.   Keeping track of that one number will indicate the movement of the rest.  Although one single number may not tell you what is wrong, if you know you are losing the game in the second half of the last quarter – at least you know something has to change.  Most business owners do not get that far, until it is too late in the game.

9 Stages of a Business – by Mort Murphy & John Heenan

Defining the stages of the life cycle of a business is not new. However many of the descriptions have traditionally been presented from the large corporate point of view, which does not reflect the reality faced by small businesses. The following table gives the stages of a small business lifecycle.

9 Stages of a Small Business

1.    Concept

2.    Start-up

3.    Survival

4.    Stabilized

5.    Doing well according to outside appearances

6.    Doing great according to outside appearances

7.    Obviously has moved to the next level

8.    Maturity

9.    Succession

The small business lifecycle stages focus on the impact that the life of the business has on the life of the owners/managers. There are three additional stages in the small business lifecycle because of this. Let’s take a quick look at the stages.

1. Concept – This is definitely one of the most enjoyable stages. There is great fun and great enthusiasm. This is all about creating the vision.

2. Start-up – Trying to turn the vision into reality. The biggest challenges are trying to source funds and get it all together.

3. Survival – Outside finds have dried up. The business must quickly start generating cash by bringing in paying clients. Quiet desperation sets in – “I never knew it was going to be this tough.”

4. Stability – The business is generating enough cash to survive. The owners are earning a wage. Everything in the business depends on the owner. However, s/he is so relieved to have survived that s/he breathes a deep sigh of relief.

5. Doing well according to outside appearances – Business is thriving and sales are expanding. The owner is a “Hands-on” manager. S/he is drawing a good income; however s/he has no time to enjoy life. “If I stop the business stops, I feel like I am on a treadmill.”

6. Doing great according to outside appearances – Both sales and the business expand. The owner operates on a basis of management by “walking around”. Owner has a great standard or living. But if s/he is away for a week, the whole place is in turmoil. The owner is exasperated because of conflict of having to be in the business and not having the time to enjoy the lifestyle created. Quiet desperation undermines owner’s confidence, and they feel s/he can’t get out from under it.

7. Obviously has moved to the next level – Owners have got full-time management in place. Life is now rosy. They can enjoy the fruits of their labor. They can do what they love to do in the business or take time off if s/he wants. Only major responsibilities are providing vision to the business and providing direction to management.

8. Maturity – Owner can now retire – own himself/herself and not worry about the day to day running of the business. His/her only responsibility is to provide vision to the business. Free at last to do what s/he loves to do.

9. Succession – Owner has successfully passed on the business to the next generation of owners and is completely free of the business and has the wealth to enjoy the lifestyle s/he wants.

What do the 9 steps mean to owner managed businesses? There are a number of ways that owners can use this information in helping them run their businesses.

(a) Craft Vs Assembly – Many of the earlier stages are epitomized by the owner holding all control to himself/herself. This makes sense in the context that s/he is trying to realize his/her vision.
However is it only when the owner begins to take on board what Adam Smith said in the “Wealth of Nations”, that s/he begins to truly realize the vision and also to enjoy the business and the fruits of the business seem to have been the efforts of the division of labor.” Adam Smith said “the greatest improvement in the productive powers of labor and the greater part of the skill, dexterity and judgment with which it is anywhere directed, or applied,
When the owner moves over to the assembly method of achieving his/her vision they can achieve a masterpiece, just as Michelangelo did. When the Vatican decided a number of years ago to clean centuries of smoke and pollution from the Sistine Chapel ceiling they discovered something amazing. The painting had been “painted by numbers” or more specifically in this case, “painted by dots”, Michelangelo’s vision was achieved by assembly and business owners can do the same.

(b) Plan Better – Business owners, by recognizing the 9 stages can plan how to navigate their way through them more successfully and with less feeling of desperation. They will be better able to enjoy their business because of this.

(c) Be more ambitious – Many business owners reach the stabilized stage and stay there out of fear. It’s like sitting on a comfortable cliff edge – lucky to be there, but afraid to get back up and start climbing again. With an understanding of the 9 stages, they can build safety nets to support them as they start to climb and now the path is clearer.

(d) Better understand the kind of support that they need – By understanding the 9 stages the business owner can be more assertive in their demands of what they expect of business development support firms. If these firms don’t understand the 9 stages, they probably don’t understand the situation that business owners find themselves in.

Going forward every business owner can give himself/herself a much better advantage of being able to enjoy the life s/he wants and deserves by using these 9 stages of the lifecycle of a business as a guide to getting there.

USA Today: How an annual plan can help your small business grow

100-Days-to-Abundance-small

From USA Today

How an annual plan can help your small business grow

http://usat.ly/1I6ZjLA

As Rhonda Adams points out in second article of her Small Business Week series, the value of planning is what you learn in the process. You can make better decisions, execute more effectively and seize the better opportunities. All critical to successful business growth.

Is it Business or Physics or Both?

100-Days-to-Abundance-smallOne of the things that hinders many moving out of corporate jobs and careers and starting their own small business is the assumption that what works in big business, works the same in small business.  Only on a smaller scale.

Well, that’s not necessarily so. Let me share an example. In big business organizations, great emphasis is placed on planning. Planning, planning, planning. And rightfully so. In a big business, implementation done on a large scale is costly. If there is a mistake in the plan or the implementation process, it will most likely be equally or even more expensive. A big business wins by investing as much time in planning as it takes to insure the plan is “perfect.”

Time is the most costly resource for a small business and speed of execution is an inherent competitive advantage. Too much time spent getting the plan “perfect,”, burns up your most valuable resource, at the expense of your competitive advantage to avoid a mistake that will have a relatively small impact on your business.

Additionally, the fastest way to perfect the plan is to use the feedback you get from execution. The size of your business allows you to make those changes and course corrections quickly in a way that a big business cannot.

execution1-e1426643768684

This is just one example of what we call Quantum Business in 100 Days to Abundance.  There are a number of Quantum Business principles, and we explore them and how you can utilize them to produce quantum growth in your business.

So the answer is it’s really business, specifically small business,  but I use physics analogies to explain it in 100 Days to Abundance.  If you use Promotional Code Retro100 and sign up for by March 29, 2015 for any of the programs scheduled for 2015, you can get it all for only $100.00.  After that it’s $349.00