ohiobeekeepers | Small Business Ideas

Is your company doing well? Are you profitable? How much longer will it be until you are? Where can you cut expenses? What are your most profitable products or services? Which are the least profitable? What the shelf-life of a particular product? How effective is your marketing strategy?

As business leaders, this type of information is the type of information that we need to have on hand in order to make decisions about the company. Planning solely on what is in the bank, or focusing only on one aspect of what makes your company a) successful or b) keeps it out of closing is a very poor way of operating. This is pure tunnel vision.

If you consider, for a moment, two tools that are widely used in the business world – Porter’s Five Forces and the SWOT analysis, you’ll notice that part of the analysis is based on things that impact the business – are outside of the business’s control. As business leaders, you know that strategically, this cannot occur just in exercise, but must exist in the way that you do business. Monitoring, making adjustments and acting must be an ongoing mentality if your goal is to build an extraordinary business.

Several recommendations we have made to clients include:

1. Understand what questions you want to answer. Here are some samples:
2. How do we know when we can purchase a new building or expand capacity
3. How do we know how effective our sales people are
4. How do we know how effective our marketing and other business development activities are
5. Understand what kind of data you need to collect in order to make your decisions. Typically, these are going to be things such as your financials – sales, cost of goods sold, expenses, profit, investments, interest and taxes, your business development activities, manufacturing costs and rates, etc.
6. Determine how to collect the data – including what is feasible. Take into consideration how you operate – does it need to be mobile? does the information need to be housed in a cloud?
7. Determine how the data needs to be delivered. If you have a ton of data and like to drill down from “high level” analysis down to the details, perhaps you want something more visual. If you like to play with the numbers yourself and run scenarios, perhaps you like to play with the raw data.

1. Decide how much your level of investment. Consider this:
2. No Investment – If you don’t get the data to make decisions, the likelihood of success is minimalized.
3. Your Time – If you collect and mine the data yourself, what else could or should you be doing to build or grow the business.
4. Your Resources – You could have a qualified employee collect and mine the data for you.
5. Your Money – You could invest in a software solution – be it customized, off the shelf, or a combination of the two – that could collect the data. We have used and recommend a product called Work, Etc., to centrally house most transaction that occur in the business in order to give us a single data-collection source.

Being clear about why you want to be in business for yourself is absolutely critical to your success. If you go into it for the wrong reasons or with false expectations, you’ll most likely fail. Even if you don’t, you’re going to have a much harder time along the way.

Brian Head an economist for the Small Business Administration Office of Advocacy says the top three reasons most businesses fail are:

1. Starting a business for the wrong reasons, such as having the illusion that it will instantly make you more money and have more time off.
2. Poor Management.New business owners frequently lack relevant business experience and management expertise in finance, selling, hiring and managing employees.
3. Insufficient Capital. Business owners frequently underestimate how much money is needed and how quickly they can establish positive cash flow.

When I looked at these 3 reasons, I truthfully didn’t think much of them. They made sense, but I didn’t think they were very relevant to me or my business.

BOY WAS I WRONG!

You see, I didn’t start my business for any of the reasons listed in #1. I started my business because I wanted to make a difference on a far larger scale than I could working for someone else. In addition, I was sick of working for other people, letting them determine how much I was worth, controlling my time and a good part of my life.

I was truly under the illusion that I would make tons of money quicker, could work a great deal less and have a much easier time of it.

Once again, I was wrong on all counts. None of that happened. In fact, the opposite happened. I have worked harder, longer and for less pay than I would have made working for someone else. I also made myself very, very sick and was on track to having a heart attack.

I share that with you so that you can learn from my mistakes, bypass them and shorten your learning curve dramatically.

So here are some things for you to consider.

1. Why do you want to go into business or why did you originally go into business?

2. What were your hopes, dreams, aspirations? Be honest with yourself. Are you on track or have you been stumbling, fumbling, and bumbling your way through?

3. Is the business you’re in truly fulfilling?

4. Are your expectations being met?

5. Are you making the money you thought you’d be making? If not, why not?

6. Is your time your own, or are you a slave to your business?

The point is, you have to know what you want to get out of your business and make sure that your business is providing that for you. If it’s not, then take whatever action is necessary to make it happen.