Why is it that some businesses succeed and others fail?
Some people lead charmed business lives whilst others have to really work just to avoid going under.
What is the difference? What is the secret? What makes them successful?
You’re not going to like the answer. But it will help.
You see, the secret is something we all know, but forget. It’s one of those “yeah, yeah, I know these things”. It is easily glossed over. It is easily ignored. BUT IT IS CRUCIAL.
Business is very simply about profit. Simply said but not so simply done perhaps? It is for some – and it can be for you too.
Okay then, so how is it done?
Some things in business are a total drudge. Tedious beyond belief. And most people get on with the interesting stuff instead. Customer focus IS important, and fun – customers are people and they’re always interesting. Having a good product IS important. People are buying it so it had better be good or you’ll be the most hated person in the world. Products are fun. They are your “babies” your creations even if only because you picked those specific ones to sell.
People and Products aren’t THE key to growing your business. There is a step that must be done first if you are to succeed. It’s the drudge one.
When I was mentored by a multi-millionaire that owned more commercial and residential property than I could visit much less own or even manage, the first thing he had me do was a budget. Income and expenses. What did you make? What did you spend?
I knew all about budgets. I’d done them before.
I failed to notice that I’d never gotten rich out of how I’d done them before.
I followed the letter of the law, as I understood it. I did a budget. Every month. For what seemed like forever.
That’s a lot of budgets. A lot of work.
But it turns out it isn’t the amount of sweat you put in. It isn’t how hard you work at it. It isn’t how deserving you are of success. It isn’t the doing that counts. It’s what you do with it that counts.
Okay. You probably already knew that but it takes me some time to catch on.
To grow a business you need to examine your current income and expenses and you don’t just budget for “next month will probably be similar”.
It’s your business. You run it. You’re at the helm. There’s rocks to the left and smooth seas to the right. If you’re drifting to the left, “probably similar” won’t get you to smooth seas.
The secret to growing a business (even keeping it afloat) is to do the books, examine the cash flow and do some steering. “More of the same” always leads to the circumstances you are currently in. No steering equals going nowhere.
You need to work out your income and expenses each month AND THEN see what you can change.
If you can cut expenses somewhere, you make more money each month and the business can get bigger. You have to know what you are spending to know what you can cut.
Cutting doesn’t have to mean getting less. It can be getting just as much but at a better rate. Shop around. How do other people do this? Does it cost them as much as you’re paying?
If you don’t do the drudge work up front you don’t know what your main expenses really are. A gut feeling, a “its probably …” can lead you to a lot of wasted effort. Fixing the phone bill when your internet costs are out the roof may feel good but it will achieve little. Growing a business requires focusing on the things that matter.
There’s a second part to the income and expenses, to the cash flow report. That’s the income. You can only cut expenses so far. At best you can get close to zero. But then there’s nowhere to go from there. Business growth depends on growing your income too. That doesn’t have a limit like expenses does.
You need to look at your Income and do some steering there too. Okay. This, this and this are doing well. What about that one? How can we improve that in the coming month? What would cause that to contribute more?
I hope this has got you thinking and your future is looking rosier.
Remember it isn’t the nobleness of how hard you sweat over the books. That doesn’t count for anything. It only gives you less time to do something with the information.
If you’d like to cut out the effort and focus on making your business succeed, you might want to check out our tool to do the income and expense drudgery for you.
It costs $US 25.00 and you’ll easily recoup that as you save time every month thereafter.
[GSSPAYPAL product=”EziCashflow” text=”Sure. I want to save time and make more money.”]