“If the economy is supposedly recovering, why does everything feel so sticky?”
If this sounds familiar, you’re not alone. It’s tough out there for many reasons. Cash flow is tight. Customers stretch out terms. Vendors press to get paid sooner. Employees are contributing, but looking for direction and wondering about pay raises. Banks are slow to approve loans and demand a ton of patience and paperwork for an uncertain outcome. Old customers ask for concessions that eat up profits. Competitors are going after business they never seemed to care about before, eating up opportunities you used to count on.
To thrive in this recovering economy it’s going to take more than just being good at what you do. Now is the time to perfect your business. Small-business owners who survive and thrive in the next few years will be the ones who go to school on how to be excellent all-around managers of their companies.
Here are just a few of the skills required to thrive in the new economy. Everyone on the same page. Sales to the right customer. Marketing on the Internet. Self financing. Invoicing, collecting, managing profits and banking relationships. Eliminating waste. Getting the most out of every employee.
Write up an overall game plan to follow. Be clear about where you want the company to be a year from now. Focus on activities that will drive enough profits so that you can pay everyone a fair wage, yourself included. Include checklists of who will do what and by when.
You want a steady flow of customers whose demands match the services available from your company. Review historical performance. Get rid of unprofitable accounts. Focus on meeting the needs of customers who value and pay willingly for what your company does best.
Build up sales skills, just like you build muscles at the gym. Practice every day. Make a list of things to improve. Build systems to make it easier to teach the next person: steps of the sales process, criteria to recognize a good prospect. Get into training.
The Internet world is the company’s top tool to attract new business. Make it someone’s job to build virtual communities. Get customers and prospects connected so can they ask you for the services they need when they need them. Teach managers to plan out what’s in the pipeline, from virtual community size, to requests for services, to revenue realized.
If you feel out of the loop on the Internet, stop making excuses, get on board. You’ve learned to do harder things. Making progress with Internet marketing can be easier than you think. Ask your kids, hire a college intern, read books. Spend an hour a day learning about this rich world of the future.
You’ve probably spent time cutting out waste over the past couple years. Take another, harder look. Get the company as lean as possible.
Look closely at which employees are your future, not your past. If it means cutting back short term, so be it. Decide what skills the company will need a year from now and ask people to step up or step out. Reward the contributors.
Include in your plan putting money into savings every week, along with slowly and steadily paying down debt. Set some rules about how much cash your company keeps on hand at all times. Three to six months of overhead expenses is a good goal. Work toward being able to self finance your company’s future.
Those of us who have been in business awhile have seen business cycles come and go. No doubt, for many of us, this is the worst it’s been in a long while, maybe ever. What we have going for us is an up-and-running business. It’s time to turn that into a finely tuned machine before the next generation of entrepreneurs comes along to try and take over.
