When times are good, it can be easy to rely on being good at what you’re doing in your business and hope that’s enough to see you through. It’s when times are tough (like the onset of a global freaking pandemic) that many business owners realise simply being good at what you do won’t cut it. You need to become good at business, writes wealth expert Melissa Browne.
The problem for many business owners is where to start. It’s also having the courage to make the tough decisions necessary to not simply weather current storms but to make it through with a stronger and perhaps radically different boat. If you know you need to fast-track your skills on being great at business, here are five places to start.
Too many business owners are holding fast to a strategy they created pre-Covid. No doubt because up till now, it’s worked well for them or maybe it’s because they’re hoping things will get back to ‘normal’ soon. It’s time to realise that we’re in a new world, we have no idea whether things will ever go back to ‘normal’ and we need a new plan for that.
More than ever before it’s important to look at why you exist, how you are different and align every touch point of your customer experiences with those two fundamental things. I believe important questions to look at when it comes to strategy includes choosing the one thing you’re going to be best in the market at and choosing the things you’re going to be consciously bad at. Too many business owners try to be all things to all people and end up being incredibly mediocre at all.
Most business owners can quickly recite their sales figures and yes, sales are important but they’re such a small part of the picture. It should also be about understanding your profit, your level of debt, wages ratio, your cashflow and how long it takes you to get paid.
I’m working with business owners who as a result of understanding these numbers, may still have had significant revenue decreases since March but their profitability hasn’t taken the same hit. That’s because once you face your numbers you can start to do something about them. That might mean swapping, pausing and cancelling expenses including that large ego office which is sitting half empty that you’ve realised you don’t need.
If you’re the type of business owner who calls your people your family, it might be tough to consider whether you need to let some go. But with stimulus payments dropping or ending and the cashflow boost for business over, it’s time for many business owners to make some tough decisions. That might mean removing a layer of middle management you’ve realised you don’t need or reducing hours for some team members permanently to part time. The most important thing is to not unnecessarily delay these tough choices, they don’t get easier just because time passes.
My local mechanic was asked for the first time during Covid-19 if he offered buy now pay later services. He doesn’t, but he should. That’s because what your customers wanted and how they behaved pre-Covid is potentially going to be different to what they need and how they’re interacting today.
It’s vital for business owners during this time to be in regular contact with their customers to understand what they need, to realise the trends that customers are embracing as a result of covid and choosing what you’re going to adapt in your business as a result. That might mean offering more flexibility with how you’re paid, it might mean bundling or unbundling your products or services, it might mean looking at how you’re interacting with your customers online, it might mean adding a cheaper version of your product or a more expensive option that your customers can pay off over time because their needs are now more complex.
One of the most important things you can do today in your business is to protect your cash. The government have announced stimulus measures will end at the end of March and business owners need to ensure that they are stashing cash so they have a buffer to see them through.
This means opening a separate bank account and saving at a minimum three months’ worth of working capital, understanding your cash cycle and making strategic decisions to reduce it. That might involve invoicing earlier, implementing a debtor system or putting efficiencies in place to ensure you get the work done faster.
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