Today I am going to help you unstuck your business! Many businesses may get stuck in a period where they are no longer growing, and when they aren’t growing, they are dying. Listen to today’s podcast to UNSTUCK your business!
This is one of our teaching episodes for the podcast, and I look forward to these by nature. I’m a teacher and I’m a communicator. I like to take very complex things and make them simple and that’s, I think, my giftedness and what I do well. And so I try to do to those lessons once a week because the goal of the podcast is to equip, educate, and encourage entrepreneurs. No matter what stage you’re in, maybe you’re thinking about starting a business or you have one that’s not doing as well as you would like, or you have one that’s just fantastic and you just enjoy the podcast, whatever it may be.
What I want to talk about today is,
How to Unstuck Your Business
If you’ve ever been stuck before in your life, like in a vehicle in the snow, where you’re stuck and you can’t get any traction, you can’t get anywhere. Businesses also have a tendency during their life cycle to reach a point where they’re stuck and they’re just not progressing in any way. And sadly, what I have found is when a business does get stuck and if something doesn’t happen, then they just go backward. They just start losing money and losing customers. So, I’m of the belief that if you’re not growing, you’re dying. So I would tell you that if your business is stuck and it’s not growing right now, trust me, you’re going to hit the decline. You’re only going to pause for so long, but in nine out of ten situations there is a descent getting ready to happen.
Let me take you through the life cycle of what needs to happen when you have this problem.
Recognize That There Is a Problem.
It’s not a temporary one.
“Well, Sean, it’s just been this year that we haven’t grown.” Well great, view it like that. Talk to me again next year this time, and we’re going to have the same conversation because you need to recognize that if you’re not growing, you’re dying and very rarely is it a temporary issue.
So I would tell you that if you have a six-month trend, I’d be highly alarmed. If it was a start-up and it was three months into a trend, I would be extremely alarmed.
You need to recognize that there is a problem, and then you need to be very alert to certain numbers that are critical for your business. When you see numbers, not at the level they need to be, then you’ve got a problem.
I get a dashboard every single day at 4:30 in the afternoon and it tells us how many customers have contacted us that day. I see how much have we have contracted and how much have we received and it is broken out over eight different companies. I can see every company. How many customers are seeking to do business with us, what do we contract, what revenue came in and then at the end of the week I’ll see what each company did. I’ll see what the overall pot of money is. Within two to five minutes, I can identify a problem.
I’m on the lookout for these and any trends. Bad trends to lead to bad things. So again, you need to recognize there is a problem and don’t just think it’s a temporary one.
Access Where the Problem Is
You recognize there’s a problem and now you need to assess where is this problem?
Has the revenue dropped? Well, why has it trapped?
Most people just don’t want to ask the painful questions, or… I love this… “Well, I’m going to wait ’til I meet with my accountant.”
I have never waited to meet with my accountant to discuss a financial issue ever. Now, it does help to have an accountant that works on staff with me. I have two of them, but even before that, you’ve got to learn how to read a balance sheet.
SO, IF revenue is dropped, why is it dropped? Has customer activity declined? Either they’re not visiting your store or they’re not visiting your site, they’re not requesting estimates, and then it’s not leading to sales. Sales are down, so there’s a decline in customer activity.
Have your profit margins decreased? Look and see if your production costs have gone up, has your internal cost gone up, is your labor going up, have your fixed expenses made the nut to crack that much larger so your margins have declined?
I need to ask some questions so I can assess where the problem is.
Five Reasons Businesses Don’t Get Unstuck
I have found there are five reasons why people don’t make the necessary changes to get their business unstuck.
- They don’t accept that change is needed. They believe it’s temporary or a market trend.
- They don’t know what they need to change. The more questions you ask and the more research you do will help you find out where the problem is what needs to change.
- They don’t know how to make the change. You better get a professional in there. Get someone who can help you with the problem if you don’t know how to do it. I once, early in my business career, was facing a lawsuit from a former employee and I had a general lawyer handling the issue. I asked someone who’s opinion I trusted for some advice and he told me, in doctor terms, that I have a general practitioner when what I really need is a surgeon.
- They get cold feet. “Well should I really make this change?” They start second-guessing it.
- They can’t afford to make the change.
All these lead to a company that goes out of business.
Common Reasons Businesses are “Stuck’
Here are what I have found to be the most common items that need to be corrected if you’re struggling. About 80% of the time these are true.
- You lost your competitive advantage. Well, if you’ve lost your competitive advantage, there’s no reason for your customers to buy from you. Why buy from you over your competition? You’ve lost your competitive advantage.
- You stopped advertising. You got on a roll with some word-of-mouth business, and think you don’t need to advertise anymore. Listen, there are very few companies that can get away without advertising and 99% of time, it’s not yours.
- Your staff can’t execute excellence. You don’t have enough talent to provide a competitive advantage. You don’t have enough talent to provide a great customer experience. You don’t have enough talent to have a good profit margin because they’re too slow.
This is the 80% that I just shared. If you have a business and you are stuck, you cannot move forward. It’s eventually going to go backward. I can tell you that right now.