Monthly Archives: April 2011

Re-View, Re-Do & Re-New

12 Steps To Re-Vive Your Business (Part 1 of 4) 
Re-Bound | Re-Start | Re-Balance 

It’s the start of a new season for your team. Over the last several years your team has won more games than it has lost but it still hasn’t won a league championship. Always close but never the premier team that every other team aspires to become. Your team owners are a little frustrated with your performance and want a winner. Second or third place won’t cut it much longer. Your stockholders want a better return on their investment and are threatening to replace you if major changes aren’t implemented and things don’t get better fast.

As you reflect on your company’s past successes, challenges, and failures, how was your performance? Would you have won a championship with your business strategies, managers, players, training program, systems, and plays? Now it’s the start of a new season and you want to become the best team in your league. Should you call the same plays with the same players? Should you keep the same management team and use the same strategy? Should you play the same game with the same equipment?

Think of the premiere teams in sports history. They include the Boston Celtics from 1959 thru 1966, the Green Bay Packers from 1960 to 1968, or the New York Yankees almost every year since 1922. What sets them apart? In almost every great winning professional or college sports organization is a tough, focused, decisive owner or coach. These winning leaders are not afraid to make tough decisions, change their strategies, move players around, replace poor performers, try some new plays, and surround themselves with the best management team in the business.

What do winners do at the start of every season? They RE-VIEW their past performances and analyize what changes are needed to become better over the next season. They rate their strengths and weaknesses, weigh their current situation, and look at their competition. Then they decide what changes they need to make. Now it is your turn to be a championship winning coach and build the best company in your marketplace. What do you need to RE-DO?

1. Re-Bound!
First and foremost, complaining about your competition, customers, employees, or the economy won’t win any games. It only makes things worse and demoralizes those around you. Do you think winning coaches talk about all the reasons they can’t win enough games? No, they get focused on the positive things they can do to build a winner. I am so tired of listening to poor business performers talk about how bad it is. No wonder they can’t build profitable companies, get customers to hire them, encourage their people to perform at a higher level, or grow their business. They are the problem. They focus on the negative instead of the positive. In order to build a winner and achieve bigger results than your past performances, look for opportunities to improve your company, change how you do business, leverage your time, motivate your team, call new plays, find new players, and RE-BOUND at a higher level.

2. Re-Start!
Forget about how you’ve done business in the past. It wasn’t good enough then and won’t give you the results you want in the future. In order to become the best and most profitable company in your market, start with a clean sheet of drafting paper. What would a winning team look like? How would it be organized? What would be your role? What type of customers would it serve? What type of projects would it specialize in? Would it sell low price and be at the mercy of its’ customers to decide if it gets new work, or would it create a service that customers seek, want, demand, and pay top dollar for? Business owners get stuck in their own rut doing business the same way with the same customers expecting things to change. Be a winning coach. Don’t be afraid to RE-START by changing your line-up, plays, strategy, and how you run the team.

 3. Re-Balance!
Do you remember the reason you went into business? To build a profitable company that works without you doing all the work, is organized and in control, and run by your management team. The end result of your risk taking should be freedom and wealth. Not hard work and little money. Never forget the main reason for owning a company is freedom and time to enjoy the benefits of business ownership. Put yourself first, not your customer or employees. You can’t serve customers well unless you are refreshed, healthy, and full of energy.

Dedicate time to RE-BALANCE your life and daily activities. Find time to do what you enjoy doing outside of work. Block out Friday afternoons for your hobby, or Tuesday mornings for time with your family, or Wednesdays for community or charity volunteer work. If all you do is work, what’s the point of owning a company? Don’t miss out on the benefits of hard work and taking business risk.

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Charge Higher Prices!

The long term solution to achieving your ultimate goal to earn more and work less is to charge a higher price for your services and products. When you charge higher prices, you will also make higher gross profit margins. This will create more money to spend on an excellent empowered management team and full charge trained employees. It will allow you extra cash to invest on improving your operations, finances, accounting, marketing, sales, and customer service. In order to charge more, you must strive to become the leader in your market. Back to FedEx as an example. They are the market leader and get more for the same service as their competitors.

Your customers must be willing to pay your company more for products or services than your competitors. Therefore you must offer something different than your competition like more value for the same price, a unique different delivery method, or additional value-added services. Take a moment and describe 5 things you can offer customers which will allow your company to charge a higher price than your competitors:

1. ____________________________
2. ____________________________
3. ____________________________
4. ____________________________
5. ____________________________

As an example, a commercial general building contractor can continue to bid projects to developers per plans and specifications and get awarded the contract if they are the lowest responsible bidder. Or they can negotiate the project at higher prices than their competitors if they offer additional valued or unique services. What can this general contractor offer or provide to encourage potential customers to award them contracts at a higher price?

  • Total development management from concept through completion
  • Design-build architecture & engineering
  • Guarantee no plan omissions, conflicts or mistakes
  • Assist in securing project financing
  • Find equity investors for the developer
  • Prepare overall project budget & investment pro-forma
  • Obtain all City approvals and permits required
  • Obtain all utility company approvals
  • Complete interior design services for tenants
  • Guarantee no change orders
  • No mark-up on change orders
  • Guarantee faster move-in & occupancy date
  • Guarantee no punch-list or defects
  • Full time superintendent with college engineering degree
  • Project manager certified in construction management from the Construction Management Association
  • Project accountant certified from the Construction Financial Management Association
  • Monthly service for one year on all building components
  • Site and landscape maintenance for one year

I know what you’re thinking. ‘We don’t get paid for all of those extra services so how can we offer them?’ Continue to do business the same way, offer exactly the same as your competitors, and continue to struggle to make any real net profit margin. Is the Ritz Carlton cutting back on services or doing whatever it takes to give the customer more than they expect?

What can you do to charge more?

To offer additional value-added or different services than your competitors takes more intensive customer or project involvement, strong company management, and a better trained staff. But it will set your company apart from your competitors. What do you have to do to be different?

  • What five things are most important to our clients?
  • How are we doing on each?
  • What is the evidence of our performance?
  • Do any competitors do it better than us?
  • What can we learn from them?
  • How can we do things better?
  • How can we set our company apart?

Are willing to do what it takes to offer more in-depth value-added services which will get your customers to pay more for you’re your company than your competitors?

Develop loyal customers who will pay more!

Another way to differentiate your company is to have incredible loyal customers who deeply trust you and your company. And because of this trust, they know you’ll do a better job than any other competitor in the marketplace. Quality customer relationships will cause customers to be loyal and only want to do business with your company. This type of relationship takes time to cultivate and a commitment to spend lots of time with valuable customers. Providing good work will not set your company apart from your competitors as they also try to do a good job. Developing and building trust takes a concentrated systemized effort and program. It requires a written plan and includes dedicating regular time to take customers to lunch, attending sporting events, fishing or golfing, weekend trips, and sending thank-you notes and gifts on a regular basis. To carve out the time to build loyal customer relationships requires you to free up 33% of your time. To do this you’ll have to improve your company, management team, systems, operations, and service. Are you willing to do what it takes to build customer relationships in order to increase your profit margin and get what you want?

When your company works and delivers what you want, you feel great. Your company is running on all cylinders. Building your business and making money is easy. Customers want what you offer. Your company doesn’t rely on your constant input and direction to deliver a big net profit margin and sales. Your bank account is growing. Your investments are spitting out lots of monthly cash-flow. Your managers and employees are happy and humming. You walk faster and lighter on your feet. You are excited about going to work because you aren’t bothered with the little details that bog you down. You have pride in what you do and want to accomplish more. Your family is also happy as they get to spend more quality time with you. And your are living a significant life with extra time to enjoy and money to give back to others. Stop making excuses and settling for less than you can accomplish. Take this challenge to move beyond mediocrity. Do what you must do to earn more, work less, and live the life you want.

Measure and Aim For What You Want!

Measure what you want!
Without numbers to track, it’s like playing baseball in thick fog. You continue to play ball and try your best. But in the fog, you can’t see past first base, where the hits go, or read the scoreboard. This lack of information makes the game rather challenging, perplexing, and dull because nobody knows how they’re doing or who is winning or losing. Without knowing the score, what’s the point?

Measure what’s important to you. Paying your bills, invoicing customers, and keeping your checkbook balanced isn’t enough to get ahead or be the best at what you do. In everyday life, you measure your weight, blood pressure, miles per gallon, the Dow Jones average, who won the football game last Sunday, or the dollar amount on your paycheck. What measurement indicators will tell you if your business is on track, serving your customers, achieving your goals, building wealth, or enjoying your life? Here are some numbers to track and indicators which will tell you if you are building an excellent company:

– Annual taxable business income & profit
– Company Net worth & equity
– Personal net worth annual growth
– Annual income from investments
– Annual company profit margin growth
– Sales from new, loyal & repeat customers
– Profit from new, loyal & repeat customers
– Customer complaints & referrals
– Employee turn-over & training
– Personal time off & vacation days

Aim at what you want!
Start with what you want to accomplish. The number one stress business owners experience is from not knowing where they’re headed. What do you want and where are you headed? Next, how will you achieve your goals? If you depend on hard work to deliver what you want, you’re going to be disappointed every time. Then set up a measuring system to keep track of your progress towards your targets.

For example, if you want to increase your net profit margin, there are many things you can do. You can lower your overall cost of doing business, increase your sales, or charge a higher price for the services you offer. At first glance, most business owners focus on cutting costs. This is futile and won’t work over the long haul. With lower expenses as your solution, you won’t be able to hire better people, add more services for your customers, do the little things that make customers want to give you more work, or help you reach you ultimate goal of more time off or freedom.

The second choice is usually to increase your sales volume by proposing on and winning more business opportunities. Winning more work should increase your total gross profit, but will keep you working at an even faster pace to accomplish the additional projects you have to manage. This is like running on a treadmill faster and faster going nowhere. This won’t move you towards your goal of earning more, working less and living the life you want. But it will keep you busier – is busy what you want?

Expand your business expectations. Learn how to measure your success.
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