Ten Tips for Successful Business
June 10, 2015 - 0
It is always a good idea in business to pay attention to the important details. Important details are often cluttered up with a thousand other unimportant details. The following ten tips are designed to provide some basic tools for deciding which details are worthy of your attention and which are distractions that neither make nor break your business.
1. Be careful who you take advice from. Opinions are like elbows – everyone has at least two. Would be business advisors have more, especially when it comes to what they think you should do. Customers, suppliers, employees, accountants, lawyers, relatives (of all sorts), ministers, bankers, and consultants are just a few of the people who will offer advice on the best way to operate your business.
Ask yourself whether this person knows anything about what they are talking about. Real estate agents understand property, but rarely about the operations of a restaurant. Ask yourself if the advisor has anything to gain from his advice. For example, be very careful taking inventory advice from a supplier.
Do take advice from people who know what they are talking about, have enough knowledge about your business and your plans and have a reason for giving good advice.
2. Deliver what the customer wants, not what you want. You will be tempted to operate your business in a way that focuses on the product, not the customer. Bookstores are not about reading; they are about making money in retail. Just because you hold literature to a higher standard does not mean you should not give good display space to the pulp fiction genre. Always, always run your business with the customer’s wants and needs in mind, not the way you think they should want it.
3. Separate the product from the business. Too often we categorize our businesses by the product we offer. The product denotes the industry we are in and what we offer the public. The business we are in is getting and keeping customers. Focus on this and you will have a successful business, focus on the product and you will get a large inventory.
4. Stay current. Stay current with the work you must do each day, each week, and each year. Procrastination will wear both you and your business down. Not paying a tax payment on time will not make it go away. Not handling a personnel problem will not make it get better. Deal with the issues in front of you based on their priority of importance and deadline. It easier to keep up than to catch up.
5. Study your business. Pay attention to what has happened before in your business. Review last year’s results so that you can improve this year’s results. Understand the cycle of your business when it comes to buying and selling. Continually ask why your customer is buying from you and not your competitor. Look for new trends in your industry and for advances in technology. Re-consider how you do things in business to see if there are better ways. Be open to new and even radically new ideas.
6. Manage your money. It is critically important that you never confuse cash flow with net income. Cash will flow in and then flow out, but the real game is on the income statement. Temporary excesses of cash may only indicate that you have not paid your bills and not that you need an island vacation. Save the proceeds from your selling season for your purchasing season. Always be aware of potential sources of funds and investigate these before you need them.
7. Manage your people. Successful companies employ successful people. Everyone in your company has the right to be successful in what they do and you want them to have that opportunity. This will mean paying attention to details such as personnel development and job performance. The lowest paid employee is generally the first person the customer contacts. Make sure that every person working for you is motivated and educated to take the best possible care of your customers.
8. Believe in what you are doing. Once you have set a course for your company, stay to that course. A lack of focus will cause countless problems as you flounder around looking for the right thing to do. In order to fully believe in your vision, take time to decide on it. Once your decision is made, stick with it unless presented with overwhelming evidence that you should not. Only you can develop the vision that is common to all successful companies.
9. Build equity in your business. Business decisions can be divided into two main groups – decisions that affect cash flow and decisions that affect equity. To build equity you usually have to sacrifice today’s cash flow. Obviously you cannot do this all of the time as you need cash flow to survive today. You do have to make some decisions that affect today’s performance. Examples of this are adding inventory, repairing equipment, and paying your rent. Projects such as a second location, new equipment, and more employees are equity decisions. These types of projects tend to increase the value of your business and allow it to earn more in the future. While no one but you can decide whether you need to be working on today or tomorrow, do not ignore the option.
10. Have fun, enjoy yourself. Successful people take time to enjoy themselves. While owning a business is not a continuous party, there are times when you have a winning moment – getting the big customer, the best sales week ever, community or industry recognition. Take time to enjoy these things, share them with your people and your family. Spend a few minutes realizing that while the war is not over, you have at least won this battle and savor the taste of victory.
In conclusion, spend your attention wisely. There really are only a few critically important things in running your own business and this list should help you find them.