If you look, see, hear and think you will learn.
Sounds obvious but how many do it? I am a self confessed infoholic. My addiction is information on topics that interest me; world affairs/politics, business and sport. I am interested in ‘cause and effect’ so the net result is I read a lot.
Not just novels like most people but what interests me. It’s amazing what you see, what it means and what you learn.
Recently I came across two short articles in the same journal on facing pages and they said so much about why people fail in business and yet, do people ever learn?
One article gave statistics on businesses failing from cash flow problems and the other was about a business that went down because it’s single largest customer placed it’s business elswhere.
In summary it goes like this; a survey revealed that in the UK 100,000 businesses fail each year because their owners fail to do any financial planning.
25% of firms never set any financial targets and 35% have never set aside funds for employee development. 20% admitted to beginning to plan when it was too late and 50% blamed this on not having enough time. They were surprised to learn that these causes of failure were greater than adverse trading conditions.
The failed business was a very cost sensitive business that did sub contract machining. It had been established 49 years and employed 12 people.
It was dropped by it’s single biggest customer. The owner has now re started as a ‘sole trader’ doing the same subcontract machining and ‘working all hours’ to survive.
He says he has learned his lesson and will not carry out work for businesses in the sector of the company that dropped him and is now doing work for other businesses.
I admire his tenacity and wish him well for the future but these two tales tell us so much that should be applied as normal business practice.
Never rely on a single customer, never stop marketing, prepare an annual business plan with costed goals and timed targets.
Manage against that plan and review progress making adjustments in accordance with the trading position. At all times control cash flow and only spend when you can afford to. Simple but so effective and as important as any ‘day to day’ task.
My experience is that many business owners have a job working for themselves. They do tasks ‘in the business’ and though this is necessary when starting a business the objective must be to develop the business by working ‘on it’ not ‘in it’.
If our business owner had set a financial plan with a costed marketing plan to acquire one new customer in each of the 49 years history - would it have gone bust? I believe not. I am almost certain that in many of those years he was busy working ‘in’ the business not ‘on’ it.
No matter what type of business you consider continuous, targeted and costed marketing is crucial. No customers, no cash flow, no business.
Tip: Look, Listen, Learn and take strong firm action. Do the thing you think you cannot do,
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Resource Box: Article by Michael Harrison, Author, Publisher and Business Consultant. Learn from an expert: Go to:
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http://www.be-your-own-business-expert.com/Articles.htmlMichael Harrison is an author, publisher and business consultant specialising in helping business owners and individuals to realise and release the full potential of their situation. He has helped many people to improve their business situations and advised and supported individuals to embark on new directions in their careers.
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