Sometimes, a year or two after you start your small business, you suddenly find that you’re not actually doing what you expected, or the business seems to have drifted away from what you thought it should be. If that’s the case then it’s probably time you did a quick re-set of your ‘business compass’ to get you back to the right track. When I’m working with small business owners I usually recommend they take time out of the business at least once a year and, to do it properly, to take a few days off and away from the office to concentrate on it properly. Here are a few questions I usually ask them to ask themselves.
What business am I in?
Seems like an obvious question but not always so. Where is the real value in your business? Where does that derive from? Think about McDonalds – yes, they make lots of money from burgers but how much of the company’s value do you think comes from their prime location properties in all the major cities across the world?
Where do I make my money?
Again, sounds simple but think carefully. Do you know the profit levels on all your products or services? What is the lifetime value of a maintenance contract in relation to the profit on the product you sold initially? Is there any benefit in you expanding up and down the value chain to increase profits?
Is this still a good industry to be in?
The fortunes of industries have always waxed and waned but the cycle is getting progressively shorter as the pace of change increases. How is your industry managing to keep up and re-invent itself to stay on top?
What do my customers think?
I’ve worked with many business owners who are paranoid about asking their customers ‘how are we doing?’ because they worry about the responses they may get. Then they get surprised and confused when customers start to leave them because they’re not getting the service they require. Your customers (along with the members of your own team) probably have all the answers you are looking for when it comes to improving your business. Make a point of asking for their opinion at least every 4 months.
How do I rank against my competitors?
What do your competitors do better than you? What do you do better than them? What do your customers like/dislike about your competitors? All this research is useful for helping you to decide how to develop your own offering.
Finally, the most important thing: once you’ve done all the research and thought about the answers you need to take action. Taking action will put you ahead of 80% of your competitors because they won’t take that final step. Remember – “positive thought without positive action leads to positively nothing” so get out there and make it happen.