Marketing Your Business
Target marketing
Do you have a strategy to reach your potential customers (dealers, homeowners or business owners) with your sales and marketing efforts or do you rely on someone else? A shotgun approach and/or relying on word of mouth is too expensive and inefficient for any company, especially a small or mid-sized one. What percentage of the people you approach actually buy a product or service like yours? Make sure you know this information as you may need to diversify your services.
Advertising, Public Relations and Attending Local Events
There are many choices for where to place an ad and how to execute a public relations campaign. The challenge with many small businesses is that their marketing activities are driven primarily by which salespeople happen to call on them. Ineffective advertising or public relations can be not only a waste of money, but also a waste of opportunity. If you are doing things the same way you did them 10 years ago, you are probably getting less response. Find out how VSI can work for you.
The Message
Lots of companies still use this line: “We will exceed your expectations.” I even saw it on the back of an ambulance one time (I don’t know about you, but I have pretty high expectations when I call an ambulance!). It was a good line when someone first thought of it. Now, it is old and overdone. You need to exceed people’s expectations by coming up with your own line. This overall message should say something about your company that impacts potential customers, ones that want to purchase your product but more importantly, buy your quality. Do you know who your target customer is? If not, find out how the VSI can help.
Management
Hiring
I can’t think of anything more important than hiring the right people, especially right now. Great hiring is a skill, one that frequently is not the strong suit of the typical entrepreneur. Do you have a hiring process? I have found that hiring the right people is 75 percent of management. What percentage of the people you hire work out great? I feel that it should be 80 percent or 90 percent, and perhaps less in a low-wage environment, but we need to aim high, after all it is your business! Let VSI help you grow your workforce.
Operations
Training, standard operating procedures, forecasting trends, support, recognition, systems, key performance indicators, follow-up, the details, etc. Is your company getting the job done? How do you measure success? Are your customers happy? Do you know? How is your employee turnover? Are your employees happy? Would they tell you if they weren’t? Have good people left your company for more money? Have they left for less money? That is frequently an indication of other problems that exist. VSI can help you get the proper training for you and your team.
Accounting and Finance
Basic Accounting Practices
Many seemingly successful companies have gotten into big trouble by neglecting accounting until it is too late. Accounting is not just about paying taxes and making payroll. It is also about information, insight, and control. Great accounting will not make a business successful, but bad accounting can destroy a business (big or small). Is someone staying on top of the books, on top of the open jobs, the backlog? Be careful about opening new accounts, taking on new projects and making sure the existing ones are current and in good standing. Remember, quality over quantity. Could you walk someone through your financial statements and explain each part? If not, you may want to re-think your current process.
Pricing
Like “sleepers” in Fantasy Football, this is probably the “sleeper” section on this list. I can’t tell you how many times I have seen small businesses either put themselves out of business, or never make the money they should have, because of bad pricing models. They charge prices that bear no relation to the costs or to the value proposition. This is just one of the reasons a company needs accurate accounting — so it can determine the true cost of a product or service. Do you or your salespeople have control of the pricing for jobs that they quote or install? If so, are they selling at a price that allows you to make a profit in the field and pass that savings on to your employees? If you have any questions on what to do to help improve in this area, see how the VSI can help.
Financing
Most businesses need some kind of financing. Whether it comes from investors, banks, credit unions, factoring or even credit cards, there is a lot to know and understand. Here is a test: Do you know your debt-to-equity ratio? This is another place where a good accountant can be of great help. I also encourage you to go online and do some research in this area.
Leadership
Any one of these topics could fill a book, and leadership is no exception. It is similar to management, but they are not the same thing. Let me count the ways: vision, direction, inspiration, support. As I have come up through the ranks over the years, I have found that leadership gets easier if the proper people are put in place to run the business, manage the projects, etc. When a company is smaller, the leaders have to manage and lead. One minute you are writing someone up for violating the late policy, and the next you are trying to inspire the troops or host a meeting with the bank. Perhaps management is pushing, and leadership is pulling? It’s not easy doing both at the same time, which is why I also suggest finding a coach or a mentor, someone you can trust to bounce ideas off of.
Whether your small business scores well or poorly in terms of the winning approaches on this list, keep in mind that it is an ongoing challenge. Personally, I’ve been doing this for over 20 years now, and I can assure you that at times, I too wrestle with almost every item on this list. I challenge you to sit down with your team and quantify the cost of trial and error vs. actually planning out the entire upcoming calendar year. In doing so, how much did it cost you, how many dollars did you leave on the table? Some solutions going forward are to forecast, be prescriptive in your new approach, starting with lead generation and go all of the way to installed and paid. If you want to learn more, please reach out to VSI or a member company today, we are all here to help.
Going Forward
Throughout the process, recognize that working on all the aspects of a successful business takes time, effort, engagement, and most of all, true grit and the power of leading by example. Remind your team to work on the above core principles so that everything else can work itself out. To quote Lee Iacocca, “Lead – Follow – or Get Out of the Way.”
To your success,
Coach Rob Balfanz
