Masonry Magazine July 2010 Page. 34
BUSINESS BUILDING
By George Hedley
7 Steps To Business Failure
Everything is changing in the business world today. The new reality of too much competition and too little profit has become an ongoing challenge. As you get tossed around on this sea of constant change, the basic business fundamentals remain the same. Here are seven surefire ways to fail in business if you don't make the right moves fast.
1. Stay Busy (No written plan!)
Trying to stay busy or keep your crews working is not a plan for success. Neither is jumping from one strategy to another every time the weather changes. During rollercoaster times, moving forward without a written plan is like building a house without blueprints. What's your plan to stay in business and make a profit during the next three years, if your workload shrinks by 25 percent, 50 percent or more? No plans? You might as well burn your cash to keep warm.
2. Compete on Price (Nothing differentiates us!)
Companies that try to do anything and everything for every available customer spread themselves too thin and can't make any money. They are in the "yes" business: "Yes, we can do that!" Would you go to any doctor for heart surgery? When you claim to be good at everything, you'll never get the good projects unless you are the lowest bidder by a large margin. Customers pay more for expertise or specialists. What is your company known for? Why should customers pay more for your product or service?
3. Hire Cheap (We can't find any good people!)
It is tempting to hire cheap people. But when you hire less-experienced, less-qualified, and low-paid employees, you're kidding yourself. Cheap people make more mistakes and require more supervision. This takes you away from making your business profitable. When you spend all your time checking and helping junior people learn, you're not spending your time where the money is made: with customers, looking for opportunities, inspiring and motivating your crews, and on the bottom line. Better people require little or no supervision and will allow you to do more business and make more money.
4. Do It Yourself (No written systems. It's all in my head!)
It's easier to do everything yourself than to teach employees how to do it for you. This management style requires you to be everywhere to assure everything gets done perfectly. This also holds your company and people back from reaching their maximum potentials. Replace yourself with checklists and systems to improve productivity, so you can focus on your top business priorities.
5. Let Someone Else Manage your Money (Too busy to mind the store!)
Most small business owners don't know their numbers or have financial targets. They work really hard and hope their numbers work out. Or, they let someone else worry about the finances. The purpose of your business is to make a profit. But with your head focused 100 percent on getting work done, you'll never make any money. Get focused on your sales revenue, overhead, job costs, job profits and company profits.