A Trip Down Memory Lane
November 17, 2010
Remember when you first got the idea to start your business? Remember when you were the only one doing all the work? Remember when you hired your first employee? It seems like forever ago, doesn’t it?
Odds are, the business you started has changed a lot. Heck, it used to be easy to get jobs, and the truth was, you really didn’t need that much work to be busy. There was money coming in the door, it was fun to buy new equipment and the banks were more than willing to loan you more money than you needed. Shoot, it was much easier to do a lot of things; you were working hard and you could still see your belt buckle!
When you got a little tight for cash, it was easy to use your credit card to make payroll. Besides, you were getting new credit cards in the mail that encouraged you to roll over your credit card debt, interest free (well, for six months or so).
The building you were renting quickly became too small and you needed more space; you might even have found a building to buy. Why, it would be worth more than you paid for it in no time. So you spent a lot (more than you had) to make a lot.
You needed equipment, and you might as well buy the best available, because you were growing and you wanted stuff that would last. It was easy to find out what to buy; you looked around and saw what the competition was using, then went to the distributor to get some help selecting what would be best for your company.
While you were at the supplier, you heard about some technical training courses you could sign up for. During those sessions, you and your employees began to see ways that you could improve the equipment that they were showing you, because by then you knew your business inside and out. You knew that if you did good quality work that you would be recognized as “the company to use” and become even more successful.
And why not? You were booking more jobs, everyone around you was offering to sell you everything you needed (or wanted, for that matter), and you were anxious to take their help and keep growing. You were told that the bigger your volume, the more money you would make. They had to be right, because you could see the growth of your company growing before your very eyes!
What you were experiencing was the growth that all new businesses, barring a catastrophic collapse, go through at start up. What you really needed to be doing from day one was setting up a system that would keep track of everything going on in your business because, inevitably, that steep early growth curve would soon be settling down, bringing a sharp dose of reality with it.
It’s kind of like the first time you work a really large catastrophe. When it hits, you get really busy, in fact too busy. When it was over you discovered that you did a lot of volume for little or no profit, but boy, it sure felt good to talk about the volume of work that you and your company performed and, no doubt, the next time a catastrophe happened in your area, you would know exactly what to do and what not to do.
When I ask clients who worked in and around New Orleans after Hurricane Katrina hit how their companies did, I receive a pretty standard response: “I will do well, if I get paid for what I did.” You know the rest of the story; a lot of people are still in court trying to get paid for work that has been completed for a long time.
This is what people mean when they talk about the difference between growing a business and growing a profitable business. You must organize and systemize your business so that effort results in maximum reward not every so often, not once in a while, but all the time. So where should you turn for answers and suggestions about how to do it? Here are some options to consider:
- Visit your distributor or supplier and pick their brains.
- Attend trade shows and share information with companies outside your area.
- Buy a franchise and get the answers you need from the franchisor.
- Hire an industry consultant with successful track record (that you can verify).
- Participate in an industry peer group devoid of any direct competitors.
- Continue what you’ve been doing, cross your fingers and hope things will get better.
The truth is, at some point everyone needs help, whether they believe it or not. What I’ve come to realize over the years is that the people who recognize that fact early on, and who are not afraid to ask, are the ones with the careers that the rest of us stand around asking ourselves, “Wow, I wonder how they did that?”
Here’s a suggestion: just ask.