How Can You Overcome The Three Primary Issues that Kill Small Businesses?
As my beautiful bride and I walked along Pacific Palisades
Park in Santa Monica on a sun-drenched day, she wondered aloud about our
upcoming wedding anniversary, “How would you feel about renting a hotel or
small cottage for two nights. I’m thinking it needs to be close enough to the
ocean where we can hear the waves. I’m really drawn to every part of coastal
living right now. Don’t you think that would be a great way to go down memory
lane regarding our time together.”
Toni is not a salesperson. The idea of spending even one
moment in the business of selling products or services to others would be
horrific to her. But the pitch above was masterful, and the close was artful.
We all sell all the time. So why do business owners commonly say that they hate
to sell?
I would propose that most don’t hate selling. They are
perfectly happy to talk to someone about their product or service and see if
there’s an opportunity to do business. It isn’t the act of selling that chills
the soul. What many dread is the prospecting such as cold calling, selling to
strangers who might say no, or following up on initial calls. When you call to
ask for the decision the answer might be no or the calls and emails may not
ever be returned. In other words, doing the hard things.
Number one on the list of why business owners fail…Nobody is
selling. What about number two? It’s related. The owner doesn’t want to do the
hard thing, so he or she hires it done. This might be hiring a salesperson, a
sales rep agency, a social media lead generation company or any one of a number
of ways to avoid the hard aspects of selling. Unfortunately, it is the rare
owner who actually becomes expert in managing any of these resources.
You see, it is hard to sales manage others when you don’t
know how to sell. It is hard to know which rep group to hire if you haven’t
studied how rep groups work. It is hard to evaluate a social media agency if
you don’t really get social media. You can spend a huge amount of money in an
attempt to generate traffic, leads, or sales with little to show for the effort.
Small businesses fail for lack of the necessary capital to overcome the reluctance
of the owner to sell and the costs of the learning curve necessary to become
proficient with alternative approaches.
If business owners hate to “sell,” they hate accounting even
more. Most might not really hate accounting if they had ever taken a course or
read a book about business accounting. Regardless of the reasons, most small
businesses fail to set up good accounting systems, fail even harder at managing
input into the systems they do establish, receive reporting from their
accounting systems that is inadequate at best, and have no ability to analyze
and make corrections in response to the reporting, because they don’t know how
to read the reports.
The comparison here would be that your heart surgeon does surgery
with no idea what is happening with your temperature, breathing, blood
pressure, pulse, brain function, etc. The second reason that so many small
businesses fail is due to the bookkeeping being inadequate. Why? Because the
owner doesn’t want to do the hard things.
Hiring, managing, motivating, firing! These are hard things.
The government doesn’t help owners love dealing with employees with its endless
rules, laws, and meddling with the employer/employee relationship. So just
after the owner says he hates selling, and hates accounting, the third verse is:
“I hate HR.”
It goes without saying that this is just one more “hard
thing” where the owner doesn’t want to take the time to develop expertise.
There are countless resources available on how to hire, how to manage, how to
motivate, and how to fire an employee. But the reality is that the small
business who reaches the size that allows it to hire employees is commonly
driven out of business by the bad hiring choices and the ineffectiveness of the
employee (s) once hired.
Successful businesses are commonly those where the skills of
the owner are so great that they overcome the barriers presented by failings in
these three critical areas. For instance, you might have a retailer who is so
good at merchandising and choice of location that the customers come and buy
even if the sales staff is not that great.
You will see the outstanding lawyer or doctor whose
reputation results in referrals and the accounting doesn’t matter, except that
the company could be doing so much better if the collection of past due
invoices was better.
Or you have the manufacturer who creates a product so
compelling that inefficiencies in line and staff positions only reduce profit,
they don’t kill the company.
As a consultant and a mastermind facilitator, I have seen
hundreds of such companies; those that make it in spite of themselves, and
those that fail for these very reasons. What I have seen is that owners who
join a mastermind group quickly learn about the places where they are getting
in their own way, failing to do the hard things, or on the verge of failure
because of issues like the above.
When you surround yourself with peers who have unique
business experience, skills, and education, you are going to have individuals
within that cadre who will see right through your defenses and into the heart
of the matter.
Those peers will care enough to spell it out. As an owner we
rarely hear the truth. In fact, we rarely feel safe enough to speak the truth.
But in a mastermind group we quickly see that the others in the room get it.
They’ve experienced the same fears, roadblocks, regrets, and failings. They’ve
been offered opportunities like the ones currently on your radar. They’ve made
good and bad choices. They can speak with great authority because they’ve lived
it. And they can speak honestly because they have no vested interest in the
outcome.
If you live in Southern California and you’d be interested
in joining a MasterMind group and enjoying the immense benefits of peer-to-peer
learning and accountability, please contact Randy Kirk at 310-910-1848
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