"Profit First": A Two Step Process to a Better Business
The truth of the matter is – you do have money in your business that’s waiting to be used properly. You can realize a higher profit in a couple ways.
First – let’s talk efficiency. Are you sure your business is doing things efficiently? I’ll give an example from my own business. The most efficient way to process bookkeeping is to have the banking transactions download into QuickBooks. Some clients were in the habit of just sending us statements and we had to manually key them in. This took more manpower and guess what – I was shy about charging more for the manual work. We now require all clients to enable bank downloads. It not only lessens the time it takes to get the data in, but it’s much more accurate. Now we can spend time analyzing client accounts and helping them become more profitable.
I challenge you to look at your processes and see what you can do to make them more efficient. I’m challenging you to go get yourself a cup of coffee, find a quiet place and really think through the processes your team are doing to get the work done. I just shared one process that we’ve changed… there were over a dozen things we changed last year to bring things to efficient levels. Believe me when I say we have process improvements waiting on the sideline for when the “busy” season ends and we can focus on implementing them.
Second – let’s talk about your clientele. Mike Michalowicz has another book called The Pumpkin Patch. This book is about processes and one of those processes is cloning your best client and letting go of clients that don’t match what you do best. Both Mike and I acknowledge that it’s hard to conceptualize letting a client go when you are struggling to make payroll. It is, however, been proven that the “misfit” clients you have are costing you money rather than making you a profit.
I have gone through the process of letting clients go. I will not say it’s fun. If you are like me, I like to do what I say I am going to do. Letting go of a client makes me feel like I’m going back on my word; however, once I did it… once I let the “misfits” go, my team and I immediately felt better. As a team, we became more efficient just because we no longer must do what doesn’t come naturally for us.
Lastly, I will quote Mike because I thought he said it brilliantly. “You don’t have to slash and burn the moment you put down this book (newsletter). You can take it slow, just get started.”
Several of you have asked me to help you get started on the assessment. I’m happy to do so – reach out to me and let’s get some time on the calendar.
The important thing right now is to just start something… start thinking of how you can run your business differently and most importantly, stop thinking… “but we’ve always done it this way.” This way of thinking will always get you the same result. If you want 2020 to be different, then you have to do something different.