Hello from CF
There is a bit of a sporting lull out there at the moment so much so I think people are getting interested in the Nations league! Nobody really understands it but it certainly is better than a whole series of boring friendlies. France versus the Netherlands was good on Sunday night and a chance to celebrate for the home fans. Even Giroud, the moving statue, scored which is a very rare sight these days. With the hurling and football over attention turned to the Camogie final. What a great sight to see Grace Walsh having an unreal game for Kilkenny, but no surprise being part of the famous Tullaroan dynasty. Well done to the Cork ladies but very cruel on the Cats given that the game was decided by a very questionable free. But this blog is not about slagging off referees! It is the last in the series of 3 about our workshop event in our office this Thursday morning. This blog’s focus is on business growth and strategy.
Your business is at one stage of the business cycle so you could just be starting up, be in business for a year or two and just starting to grow or be many years in business but still want to push onto the next level. The initial year or two will be spent on trying to see if your business idea can be sustainable in the long term, to grow into something more profitable, more scaleable and provide you with sufficient income so that you can enjoy a good standard of living. I think it’s a fair assumption to say that everyone in business today is very busy but that doesn’t mean they are profitable and that their business is growing. Many people are so busy working in their business that they rarely take a step back to consider the type of business they have, the direction it is taking, the amount of hours worked for the profits generated, what clients do they like working for and what clients are a pain. What customers pay you on time and what ones are always slow paying you. Are some customers getting you to do extra work and still paying you the same money?
You have a great product or provide an excellent service and there is a growing demand for it so you have to decide is it always going to be just you or do you need help to grow your business so that you can take on this extra work and expand. Therefore you will need to hire! How do you hire in the current climate? Do you take on an apprentice and take the time to train him/her in the way you do things or do you hire a qualified person who can hit the ground running? Where do you go to hire an employee? Should you put an ad in the paper, go on social media or contact a recruitment agent and are you aware of the costs involved? The most important decision you make is that you get the right person as you will be spending a lot of time together, the person will be dealing with your customers and maybe one day that person could be at a senior level in your business and could fund your retirement. Therefore you need an A+ person. If on a scale of 1 to 10 you rate a potential employee a 6 or a 7 then that’s a maybe so you have a doubt. The person needs to be an 8, 9 or 10. Hire slow and fire fast but do it with the boundaries of correct HR practice
A client has requested you to do a piece of work so how do you manage the completion of that piece of work? Have you agreed the price or fee for the work? Is the price you have quoted based on a budgeted number of hours to complete by all the people involved in carrying out the work or is it an estimate based on past experience and knowledge of the business? Is your own time as the business owner priced into the job? What about materials and outlay to complete the job. Once you have got the price how has the client agreed to that price? Is it by word or is there some paper trail to back up the agreement and has the client signed the agreement. What about payment terms – will you have to wait 30 or 60 days from the date of invoice? Have you sufficient cash flow to cover your costs during this waiting period? Can you bill the cost of materials up-front or request a 50% payment up front? All of these areas of pricing, payment, agreement of work to be carried out etc should be agreed before you commence the job. If there is difficulty getting agreement at the outset it is highly likely that there will be difficulty getting paid when the job is completed. The correct onboarding is key to setting the tone for the business relationship from the beginning and shows the customer that this is how we do things and if you want to work with us then you have to fall into our system.
You have managed the onboarding well and now it is time to deliver the service or provide the product. When will this product or service be delivered and will it be done in the expected timeframe? Who will be in charge of delivering it? Who is the contact for the client within your business? Is that always going to be you or is there someone else in the team that could be the main contact? Is there a delay from the client side that is holding up the job? Ultimately the product you deliver or the service you provide is what will make or break your business. Everything else can be fantastic and you can have all the systems and processes in the world but if what you deliver is of very poor quality then you are in trouble. You can imagine that if you go down to your local mechanic and he tells you that he will fix your car by 12 o clock that day and that he tells you a very funny joke and gives you a cup of coffee while you are discussing the car. You come back at 12 and he tells you to come back at 5 because they are snowed under. You collect the car at 5 and pay and 100 metres down the road the car stops, you won’t be a happy customer! You have got to manage expectations and do a very good job, so don’t over promise and under deliver.
How do I get new customers?
Assuming you are delivering an excellent service or providing a super product it is likely that your customers will tell their friends or business colleagues about you. This is free advertising, and is the best form, as your customers are recommending you to other people. They are giving a warm referral and saying to people you really should think about using these guys because I trust them and they are good. So, if the people have received a warm referral come to you they are nearly ready to buy from you, so you don’t have to spend too much time converting a cold referral into a warm one. How do you get more referrals? The easiest thing to do is to ask your existing customers could they recommend you to other businesses or that they pass on a name to you. If you don’t ask then you don’t receive! How many people in your business are asking for referrals? Is it just you, the business owner, or are all your staff asking and are you writing down who and when you asked? If you get a new customer from an existing customer did you thank that person for recommending you? Also there are many other areas of winning new customers that we will discuss on the day such as marketing, websites and wow customer service levels.
Where do you want to get to with your business? Is it a stock market listing? Do you want to grow it to a sufficient size that it would become very attractive for a bigger player to buy it from you? Do you want to get the right team around you so that they can grow it and you can spend more time with your family and pursue other interests? Have you decided what your business goal is and how long will it take you to achieve that goal? Is it two years, 5 years, 10 years or longer? Can your long term goal be broken down into smaller goals? What are my business goals for 2019? What is my sales target for that year and what is it that you, and your team, need to do to achieve that target? In terms of your annual goals can you break these down in to quarterly goals and what quarterly goals are the most important for the next quarter. We will share a document on this that our mentor uses with us in terms of goal setting and dividing your big hairy audacious goal into smaller more manageable ones.
Active v Passive Income
We will look at the stages of moving from being an employee to becoming self-employed which generates active income [income from work] and moving from there to a business owner and finally to an investor which generates passive income [generates an income but you don’t do the work]. This is very interesting and was an eye opener to us when we first saw it. It is not something that a lot of business owners would not have seen before and it certainly offers plenty food for thought.
We have two places left for our workshop on Thursday morning so if you feel this would benefit you or you know someone that could use our help then please have them contact Deirdre on 051 396703 or e-mail her at Deirdre@comerfordfoley.ie