Strategy

Strategies to Grow Your Business

Growth can come in many different forms (even in pruning… more on that another day). If you’re planning to grow your business this year you need to get very clear on the HOW. How are you going to grow? That can be the overwhelming part, so let’s simplify it! There are three easy growth areas to consider.

Volume - Increase the number of sales you make Volume is all about the quantity. You want to sell more of the thing you already do. This strategy usually involves acquiring new customers which can be costly because it requires more spending in marketing and getting new customers in the door. Be sure you are creating lasting customers and not one time customers.

Price - Increase the price of your service If you want to increase your prices you need to be sure that your value aligns with the price increase. The value you deliver should out weigh your price. This results in delighted customers! If you’re not comfortable with a direct price increase think about how you could add value, then increase the value and the price. Is there a way to enhance the customer experience (this is golden)?

Services - Increase the number of services you offer Adding new services is a great way to increase sales. Figuring out what to add can be simple, but many businesses don’t do it. What is this simple step? ASK. Simply ask your current customers what else you can help them with. What are their biggest frustrations? Now figure out how to solve their frustrations.

These three strategies can be used alone or together. But remember, Focus is key. Depending on your size, your team, and your goals, you should only focus on one to two things at a time. Focus is what gets work done!

What are you going to do to grow your business this year?

If you’d like to grow your business but you’re not real sure where to start, contact us for a free consultation, and we’ll see how we can help you reach your goals.

Growth Cost Money- Avoid the Unexpected

I was recently talking with a client who is at the end of year 1 of his 3 year growth plan. We were recapping with an After Action Review (a report of what worked and what didn’t), and I was surprised by some of his comments. Although, in the beginning of year one he created a written plan for growing his business, he never thought about the additional costs he would have to support that growth.

Fortunately for him, he had savings socked away so he didn’t have any hiccups in his plan. But without that savings his growth plan could have been a flop.

So what costs can increase when you’re growing your business...

If You're Adding New Services-  Many times a business will grow by adding new services. This requires an investment in education, new processes, and marketing for the new service. Learning will not only cost money but time as well. Be sure you have planned for both!

If You're Hiring-  Many times if you are increasing your business volume you will also need to hire. You’ll need to budget for the increased salary as well as payroll taxes, benefits, paid time-off, and workers comp insurance.

If You're Increasing Sales-  If your growth is coming from increased sales you will probably need to increase your marketing budget. This will involve time and money. Will you outsource this or do it in-house? Are you growing online or in a new region? Aligning your marketing needs with a marketing budget will help you plan accordingly.

If You're Increasing Production-  If you’re developing new products, or producing more products, you'll not only need to invest in more equipment but you'll also need more raw materials on hand. This could also lead to hiring, and increased marketing, which increases your upfront costs.

If You're Adding Locations-  If you are scaling your business by opening new locations you need to be aware of not only the upfront costs to open a location but also the ongoing costs. When adding locations you need to be focused on process development and improvement above all else. Clear and concise processes are the only way you can get your business to run without you there… and isn’t that the ultimate goal?

It's important to not only understand these costs but to also have them at the forefront of your growth plan. Failing to plan for these extra costs can be detrimental to your business if you don’t factor them in.

If you’d like to grow your business but you’re not real sure where to start, contact us for a free consultation, and we’ll see how we can help you reach your goals.

3 Reasons Your Business is Not Growing

This was the year! The year you wanted to grow your business. However, you're just not seeing the results. You started the year out strong with high hopes but quickly got busy in the day to day activities. Being busy turns into exhaustion and before you know it you're burned out. Then the last thing you want to do is think about growing a business you're burned out in. Unfortunately, this is pretty common for business owners. Several (aka: a million) things went wrong in the business growth.

Here's the top 3 reasons I see for a business not growing:

  • No Clear Plan. When growing a business you should have a clear, concise, and communicated plan in place. And not just an annual plan. You need a plan that is broken down into quarters, then into months, and then into days. Yes, I said DAYS! You and your team should know what needs to be done each day to move you one step closer to the target.

  • Competing on Price. Unless you happen to be Wal-Mart, you should NOT be competing on price. Wanna know why? Because Wal-Mart will win on price every time. EVERY TIME. Competing on price is a race to the bottom. If you offer a low price this week, next week the guy down the street will go lower, then the following week you'll go lower, and so on. Before you know it you'll be wondering why you're not making a profit.

  • Shiny Object Syndrome. So you did happen to have a written plan for growing then... SQUIRREL! Letting yourself get distracted by the latest and greatest will stall growth. I know new technology is fun or a new business opportunity sounds terrific, but if you constantly get derailed and can't stick to a plan already in place, you won't be able to grow your business. Strategy is about what you need to say NO to.

So do any of the above reasons sound familiar? If so, don't beat yourself up over it. Recognize the issues, make a plan, and move forward. Make today the day you start growing!

How To UN-Complicate a Strategic Plan

According to the dictionary, strategic planning is "a systematic process of envisioning a desired future, and translating this vision into broadly defined goals or objectives and a sequence of steps to achieve them." So what does that really mean?

In basic terms, it is a written plan that will help you reach your goals. It is a simple way to make sure everyone on your team knows what they are working towards, what needs to happen, when it needs to happen, and who's going to do it. If the plan is followed (with potential tweaks, as needed) at the end of the time period your business will be where you want it.

I call this a Growth Plan (you can read more HERE). For example, if you said you wanted to grow your revenues by 30%, your growth plan would detail the strategies we are going to use to reach the goal of 30%.

When setting up a Growth Plan we:

  • Determine your current position in the market - How you compete in the market, your strengths and weaknesses, study your competition, understand your business model

  • Develop your strategic parts - Where do you want to be in 3-5 years, what about in 10 years, what do you stand for, what's your business purpose, and what strategies do you use to compete

  • Document the Growth Plan - Overall annual goal, quarterly goals, and outcomes that we want. Also, document the actions to be done to reach those goals, details on who will do what and when they will do it.

  • Implementation of the Plan - Communicating the goals and strategies with the entire team, as well as monitoring the progress

Not so complicated, right? It's really not but we humans tend to over-complicate things!

The golden nugget in a Growth Plan is in Phase 4- Implementation. You can make the best, biggest, and shiniest plan but unless you implement it it's worth nothing.

So I'd like to challenge you to write your own growth plan. Work through the above 4 steps and let me know how it goes!

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You Can't Grow With Bad Numbers

I recently met with a prospect that was interested in growing her business (super exciting stuff... my favorite prospects to meet with!). Her energy was contagious and I could tell she had a passion for what she was doing. It made me even more interested in how I could help her achieve her goals. Our conversation started off with her talking about her business- what service she provides, her customer demographics, the values her business holds, and where she wants to be in the next year or so.

Great! She had that info down and rattled off answers to all of my questions.

It was downhill from there.

The conversation continued with "Okay, this is where you want to be. Where are you now?"

Her response was "Well... I'm not real sure what our sales are. Nope, not real sure what my gross profit is. Ugh, no idea how much my monthly payroll runs."

What?!? I followed that up with, "How would we monitor your growth if we don't know your numbers?"

Crickets.

What I went on to explain to her was that it is impossible to do financial coaching or growth planning without accurate numbers. Accounting can be overwhelming and intimidating but numbers are concrete. They provide a map to your growth (positive or negative). They allow us to monitor progress, make adjustments to your strategies, and keep growing.

So at the end of the day you can have the best action plan and strategies, but without the ability to rely on your numbers you won't be able to measure whether you're going to reach your long-term goals or not. You need to be able to tell whether your plans are really working, or if you should change tactics to reach your goals.

If you've been relying on bad numbers, or NO numbers at all you should consider outsourcing your accounting to an expert. Let's setup a time to chat and see how we can help you GROW your business.

Why Time Management is a Hoax

Do you know how many books, webinars, and tools there are in the market to help you with Time Management? I don't know exactly but I'd assume there's hundreds of thousands, and here's why I think you're wasting your money buying them. (Sidenote... this comes from the brilliance of my business coach, Todd Herman)

You can't manage time. It's a finite number. Everyone on this planet will get 24 hours in every single day. Period.

What you can do is prioritize your time. You can manage the right ACTIVITIES at the right time. If you are working 8 hours a day, what is the best use of that time? What is the most valuable use? What activities can you do that will grow your business?

The goal is to only be doing the activities that bring the highest value to your business. Outsource everything else. I want to challenge you this week. As you're going through your work week track everything that you are doing. Beside every activity write a dollar amount of what that brings to your business, or what it could potentially bring. After doing this for a week review your activities. What are you doing that you can assign to someone else? Are you using your time at the highest and best use?

Manage the activities, not the time. That, simply, is what time management is.

Growing with the Right Strategies

"Strategic Planning" sounds like a really fancy, complicated process, where in reality, it's not. When I would say those words to different clients I could see their eyes gloss over. This is why I started using the term "Growth Planning". Growth Planning in itself tells you the plan. The Plan is to GROW. How are you going to accomplish that? The "How" is really what strategic planning is.

Most small businesses fail in this department. They want to grow but they don't develop how they will grow. If your plan revolves around what will get cash in the door, that's not a strategy. That's called survival. You don't want to constantly be in survival mode because that's a short-term strategy. You can't keep that pace long-term. You'll run out of money. Or sanity.

Here's what you do need to know....

There are 3 levels of strategy and you must decide where you want to compete. Not committing to one will hurt you long-term. You can be good at something, but it's better to be great at something. Here's the 3 levels:

  • Product Excellence (think Apple) - These companies focus on design and having the best product on the market.

  • Operational Efficiency (think Southwest or Walmart) - These companies are your cost leaders. Their strategy is to keep costs low, and therefore, their prices low.

  • Customer Intimacy (think Disney or Nordstrom) - These companies focus on the customer experience. Notice: I said "experience", not customer service. Customer Service is a must. It's not a strategy.

The key to strategy is determining where you will compete and sticking to it. And remember, part of a competitive strategy is being unique and different than your competitors. What sets you apart? (If you say customer service you should re-read this article).

If you found this valuable and want additional information on how we could help your business, send us at email at joy@lizottecpa.com

3 Simple Questions to Grow Your Business

Now that 2016 is in full swing it's a great time to make changes in how you operate your business. If you know you want (or need) to make a change but have no idea where to start, I encourage you to sit down and answer these three simple, but smart, questions: What should I STOP doing? The things you should stop doing would be the things that do not produce value for your customers or enhance your business. These are things or tasks that won't help you reach your goals. Or sometimes they are tasks that could be outsourced because you're not great at them.

  • Tip: Ask yourself, "If I wasn't do X, what could I do with that time in order to grow my business?"

What should I START doing? This could be anything from starting to produce a new product, to develop a new service, or maybe starting a process to help you connect with customers. What can you put in place to improve your business, achieve goals, change behaviors, etc?

  • Tip: Many times I find that businesses don't have a system in place to track, monitor, or keep in contact with their customers. This would be a great system to start.

What should we CONTINUE doing? Looking back over the last year what has worked well for you? These are things that will help you reach your goals. Or it could be a service that you're great at, a system that works well for you, or an activity that makes you better than your competitors.

  • Tip: Growing a business is tough and slow. It's important for you to recognize the things your are doing right instead of only focusing on the things that you are doing wrong.

Working through these three simple questions should give you lots of ideas for smart changes to help you grow. Once you know what you want to change, set goals and specific tasks to help you reach your goals.

If you found this valuable and want additional information on how we could help your business, send us at email at joy@lizottecpa.com