3 Mistakes Business Owners Make That Keep Them Working Too Hard For Their Money
You've heard the phrase shooting yourself in the foot
, and probably like me, you've used the phrase a time or two. While we aim to be successful in our businesses, there's any number of things we do to trip ourselves up.
One mistake I see business owners make is not knowing the metrics of their business. No, I don't mean centimeters, liters and the like. I'm talking about those objective measurements that tell us exactly what is going on in our business. Sales, Returns, Accounts Receivable, Website Visits, Page Views, Phone Calls, and Traffic are examples of the metrics you most likely need to know to make intelligent decisions to keep rowing your business toward your goal.
You know what a Yield sign looks like, right? It's a triangle shaped sign, bright yellow, with the word YIELD in black, right? Actually, the Yield sign was changed back in 1971 to a red background! Surprised? It was the first time I was asked that question. I was positive I was right. Would you be willing to entertain the possibility you may not know all the metrics in your business? You may say you know exactly what your sales have been each month this year. Do you know why your bank account isn't reflective of your success in the sales department?
It could be you're focusing on the wrong metrics, which is another mistake I see small business owners make. Focusing on getting clients in the door is the first priority when starting a business, right? So, why then does it seem you're scrambling to cover payroll when pay day comes around?
As a business owner you must keep your eye on multiple balls at once. Yes, getting clients in the door is very important, but so, too, is getting paid by those clients. Oh, but you're a retail business, so customers pay in cash. Your issue is while you have the sales, you run into issues with having money to pay for more inventory. It seems you're always ordering more than you're selling. Do you know why?
Okay, so I admit, I'm not very good at juggling. Actually, I would be quite challenged to toss one or two balls in the air and catch them. It's not one of my strengths. So how do we juggle all the balls in our business? Another mistake business owners make is not having a system in place to automate all this. Most of your clients want to pay you, but do you make it easy for them to pay you. Do your clients have to ask for their invoice? How long does it take you to issue invoices? Do your clients know when payment is expected or are your terms due on receipt (funny, I don't see that date on my calendar!)?
The only way you can consider growth is to be successful at getting clients in the door with the processes in place to get paid, and the procedures to ensure this happens over and over. Only by having systems in place can you then focus on anything other than the basics, like getting ideas on where and how to grow your business.
Did you discover you're shooting yourself in the foot?
by: Cheryl E. Cook
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3 Mistakes Business Owners Make That Keep Them Working Too Hard For Their Money