Monthly Archives: June 2013

Small Business Planning Steps for Growing Your Business

One of the more common questions I am asked when I begin a small business planning session with a client is how Small Business Planningto substantially grow their business.  I share with them a story about my friend Ron.

Ron, a business broker told me how he recently noticed that of all the business owners he meets with about the possibility of selling their business, that almost 80% have absolutely no value. “You can’t sell them for nickel,” he said.  Ron said that when the main asset of a business is the owner, most buyers say, “Why would I purchase a business, where most of the value goes when the seller leaves.  Instead why don’t I just open a competing business next door?”

Having worked with over 1,200 businesses in the past 15 years on their small business planning,  I have found that there are basically two ways in which a business can operate, a fruit-stand model or a factory model.

In the fruit-stand model the owner shows up Monday, sets out the fruit and has revenue. Tuesday they come in, set out the fruit and have revenue. They do the same thing on Wednesday. However, on Thursday, they don’t show up. Consequently, there is no revenue. Friday they come in, set out the fruit and have revenue. In this example, the business is totally dependent on the owner for many things. If they don’t do those things, compel others to do certain tasks or scold others for doing something the wrong way and do the task himself, the business does not operate properly.

Conversely, in the factory model—metaphorically speaking—the owner shows up Monday and builds the factory, but has no revenue. Tuesday they come in, hire their personnel, train them and put the equipment in place, but still have no revenue. On Wednesday, they come in, start the factory, oversee operations and have revenue. Thursday, they come in, oversee operations and have revenue. However, on Friday and Monday, they don’t show up, but they still have revenue.

Small Business PlanningUnder the factory model, a business owner initially invests the time to develop, implement, and optimize the products and systems that are necessary for the business to operate without them present. As a small business planning firm we have found that the key to accomplishing the above is to fully understand the goals of your customer and then develop the systems and products to meet these goals. This is key to transforming a business from a fruit stand to a factory!

Small Business Planning Steps For Growth

Here are four small business planning actions you can take to create a system of growth within your business:

  1. Write down the top three goals that your customer is trying to achieve with your product? That is, what are your customer’s desired outcomes as a result of buying your product?
  2. Look at your products and honestly ask yourself, how do your products enable them to achieve or reach their goals?
  3. Ask yourself, what can I do to enhance my product’s ability to enable them to achieve or reach their goals?
  4. Consider how can you develop new products that will enable your business to more fully to meet their goals?

By using these small business planning techniques to access your business you will start down the path of taking your business to the next level!