Does your business have any of the following problems beginning to surface – dwindling profits, complaining customers, encroaching competitors?
Heed the warning signs. Problems such as the ones above are warning signs that you should not ignore. Decreases in sales could be a result of any or all of the following causes – customer retention problems, decreases in product quality or an unmotivated sales force. Turning around a struggling business requires humility and a willingness to make tough choices. Uncovering root causes of your business’s problems and admitting your mistakes won’t be easy but you must face the realities to avoid a sure path to failure.
If your company is starting to struggle, consider these three tips to help you get it back on track:
- Focus on the money-makers – Has your business focused on products and services that customers are no longer willing to buy? It makes sense to redirect your company’s available resources toward your most profitable offerings. Do you have a system for determining your margins on your products or services? Is there an accurate way for you to track your expenses and assign them to costs of goods and services sold? These are the factors which determine your profit margin (revenue – cost of sales) and will help you weed out the most unprofitable items you offer. You may be surprised to find that some of your products are loss leaders that actually cost you money instead of making you money.
- Establish your brand identity – This step starts with identifying what you do best and then telling your target market all about it. Your main goal must be to educate not only your customers, but your vendors and your employees on the reasons why your products and services are better than your competition. Be realistic and follow through on any claims you make about your offerings and core competencies or you will lose credibility in the market place. The best way to re-establish your brand identity is to be specific in your value proposition by plainly stating the benefits your customers receive when they buy from you.
- Track your results – This is a biggie, probably the biggest of the three tips presented in this post. Keeping a close eye on your numbers is paramount to managing your business and maintaining or growing your market share. You must measure what matters. This means tracking both quantitative (numeric) and qualitative (non-financial) data and once gathered, analyzing the results. Examples of some things to track include # of customer complaints, cash flow status, trends of items on back order, and profit trends.
Customizing these three tips to suit your particular business will allow you to think more strategically and help you to identify root causes of problems before it’s too late to take corrective measures. If you’d like help getting your business back on track, give us a call, it’s what we do. Our business coaching is an intensive one-on-one program that can help you identify issues you can work on to reach your goals.