Too often innovation gets confused with invention, when in fact they are not the same. Unfortunately, we are bombarded with articles and warnings that in order to survive as entrepreneurs we must innovate or be left behind. Ok, I’m not sure that we would be left behind, but innovating or improving how we do things, is never a bad idea.

The goal for any innovation should not be for the sake of innovation alone but should either enhance the customer experience or increase our efficiency. If you can do both that’s even better.

Microsoft Office 365

pilot in open cockpit plane

A simple example where, in my opinion, neither of these goals are achieved is Microsoft Office. Over the past few years, I have watched as this software grouping has morphed into a bloated feature laden product.. What was once a simple dropdown menu style that allowed access to the most commonly used functions have disappeared under renamed menus loaded with icons that would have an archeologist scratching their head trying to decipher these hieroglyphics.

Excel Icons
Egyptian-Hieroglyphs

I would hazard a guess that the vast majority of the Office 365 install base are not power users, therefore these improvements or product evolutions, fail my innovation test. It neither improves the user experience nor increases efficiency for most of us as we waste so much time looking for a simple formatting function.

I’m sure that some power users need these enhancements that the product engineers dream up but for most of us it’s overkill.

A recent experience with an Excel spreadsheet or is it now called a workbook or a worksheet? Regardless of what it’s now called, I needed to unlock a protected spreadsheet. Because I don’t use Excel everyday, I needed to hunt down that function. Once upon a time, you could simply click on one of the dropdown menus and click on that function. Well no more.

After I don’t know how long of hunting and pecking through the drop menus and trying to decipher the various icons, I typed “unprotect” in the Excel search bar to no avail. Finally, I turned to Google for help and finally found the answer. Seriously, nothing should be that hard.

A simple solution might be to just offer the everyday user an option for a “Classic” menu that would offer the user the most commonly used functions within the complete Office 365 lineup. Now that would be an innovation!

Alternatives such as Open Office, Libre Office and Google’s Workspace offer a simpler user interface. Aside from being free, their popularity might be driven partly by their ease of use.

Small Business

Innovation for most small businesses does not have to be earth shattering. In SBM #36 Innovation, I mention that what we need to understand is that most successful innovation comes from either borrowing ideas from other industries or reconfiguring your existing products or services to tackle new markets or customers. Put this way, innovation becomes less daunting and can be implemented  incrementally over time and does not require wholesale retraining of your staff and customers. Therefore, they are considered natural or logical enhancements.

Merriam Webster provides the following definitions which may serve to clarify the difference between innovation and invention:

Invention

“a device, contrivance, or process originated after study and experiment,” usually something which has not previously been in existence.

Innovation

for its part, can refer to something new or to a change made to an existing product, idea, or field.                                                                                   

They go on to provide the following example:
One might say that the first telephone was an invention, the first cellular telephone either an invention or an innovation, and the first smartphone an innovation.

The wristwatch

Another simple and great innovation is the wristwatch. Prior to the 20th century, wristwatches were only worn by wealthier women as a fashion accessory, whereas men had pocket watches. It took a World War for the wristwatch to become a mainstay accessory for men.

As the story goes, coordinating troop movements, bombardments and attacks required officers and soldiers to be always aware of the time. The process of fumbling for a pocket watch proved cumbersome due to the necessity of having to always check. That frustration was compounded during the winter months when wearing gloves.

Someone gave this some thought. They simply stole or should I say borrowed the wristwatch idea and adopted it for men. That way soldiers wouldn’t have to reach for their watch at all, as they were wearing it. A simple twist of their arm and they could see the time.

WWI soldier with Watch
https://www.businessinsider.com/watches-after-wwi-the-male-accessory-2016-5

My experience

When I founded the Marketing Resource Group or MRG, I brought this essence of innovation to the consumer packaged goods and healthcare industries. Prior to MRG, I owned The Sales Support Company which was a contract retail merchandising company. In other words an outsourced sales force. I had 150 people working coast-coast performing various sales functions in our client’s smaller retail customers.

Because our merchandisers needed to travel from store to store to perform their duties, wages and travel costs represented a significant portion of our costs. Raising prices was difficult as it would dilute the cost/benefit argument we had put forth. So, after eight years sustainable profits were elusive, so I sold the company.

My innovation

One of the reasons that made my decision to sell The Sales Support Company easy, was that I knew the industry still needed to service these accounts but needed cost efficient solution, which I had been quietly testing for over a year.

Once clear of my obligations with my previous company, I launched MRG to provide our clients with an alternative solution to service these accounts.

So instead of having an individual physically visit a store, we began telemarketing these accounts as a means to communicate and solicit orders. As an aside, we provided other services that previously required a sales representative to perform, but now were done remotely.

I knew of only one company that was doing anything remotely similar and that was Kimberley-Clark, the makers of brands like Huggies and Kleenex.

The big difference was that they were selling their own products, whereas we would be a sales as a service model, representing any number of companies and brands, albeit never at the same time.

Aside from Kimberley-Clark this hadn’t been attempted before and therefore it took a bit of effort to get buy-in from our clients.

Eventually, we convinced enough clients of the merits and gained the necessary momentum to make it a viable business that I owned for 17 years until I sold it.

This innovation had numerous benefits and few downsides for our customers. Considering that we handled what I referred to as their orphaned accounts, those retail establishment that due to annual purchases or geographic location, received no sales coverage from their existing salesforces.

Foremost, our reach was unlimited. If they had a phone, we could contact them, regardless of where they were located, even in the Artic.

Innovation through adaptation

So let’s be honest. I didn’t invent anything here. I simply took an existing service, telemarketing, and applied it to an industry that wasn’t using it. There is a saying “good artist borrow ideas great artist steal ideas.

Is that not the purpose of innovation? How many so called innovations, add no value to the end user and only add confusion.

First and foremost, innovation needs to improve the experience. But change for the sake of change is rarely a good idea. The best way to determine the value of your innovation is to ask your customers and not just your power users.

Also consider that instead of more features, maybe consider fewer and see if that improves the user experience.

You may also enjoy SBM #107 Beware of the whale

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

The world economies are in a mess and heading for a recession. But this shouldn’t be much of a surprise if you’ve been paying any attention to the news over the past year.

The war in Ukraine, inflation, ongoing supply chain disruptions, interest rate increases, energy supplies and pricing are making it tough for consumers and small businesses alike.

So what is a small business owner to do? Well, you have two choices, play defense, and batten down the hatches or go on the offense and grab market share. So let’s explore both options.

Play defense

The most natural thing to do in recessionary times is to get ready to ride out the storm. In episode #55 of the Small Business Minute titled Are you Ready? I review some things you can do to ready yourself for an economic downturn.

But when a recession does hit, playing defense means making draconian cuts in expenses because there’s a good chance your revenues will take a hit.

It means being ruthless. You need to adopt the attitude that nothing is sacred, and everything is on the block. But being internal optimists, that’s not easy for a lot of entrepreneurs. Always remember the goal during recessionary times is to survive and live to fight another day.

One big problem with any pending economic retraction is knowing how bad things may get. There have been many contractions that weren’t anywhere near the predictions and ended up being nothing more than speeds bumps.

Ocean storm with lighthouse in background

However, there have also been many times that the reality was far worse than the forecasts. In addition, some industries were more impacted than others. The point is no one knows with any certainty which way the winds are going to blow. So, it’s better to prepare for the worst and hope for the best.

This recession is different

Unfortunately, there is one major problem facing business owners this time around – Covid! Let’s be honest, from a business owners’ perspective, Covid was not just a health issue, it was business destroyer. Its impact was far worse than any recession.

Small businesses faced unprecedented disruption, through forced shutdowns, and health and safety protocols that were extensive and expensive. This left small businesses uncertain of their future.

Because of this, entrepreneurs were forced to make decisions to cut staff and expenses in order to survive. Any owner that had a financial cushion saw most of that safety net disappear.

So, once the economies of the world started to open up, entrepreneurs have been struggling to return to profitability and normalcy. Unfortunately, because of Covid, most small businesses have nothing left to cut.

Sadly, if a recession is in the cards, thousands of small businesses will disappear as they are tapped out. One thing that you can count on is that there won`t be a government bailout.

But there is an alternative.

Play Offense

Soccer/Football player on the offense

If you take a pause and step back for a moment, you’ll might realize that there is another approach to consider, and that is to go on the offense.

When you consider that when most small business owners hear the word recession, their knee jerk reaction is pull back on everything. As I mentioned early, it’s a legitimate strategy. Batten down the hatches and survive.

However, instead of a wholesale slash and burn across all areas of their company, taking a surgical approach might prove to be the way forward.

First off, making cuts is prudent. But instead of sweeping cuts, why not look at all non-profitable areas of your company. Got dead inventory that you’ve been hanging onto, dump it and free up your cash. Even at $.25 on the dollar, it’s better than staring at it and it puts some cash in the bank.

Next, focus only on those products and services that are profitable, period! This is not the time to launch any new initiatives. They usually require some form of investment, whether that’s human or financial to support it until such time they contribute in a meaningful way to the bottom line.

By focusing on those products or services that are already profitable frees up financial and human resources to go on the offense and start grabbing market share.

When you consider that just about everyone of your competitors will be cutting their marketing spend, this will create a vacuum in the marketplace. With them cutting back on their promotional campaigns, this forces the advertising industry to offer discounts or bonuses to make up for their shortfalls. So, this is the time to take advantage of the situation and amp up your awareness.

By increasing your marketing and sales initiatives during this period, it can drive awareness of your products and services within your target market. The key here is “your target market”.

“Going on the offense in a recession,

is like driving down a two lane highway

and getting the chance to pass

10 slower cars in one shot.”

It’s absolutely necessary to have laser like focus on your target because you’ll need to be shrewd on how you spend your money. Because your profitability will probably take hit during a recession, this may not be the best time to open new markets, but every case is different and need to be measured on its own merits. However, going deeper into those channels that you already know and understand is the smart play.

It’s also important to be aware that recessions aren’t biased. They impact most industries the same. So, you’ll need to be prepared to sharpen your pencil as you hunt for new customers, because everyone will be looking for value.

Once the economy recovers, you should be able to recover most of the margin you gave up, because you’ll have fewer competitors.

Going on the offense in a recession, is like driving down a two lane highway and getting the chance to pass 10 slower cars in one shot.

Bear in mind, this strategy take guts, but as the saying goes “To the brave goes the spoils!” But when you think about it, how risky is it? It might be less than you think. When you consider your that many of your competitors will be sitting in a corner sucking their thumbs hoping that things get better.

Fortunately, recessions don’t come around that often but when they do, you must react decisively regardless of whether you choose to play offense or defense.

A word of caution if you’re planning to play defense, be ready to protect current customers or market share. Chances are one of your competitor may be playing offense and you are on their hit list.

Basketball players at the net

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

The following is an edited transcript

{Greg}
Today I would like to welcome back Dennis Geelen the author of the Zero In Formula. Dennis was a previous guest on SBM #92 titled – The 2 Biggest Mistakes. If you haven’t listened to it, I encourage you to check it out.

The reason for having Dennis join us today, is that he’s launching his new book – The Accidental Solopreneur.
So, welcome back to the Small Business Minute.

{Dennis}
Hey, Greg. Thanks so much for having me back on the podcast. So happy to be here.

{Greg}
So, I thought a good place to is by getting Dennis to share his background as we really didn’t touch on any this the last time he was on.

So my first question is, what prompted you to leave the corporate world and start your journey as a solopreneur consultant?

{Dennis}
So, your question, what prompted me to leave the corporate world and start my journey as a solopreneur consultant?

Well, short answer is I was laid off, at the age of 43, for the first time ever. I was laid off from a corporate job and I decided, hey, why not bet on myself and start my own solopreneur practice?

The longer answer would be I had great encouragement and support from my wife. I had a nice severance package, so I knew that I could give it some time.

I decided to give it a full year. Really try and give it my all and start my own consulting business. And at the end of the year, if things were working great, awesome, I would have no regrets. I would have learned, and I’d be on to something. Just the feeling of betting on myself and making it, would be awesome.

If it didn’t work again, no regrets. I would know that I tried, gave it my all and I would never have that – “What if?” feeling. And I would still be young enough to jump back into the corporate world and probably be a better person because of it.

So that’s really what prompted me. If I hadn’t had been laid off, I never probably would have taken the step. So, I guess it was a blessing in disguise.

Dennis Geelen

{Greg}
We all know there are many ways to become an entrepreneur and to co-opt some words from Shakespeare- “Some are born entrepreneurs, some become entrepreneurs, and some have entrepreneurship thrust upon them”

Being laid-off has always been a common theme for people transitioning to entrepreneurship. This is especially true if one has a decent severance package. As I like to say, it let’s you take your idea for test ride, and judging by the success your enjoying, it certainly seems to have paid off for you.

So, can you share what were some of the biggest mistakes you made early in your journey?

{Dennis}
Yeah, lots, lots of mistakes made early on. Where do I start?
So, when I first started zero in my consulting business, I was very naive.

I just thought, hey, I’ve got 20 plus years of corporate experience. I’ll just announce to the world that I’m a business consultant and I’ll give myself a catchy name, Zero IN.
I’ll create a logo, I’ll create a website, and then I’ll just sit back and watch the clients roll in. Of course, that’s not what happened at all.

I did those things, but the clients didn’t roll in. What I found was I really had to niche down. I really had to be the expert at something. Just calling myself a business consultant really didn’t appeal to anybody. That’s a generalist.

I had to get really specific. What specific business challenges am I helping you solve and for who?
What business is in what industry. So, I really had to go through the process of learning how to be the expert and then building credibility as a consultant.

In in my corporate life people didn’t know me as a consultant. They knew me as a director of professional services or a director of Project Management.

You know, I was not a consultant, so I had to brand myself. I had to build credibility and I had to become the expert. Then I had to learn how to package my services, and sell my services. So, all kinds of mistakes in the beginning. Just assuming that announcing to the world you are a consultant, and you know people will be lining up at your door. I had a lot to learn and luckily had enough runway to be able to make those mistakes and learn from those mistakes.

 “who makes more money the heart surgeon or the family physician?”

{Greg}
Focusing (SBM #53) or becoming expert in a given area is one of the hardest lessons for entrepreneurs to learn. That applies equally to companies and not just consultants. It’s a lesson I learned many years ago and it paid off handsomely.

When I sit with struggling entrepreneurs, most can’t identify their target market or ideal customer. That’s because they’ve never really looked at what they do differently or can do better than anyone else.

To drive home the point on focusing, I usually ask the question “who makes more money the heart surgeon or the family physician?” I think we all know the answer.

But to become the expert, it requires discipline and commitment. Discipline, as you point out in the Accidental Solopreneur, to know when to say no to an opportunity if it doesn’t fit. And commitment, to learn everything there is on the subject matter. It’s tough to do, but so worth it!

So let me ask, were you impacted by the pandemic, and if so, how did you pivot? 

 “I helped companies solve indifference.”

{Dennis}
Yeah, the pandemic. Boy, that really messed up a lot of businesses. So, for me, I was finally rolling, I had figured out my niche.

I helped medium sized businesses with their customer experience and creating a culture of innovation. Or as I like to say it, I helped companies solve indifference. Indifferent customers or indifferent employees. And here’s how you do it.

I had got my package down, my services down. I was doing all kinds of engagements. I was doing all kinds of speaking.
I was doing all kinds of workshops and then boom, the pandemic hits.

So, what I did was OK, now I had runway again. I had just made a bunch of money in the early part of 2020, in late 2019, from having figured things, so I had some time
I was given by the pandemic.

I had some money that I was given by my success. I decided to sit down and write the book the Zero in formula. It’s where I took everything that I was doing with my clients. I put it into a book released in September of 2020, and that’s right when things were starting to open back up again.

And boom, that got me all kinds of exposure and more, you know, companies understanding what I do and who I do it for and how I do it. And because I was on so many podcasts and, you know, there was articles about the book and the book hit bestseller. That really was a blessing in disguise. For me, the pandemic is what allowed me to do that.

{Greg}
So many business owners felt the wrath of Covid. They just weren’t prepared. As much as Covid was a health issue, it was also an economic one as the lockdowns came into play.

Long before Covid, I had always told my clients that you need to have a rainy day fund to survive any form of business slow down or interruption. I was usually thinking along the lines of short term illness or a fire, etc.

Like most people, I never in my wildest dreams would have contemplated a pandemic. However, those that heeded my advice, made it through. It wasn’t pleasant, but they made it.

By having cash reserved, it allows you to continue doing the things that need to be done or as in your case, gave you the opportunity to write Zero In.

I noticed that you now also help other solopreneurs start their own practice, what prompted that new initiative for you?

{Dennis}
Yeah, so a funny thing happened. After a few years in at zero in, things were rolling. I now have a book. I now had online courses.

I was doing all kinds of workshops and consulting engagements and I was just starting to write another business book. I thought, ok, I should have a follow up to the zero in formula. Similar niche, similar type of stuff I’m talking about, but a different spin on things just to keep things fresh.

What I noticed was a lot of people were reaching out to me at this point now saying, hey, I want to do what you did.
Hey, can I pick your brain for a little bit? Hey, I’m starting my own consulting practice. Can you give me a few pointers? Can you give me a few tips?

This was happening through e-mail, through DM’s, the zoom calls, people were wanting to spend time with me and pick my brain. I thought maybe there’s another niche here for me as well while I’ve got zero in going and I can help these medium sized businesses.

I could also start working with other solopreneurs to help them get started, so I pivoted and wrote a very different book.

Instead of the business book I was planning to write, I decided to write a book for solopreneurs and this one, The Accidental Solopreneur, which it ended up being called, is told in a fictional parable format.

I always love those types of books where it’s told in the form of a story with interesting characters. But tips and strategies come out through the book, so that’s what I did there. I started up a whole other side business as well, where now I’m also coaching solopreneurs where they can book calls with me.

I’ve created an online course called the Solopreneur Playbook where I take people through the six steps that I went through, to eventually build a successful solopreneur consulting business.

That’s really been a great new initiative for me, and it was really just prompted by all those people reaching out to ask and I thought there’s a market there. I’ve got expertise, I can help these people.

picture of playbook course
The Solopreneur Playbook: 6 Steps to FREEDOM

{Greg}
That certainly sounds like an interesting opportunity. Going into business is never an easy decision and most underestimate what is required.

By the time they do realize that they’re unprepared, they’ve used up their whole runway and have to throw in the towel. Fortunately, for those that get a reality check early in the process, they’ll now have a new resource available in The Accidental Solopreneur and the accompanying playbook.

So that a great segue to my final question. The Solopreneur Playbook that you have developed is based on your new book The Accidental Solopreneur. Can you give a high level overview of the playbook?

{Dennis}
So, like I said, the book came out of that and an online course as well. Really what I show in the book and in the course itself is a 6 step playbook. I call it the Solopreneur Playbook and it’s basically this.

Step 1 Be the expert. Like I said off the top, that was the first mistake I made, I didn’t niche down enough, but it’s easy to say that. How do you do that? What does that look like? So, in the book you get to see how the guy does it in the story.

In the course, there’s all kinds of resources to help you niche down and be the expert.

Step 2 is to build credibility. It’s great that you’ve niched down now, but you’re still probably one of several options in that niche. Why you? How do you build credibility so that people want to choose you instead of your competitors?

So, in the book, again, it shows how the guy does that in the course, all kinds of resources and examples on how to build your credibility.

Step #3 How do you refine? Which is extremely important is how do you refine and offer your services? How do you package them so that you’re not just selling your time for money so you’re not just saying, hey, it’s 100 bucks an hour to work with me?

What’s your proprietary process? How do you package what you do into a certain number of steps or a certain process and then sell it at a fixed price so people feel like they’re buying a proven methodology or a proven product?
I’ve been telling people in the course sell it like it’s a product, package it that way and price It that way.
So how do you do that?

Step #4 How do you sell it? Learning to sell and getting good at sales is so critical because if you don’t have any customers, you don’t have a business.

So, learn to sell is step #4. Now, I tell people in the course, those first four steps are probably going to be iterative.
You’re not going to get it perfect right off the bat. You’re probably have to go through several iterations before you get that, and then you might stop there.

You might have an offering that’s so good and is priced so well that you’re making all kinds of money and you’re helping all kinds of people or businesses and you’re good with that. But if you want to go further, that’s where steps five and six come in.

Step #5 is build an audience. Now, can you have a podcast? Can you have a newsletter? Can, you know, generate a large following on LinkedIn or Twitter so that you can really cash in on Step 6.

Step #6 is to build assets that generate recurring revenue instead of just offering your time and your services.
Can you write books? Can you do online courses?
Can you have people sponsor your podcast or your newsletter?

Can you create Cheat Sheets that people pay for? You know, what can you do now that you’ve built an audience? Build something once and sell it 1000 times.

So that’s the playbook. That’s the six steps. But it’s very important that you do them intentionally and in order, and you do them properly and that’s really what I go through in the book and the course.

“No Sales, No Business!”

{Greg}
Thanks Dennis for that overview. Those 6 steps make a lot of sense and that’s coming from someone who has been there. Step 4 Learn to Sell is the one that stood out for me the most.

Too often entrepreneurs are technically competent, but they lack the ability to properly present their expertise. I have a saying that I use frequently and that is “No sales, no business!” You can have the best mouse trap but if you don’t have any sales skills you’ll never get any customers.

That’s pretty much all the time we have, and I want to thank you for your time today as well as I want to wish great success with the book and the playbook. I’m sure it will help those many solopreneurs who want to grow their practices.

Also, I lied. I have more question for you. How can people contact you?

{Dennis}
Thanks again for having me on, Greg. So great to be here.
Yeah, if people want to get in touch with me, you can reach out through LinkedIn.

Always happy to connect with people there.
Or you can visit my website, www.dennisgeelen.me .
There you can see all about the book. You can see all about the courses or book coaching calls with me. Love to connect with people and help them through their journey.

{Greg}
Dennis has graciously offered a 25% discount for his online course to my listeners. So just head over to my site at gregweatherdon.com and you’ll find a link for the course, the discount code and his new book in the transcript of this interview.

Here is the link to the course – https://dgeelen.gumroad.com/l/solopreneur_playbook Use this promo code for 25% off – tvzvajc

Here’s the link to his book The Accidental Solopreneur

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

“There was once a Countryman who possessed the most wonderful Goose you can imagine, for every day when he visited the nest, the Goose had laid a beautiful, glittering, golden egg.

The Countryman took the eggs to market and soon began to get rich. But it was not long before he grew impatient with the Goose because she gave him only a single golden egg a day. He was not getting rich fast enough.

Then one day, after he had finished counting his money, the idea came to him that he could get all the golden eggs at once by killing the Goose and cutting it open. But when the deed was done, not a single golden egg did he find, and his precious Goose was dead.”

A white goose

Every time I hear this story, I’m reminded of a conversation I had with a relative of mine a number of years ago. In passing, I happened to mention that after 25 years, I was thinking of selling my business and taking my chips off the table.

To my surprise, he immediately responded that it was a terrible idea and that I should just hire a manager, sit back, and collect an ongoing dividend. “So don’t kill the Goose that laid the golden egg” he said.

“Theory is great,

until it is put into

practice”

Now this is a fine idea in theory, however as we all know, many theories are only good until they’re put into practice, then they just fall apart.

What really set me back with his theory was that he had never c0me close to risking his future on anything remotely entrepreneurial. He had a secure position, plus a bullet proof pension. That is far different than the life of an entrepreneur.

We do it all!

As owners, we deal with far different issues than being a corporate manager. We don’t have the luxury of having an HR department to handle hiring and discipline issues. Nor do most of us have a CFO to manage cashflow, payables and receivables. No, we tend to do it all.

In addition, we carry the burden of our family and employees futures on your shoulders. Let’s not forget the hours spent worrying how we are going generate revenue during a particularly lean period or wondering where the next threat to your business lies.

a golden egg

Let’s face it, if we are honest with ourselves this is what we signed up for and for the most part these challenges are what drive us forward, but the list of things that preoccupy us is endless. And unlike an employee, we don’t leave these worries at the office. They are always lingering just below the surface, 24-7.

This theory of hiring a manager to run your business is a great idea if your plan is to expand your business holdings in other areas. This is because you are still engaged. However, if you have reached a point or age in your life where you’ve achieved your goals or are no longer motivated, then this is just a bad idea.

For many of us, we have built our companies up over several years and any success we’ve enjoyed is a result of keeping an eye on the critical metrics of our enterprise. Turning everything over to a stranger in the hopes they will be as diligent as you have been, is a bit of a stretch.

Of course, if you’ve built a large enterprise and have the luxury of professional managers in place, then stepping away may work. But this is not the reality of most small businesses.

No, its never as easy as just walking away and have someone send you a check every month. There’s just too much at risk.

When you consider that most small business owners have upwards of 80% of their wealth tied up in their business, you’ll certainly need to stay engaged in some manner, lest you wake up some day only to find your business wrecked on the side of the entrepreneurial highway. This is not like a guaranteed annuity that sends you a check every month until you die, without ever lifting a finger.

Further, do you want to risk having to reengage in your business after an extended absence from the industry if the manager doesn’t work out? If you’re like most of us, the answer is probably no!

What the uninitiated don’t realize is that most owners decide to sell because they feel it’s time to move on and take their chips off the table and leave the worries behind.
Hiring a manager and hoping they do well just gives you one more thing to worry about. Isn’t that what we are trying to leave behind?

The moral of the story

Every fairy tale has a moral and so does this one. It’s simply, watch where you get advice! It’s always easy to be an armchair quarterback and offer an opinion when you’ve spent your life on the sidelines.

Let’s remember that it’s just a fairy tale, there never was a goose that laid the golden eggs.

 

You may also enjoy SBM #42  Successful People Do the Hard Stuff

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

So what’s a whale? In this case it’s not a big fish. The whale I’m referring to here is a very large customer. It’s the client that spends more with you than anyone else. Overnight it can take your business to the next level. But if you are not careful, it can also put you out of business.

Pursuing large clients is what most of us strive to do. It’s even better if the company is well known. It gives us instant credibility with prospects and within our industry.

New challenges

But let’s not kid ourselves. Landing a whale is a lot of hard work. As they say, getting the order is the easy part. Ramping up your business to manage their demands can strain the whole organization. HR, finances, and the needs of existing clients can all be impacted.

A whale tail

Even once the large client is up and running, you have a brand new challenge. That is to deemphasize its importance to your business. It’s not uncommon that a newly acquired customer can account for 30% or more of your business. But having any client that represents more than 15% of your business is a flashing red light.

The 15% rule

Somewhere along my entrepreneurial journey, I had read that “no client should represent more than 15% of your business!” I have no idea where I had read this, but once I understood why, I embraced it.

Why the 15% rule? The 15% rule is designed for your protection. As a client moves above 15% of your revenues, their importance to your business grows exponentially. This is because, large, and very large clients end up representing a disproportionate amount of your revenue, your expenses, and your focus. This shouldn’t come as a surprise and is to be expected. But as the saying goes, “don’t put all your eggs in one basket”, because if you do, you better keep an eye on that basket.

When you consider that for most of us, onboarding a large client requires some form of investment. Depending on your industry, it could range from hiring a few people to committing to more physical space, vehicles and equipment that could run into the thousands of dollars. As a result, the financial pressure and risk rise significantly.

The math

So let’s look at this in a pragmatic way. A healthy net profit for many small businesses is 7%, but most barely exceed 4%. So, in a million dollar business that only represents $40,000. Not a lot of money to cover increased costs.

And if we are being honest, most of us sharpen our pencils when it comes to pitching a potential whale. Granted, if priced right, this strategy should put more dollars in our pockets, but it reduces our margins.

This then results in their percentage of expenses exceeding the percentage of revenue. For example, they may equal 20% of your revenue, but because of the discount you provided, they now account for 30% of your expenses. This is normal and so long as they are a client, things should work.

But what happens if you lose that client? Losing the revenue is one thing, but now having to cover all those expenses can become a monumental challenge. Your 4% net profit won’t come close covering an extra 30% in expenses and now your once profitable business can be facing bankruptcy.

However, before it gets that far, you would try to counter the loss by cutting expenses. But reducing staff usually comes a cost of severance pay and those fixed costs, like rent, are almost impossible to dispose of quickly without paying huge penalties. This of course is with money that you may not have.

Growing our business is what keeps things exciting and if done properly can be quite profitable. But keeping your business safe is equally important. That is why the 15% rule is so critical.

So if growing your business is your goal, then you must make growing your existing clients or finding new ones a priority to deemphasize the whale’s dominance. Granted this adds more pressure to your already busy life, but it’s too easy to relax at this point. Once you’ve brought the new whale’s revenue back in line, you can take a break.

By limiting your largest clients to 15% of revenue, it also reduces your dependence on them. Should they leave, and they most likely will at some point, you will probably only face some short term pain. But with a little hustle, you can survive and get back to building your company.

For those that are interested, I’ve created a “Be prepared checklist” that is available for download by clicking here.

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

The reality of being a small business owner is that you are going to have difficult clients. How you deal with them comes down to how much you are willing to endure.

These are the clients that hire you because of your expertise, but then try to tell you how to run the project. They can also be the type that doesn’t respect your time or are late in getting you the information you need but still expect you to meet the original deadline. Of course, let’s not forget those that expect you do more than originally agreed upon, and don’t think they should be charged more. I could go on, but you get the point.

(more…)

One question I get all the time is, “How can I increase my sales?”

The answer to this is question is quite simple. The hard part is executing on the answer.

Selling is more than just showing up so, here are five ways to increase your sales that apply to any business.

#1 Improve your knowledge and become an expert

sales charts and graphs

Knowing everything you can about your product, your industry and your competition can give you a massive competitive advantage that will set you apart Why? Because so few people really immerse themselves in all aspects of their industry to become an expert.

To be sure, lots of your competitors act like they are experts by using all the current buzzwords, but few are, and their depth of knowledge is shallow. Two of the key benefits of being an expert is that it’s disarming to clients, especially to those that think they know more than you. Secondly, it gives clients the confidence that they are dealing with someone who knows their stuff.

Becoming a subject matter expert requires you to do a deep dive into understanding of your product, your target customer, and certainly your competition. Of course, this all requires a continuous investment of time and effort to keep abreast of changes and trends and It’s never ending. But that’s the price one must pay to become an expert.

(more…)

Inflation is much like rust. Left unchecked it can quietly eat away at your buying power and can turn a profitable business into one that struggles and a struggling business into non-existence.

For many of us, you pretty much had to be a Boomer living in an industrialized world to fully appreciate the impact that inflation had during the 80’s. During that period mortgage rates skyrocketed to over 21% and unemployment exceeded 12% in North America.

As bad as that was, there were countries that faced 100% annual inflation back then. To put things in perspective, that meant that the price of goods doubled in a year.

Inflation is like rust

The point of all this is not to provide an economics lesson, because I’d be the wrong person for that. No, this is intended is reinforce the need to be vigilant in managing your costs and pricing.

Regardless of your industry, you are probably facing cost increases in materials and wages. The latter because of the tight labour market, thanks in part to government social programs.

With all the things we must oversee as business owners, being a little more vigilant with all our purchases can become burdensome. However, with inflation starting to ramp up to serious levels, it’s more important than ever review your costs and adjust your pricing to protect your margins.

Too often I find small business owners struggle with increasing their prices because they are afraid of losing customers. Their internal dialogue usually centers around “I can’t charge them that much, that’s expensive, they’ll never pay that much!”

How is it that they won’t pay that much? Everybody is paying higher prices for just about everything they buy now. So, why should you be a martyr? Unfortunately, inflation is a perpetual motion machine that never stops.

The destructive power of inflation

What so many entrepreneurs fail to realize in a high inflation era, is that you need to keep your prices in step with the increases in your costs, otherwise it ends up costing you money and potentially your business.

Inflation can destroy your income statement in short order. When you look at the bottom line of many small businesses, there is not a lot left over after a year of hard work. The typical small business has a Net Income is way below 10% with many running in the 2-4% range. So, on a $1 million business that means your left with $20-40,000 or $10-20,000 on $500,000 and only $6-12,000 on a $300,000 business. Not much of reward for all the hard work.

Now layer on inflation at 4-7% that has recently been reported by various governments over the past few months and you will start to see the potential for margin destruction. But only if you don’t adjust your costs accordingly.

Business is not a charity

Using the previous examples, a 4% increase in inflation can wipe out the profit of most small businesses. Whereas a 7% increase you automatically go negative into a loss.

Look, nobody likes price increases, but it is a reality of our time. For the past 10+ years most of us have enjoyed a low predictable inflation rate below 2%. Even then I have encouraged small business owners to take annual price increases. Because 2% compounded annually equates to over 6.1% over a 3 year period.

Business is not a charity. You are here to make money. The more you make, the more security you can bring to your firm and your employees. The more money you make, the more you can pay your staff and yourself.

Some options

Being worried if your customers can afford the new price is noble but not realistic. There’s no point of losing money just to avoid increasing your prices. Yes, you can always offer a one time discount to your better customers as a way to ease them into the new pricing. But I stress one-time.

I also know that there always seems to be someone willing to do the job cheaper and to that I say let them. Every industry has someone who offers low pricing but it’s my experience that most don’t last long.

Alternatively, you can do what many consumer goods companies are doing, reduce the size of the product to maintain a price. Offering your customers a “lite” version of your existing product or services may be all you need to do.

Minor tweaks such as a decrease in reporting, a reduced delivery frequency or even quicker payment terms are just some of the examples. These small adjustments can be used to maintain a given price point.

Another thing to always keep in mind is if those customers are only shopping on price, you must ask yourself whether you want them as customers in the first place. Often, they are not loyal and will change suppliers for a nickel.

It has been my experience that profit margins are never high enough. So, increasing your prices to ensure inflation doesn’t destroy your company, is just smart business.

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Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

For Thanksgiving we decided to get the whole family together and rent an Airbnb. Since our family has grown significantly over the last few years with marriages and the explosion of grandchildren, we now require a much larger accommodation. 

For the most part, many of the larger places also come with a higher price tag. In keeping with the higher price, such locations typically boast of a higher level of amenities. This is all good and is what it is.

As one would expect, with a higher price tag, there is an expectation that everything should be in working order and that cleanliness should be a priority, especially during this Covid era.

Person lying in bed-complacency

Unfortunately, what we encountered is a case of what I refer to as a “Lazy owner”. This is something I regularly caution all business owners against. No one sets out to be a lazy owner, but it happens to most of us at one time or another. Another term that can be easily substituted for Lazy owner is – complacency.

Complacency doesn’t just happen overnight, at least not for most people. No, it creeps in over time, where little by little we let our standards drop.

Short term vs long term complacency

Short term complacency is easy to understand and why it happens. When you consider that as entrepreneurs, we are always on and even for the best run companies, there are times when we have more issues to deal with than available resources. So, in our haste, we might let our standards drop a little.

However, once the storm has passed, conscientious owners usually up their game and re-establish their standards. Not ideal, but it happens.

Then there is the issue of long term complacency that has the potential to damage your business reputation. This kind of complacency truly reflects the lazy owner and is rooted in arrogance.

I say arrogance because the owners believe that they have a great product or service. It might be because it is popular and in demand now, so they feel they no longer have to try as hard anymore and dismiss any feedback as whining.

It’s been my experience that these owners used to sweat every detail about their business. They did so in order to establish themselves so, hard work is not foreign to them. In addition, their current success, reinforces that they have good instincts. Unfortunately, these good instincts can also lead owner to reject and negative feedback, because they think they are in tune. This combination can easily lull an owner into complacency.

Unfortunately, they fail to realize that they must put forth some effort in order to uphold those original standards. Sadly, many let success go to their heads and over time they lose sight of the finer points of their business and good enough becomes the norm.

Our experience

The Airbnb we selected had very high ratings and came with a price tag of $800/night. Not cheap but considering the size of our gang and the promised level of amenities, it was acceptable.

In general, the property met our expectations, however on closer observation, signs of complacency were everywhere. The following is the list of deficiencies we encountered during our 4 night stay:

1. Numerous burnt out light bulbs.
2. Very weak or no Wi-fi in many parts of the house. The listing stated working wi-fi however, the router was situated in a bedroom in the far corner of the original stone farmhouse which is not conducive for signal travel. Therefore, most of us had to use our cell phone data plans.
3. Satellite TV not functioning.
4. Water dispenser/ice machine on the fridge was non-functioning.
5. Remnants of leftover dry foodstuff from previous guests including empty containers.
6. An instruction manual that included updated data that was placed behind older instructions. The binder was full of with updated handwritten notes that conflicted with printed sheets and chalkboard information i.e., Wi-fi password, security codes, etc.
7. Numerous hairs found in and around master bedroom and bathroom.
8. A severely stained mattress and no mattress cover in one of the rooms. Unfortunately, it was not discovered until we were checking out
9. Unresponsive owner to text messages.

Except for the cleanliness issues, such as the hair and mattress cover, none of the items were a deal breaker, but it goes to show a level of inattention that is not acceptable.

So, what should have been done?

1. This owner should be doing is a quick walk around inspection between guests after the cleaning crew had left. Doing a walk around with a checklist would ensure the property was up to standards and that the cleaning crew was maintaining the property. I call this trust but verify.

2. Check the instruction manual. How hard would it be to check that the instruction book was up to date, without conflicting information? Writing in new information and scratching out the old is not acceptable.

3. If the appliances don’t work as expected, communicate that to the next guests or replace the unit.

4. Look up and around to ensure the lights are functioning.

5. Test the wi-fi and satellite tv and take corrective actions without the client having to discover sub-par performance. In other words, be proactive instead of reactive.

Unfortunately, this property appears to be consistently booked and therefore has effectively lulled the owner into a false sense complacency.

The review

After checkout, Airbnb requests a review of the stay. So, in a very diplomatic way, we mentioned the deficiencies. Unfortunately, the owner responded in what I like to call the “Not my fault syndrome”, suggesting that we were somehow at fault for some of the shortcomings and that we should have notified her, etc. etc. Which, by the way, we had attempted, but got no response.

So, instead of humbly apologizing, this owner goes on the attack. If you dig deep enough into the reviews of this property, you will discover that this a recurring pattern by this owner when faced with critical or negative reviews. Frankly, it’s not a great way to build relationships.

So, what’s the lesson?

I get it. We are all guilty of letting things slip occasionally, but it’s what you do about it that counts. When was the last time you took a fresh look at your office, retail space or warehouse? Is it looking a little tattered or cluttered with stuff? Are there a few more scuff marks on the wall or chipped paint than the last time you noticed?

What about your vehicles, are they clean and safe for your staff to drive? How do your employees look? Are they presentable or have their standards dropped? How do they talk to customers? Are they a little abrupt? How’s their language? Is it professional or a little too casual?

Even after you have asked all these questions, there is still a much bigger question to ask, and that is, how is your attitude? Because as an owner, you set the tone. Have you become little complacent and as result so have your employees?

Yes, these are all little things, but they go a long way to projecting your professionalism and show your customers that you are not a lazy owner.

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Comments, thoughts or ideas for future topics? Let me know in the comment section below

Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.

An often published piece of advice to aspiring and to lesser extent existing entrepreneurs is to follow your passion. By doing so, riches or success will surely be yours. But, as with most of these sound bites, this is rarely the case.

Let’s be honest. There’s lots of things that people have a passion for that could never support their dream lifestyle. Unless of course their dream is to just grind out a meager living.

There are plenty of examples of bankrupt restauranteurs who have a passion for cooking but couldn’t run a restaurant. What about the numerous clothing stores that couldn’t make it even though the owner’s passion was fashion?

Be passionate

Plenty of people have a passion for gardening, knitting, pottery, or music, but few would ever be able to or even consider creating anything more than a side hustle that adds a few dollars in their pockets. Of course, there are always the exceptions to this, but they are by far in the minority.

Be Passionate

So, just because you have a passion for something doesn’t mean you can make a business out of it. But then what would happen to all those “Follow your passion” sound bites and their perpetrators?

So instead of “Follow your passion”, what we should be promoting is “Be passionate about what you do!” To some this may be just semantics, but it’s far more than that. It’s about believing that what you do provides a better solution for your customers and not just wishful thinking.

Another way to look at it is that being passionate more closely resembles enthusiasm whereas having a passion is more emotional.

Merriam-Webster defines enthusiasm as having a strong feeling of active interest in something that you like or enjoy. The operative words being “active interest”. Emotions on the other hand, is defined as a strong feeling such as love, anger, joy, hate or fear.

Being passionate is also about continually trying to improve what you do. It’s about immersing yourself in the industry and grasping its nuances. It’s about becoming a student of your industry and the needs of its customers. In other words, to strive to be an expert.

What are you good at?

Another reason being passionate wins out over passion, is because being passionate usually means your good at something. You’ve found a niche that allows you to excel and therefore you just naturally gravitate towards the area where learning and subject matter information is easily consumed.

At the end of the day, most of us would never achieve any level of success if we just followed our passion. And having talked with hundreds of successful entrepreneurs it was interesting that most didn’t follow their passion.

As a matter of fact, I don’t recall anyone of them telling me they followed their passion. No, most just saw an opportunity that aligned with their skill set and went for it. But they were passionate about what they were doing. Being “passionate” about what you do, is far better advice than “follow your passion” in my opinion.

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Get More LIFE Out of Your Business

You shouldn’t be the hardest working person in your company.

Many small business owners find that even after the struggling start-up years, they’re working too many hours and still managing every aspect of their businesses.

Greg Weatherdon has been there, done that. As an entrepreneur, he learned not only how to get a business to the point of running smoothly, but also how to reduce the number of hours he worked, delegate more responsibility to his employees, and take longer vacations while his business chugged along like a well-oiled machine. And now he is providing the secret to success.

Do you suffer from any of the following?

1. Business ownership isn’t living up to the dream.
2. Endless workdays.
3. You can’t find good people.
4. Profits are less than expected.
5. You can never take a vacation.

You’re not alone. But there is a solution. As Greg demonstrates, with some time and effort, you really can Get More Life Out Of Your Business.