In the movie City Slickers, Jack Palance’s character Curly and Billy Crystal’s character Mitch are riding along having a bonding moment, when Curly turns to Mitch and asks,
Curly: Do you know what the secret to life is?
Mitch: No What?
Curly: This! (As he holds up one finger)
Mitch: Your finger?
Curly: One thing. Just one thing. You stick to that and everything else doesn’t mean (expletive).
Mitch: That’s great, but what’s the one thing?
Curly: That’s what you gotta figure out
I’m always reminded of that scene whenever I ask my clients “What’s the number one thing every business needs in order to succeed?” Inevitably, I get a number of different answers that include reputation, a good product, good customer service, great staff, hard work and so on.
Quite frankly they’re all wonderful valid answers and easily qualify within the top 5 items, but not what I consider the most important item. However, every once in a while, I get the answer I’m looking for, and that answer is money!
Try doing anything without money
Money pays the rent, the staff, the new pc’s, product or service development, etc. It’s what keeps the lights on. Money affords you the opportunity to create great products or services. Money allows you to provide great customer service. Money allows you to provide a great work environment. Don’t believe me? Try doing anything in your business without money.
Generating profitable revenue, getting paid and controlling expenses are the key elements to getting money. Do enough of these you’re your bank account grows. I know this sounds pretty simplistic to many, but unfortunately, countless owners don’t get it. What I typical come across are owners spending their time on non-revenue generating activities. Although they’re busy, these activities are just a waste of time and are usually a substitute for doing the things that they should be doing, but don’t like doing, such as a prospecting, follow up calls or networking.
The thing is, the longer they put off doing the important stuff, the longer they’ll struggle. What they fail to realize is that they only have to do these uncomfortable tasks until such time as they can afford to hire someone else to do them. Therefore, it’s in their best interest to focus as much of their attention on generating as much profitable revenue as possible.
Other reasons for building a healthy bank balance is to avoid stress. Running a small business is full of stress and an opportunity to minimize the any of it, is welcomed. Having a healthy bank balance means not stressing over making payroll or paying your suppliers. Having money in your account means being able to take a regular paycheque.
Weather any storm
One of the biggest benefits to having money in the account, is being able to weather any form of revenue drought. Over the course of the 17 years I owned the Marketing Resource Group, we would inevitably have one month of the year where revenues would go to zero. Not just slow down, but really go to zero!
When it first happened, I remember getting very concerned wondering what the heck was going on. Had our service model run its course? Had our clients found another supplier? Had they found an alternative solution? It’s the kind of thing that could really ruin your day, week or month and keep you up at nights.
The first time it occurred was in January, I justified it by saying our clients are just a slow getting back into the swing of things following the Christmas holidays. The next year, it happened again, but this time in March. Once again, I was stressing over it. However, when revenue recovered the following month, I chalked it up to Spring Break distracting my clients. Year over year in continued to happen, but strangely never the same month. Fortunately, as time went on, it became a non event and I just accepted the fact that we would lose a month of revenue every year.
The upside of this, is that those quiet months would give us almost four weeks in which to get caught up on a ton of housekeeping activities that we couldn’t get done the rest of the year. Eventually, we actually, planned these activities for our down month. All this to say, that this is another luxury of having money in the account. We didn’t panic, or should I say I didn’t panic anymore. We didn’t rush out and change our strategy or desperately take on any old piece of business just to generate some cash. And we didn’t lay off anyone. We just kept doing what we had always done. We maintained our discipline in targeting those clients we wanted to do business with and with full confidence that the business would return to normal. You can’t do that when your account is empty.
I do recognize, that having money tempts us to get little careless and spend it on “nice to have, versus need to have” items. But those temptations are easier and less stressful to deal with, than having no money.
Curly might be right, that as individuals we each must find our own “one thing” but when it comes to owning a business, there is only one thing, and that’s money!
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Copyright © Greg Weatherdon 2018
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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.