Of the hundreds of thousands of business ventures started every year, many never become a success. Others may grow but then give up after a good start.
A small specialist food company that has been delivering high-quality condiments to many a foodies home for over six years. They’ve created loyal customers but they sell only £500,000 in products..
Despite its low margins, the company has been able to serve many happy customers. Despite this, the company is not able to cover overheads and provide adequate incomes for founder & family.
I know I went into business myself for more personal time and more money.
With the current economic climate and the low profitability of the company, its capital growth and sustainability in uncertain. It’s unlikely to get any external investment or acquisitions without a huge capital infusion.
Another up and coming company, that’s thriving profitably and growing rapidly, imports novelties from the Far East that they go on to sell on to large chains in the UK and US
The founder, who has a paper net worth of several million dollars, has been nominated for an award for entrepreneur-of-the-year. But the company’s phenomenal growth has forced him to reinvest most of his profits to finance the business’ rapidly growing inventories & receivables.
Moving forward, the company’s profitability is attracting competition and customers are tempted to work directly with its Asian suppliers. They’ve clearly got a keen eye for what works. If they don’t do anything soon, the business will die.
As a business owner I am sure you have been there yourself, you all get plenty of confusing advice…
- Diversifying your product line is important. Stick to what you’re good at.
- You can raise capital by selling equity of your business
- It’s hard to keep your balance when something bad is happening, but do keep in mind that even during those times you’re the one in charge.
- Learn to delegate and hire more VA’s from the Philippines
- Act decisively. Hire a professional manager. Watch your fixed costs.
There’s a lot of conflicting advice out there and it’s difficult to know what to follow.
Seeing as the problems and number of options that business founders have to go through can be quite diverse.
The CEO of a mature company might ask, What business are we in? or How can we exploit our core competencies? Entrepreneurs need to keep asking themselves what they want out of their business and whether they want to develop new skills.
Entrepreneurs often don’t think about the big picture. Whether it be their goals, strategies or capabilities, they’re naturally biased towards getting to work and achieving them without really thinking of the consequences.
They need to soon start questioning their company and their business future and life structure.
The crucial thing for entrepreneurs to do is ask tough questions like:
Where do I want my business to be in the next 2/5/10 years and am I on the right path? If not, it may be time to re-think where they’re going & what they should be doing.
Have you ever wanted to take your business to the next level without having to work every day?