Dear M & M: Any thoughts on why some businesses succeed and others fail? – Jim
Dear Jim: Sometimes we forget. This isn’t easy. There are many things to consider. There is no silver bullet here. However, with that being said, we all make it harder than it is.
Take a good look at what you are doing. Are you selling a product or service that people want? Is your offer fair? What do I mean by fair? Are other people selling it for less? Does someone else offer more or better service after the sale? Being fair means a lot of things.
In the end, step back and ask yourself: are you the best choice? Have you made it easy to do business with your company?
I have seen a few businesses not even accept credit cards or not even maintain regular store hours.
Don’t forget, customer service is huge. How are your customers being treated? Generally, people won’t remember what you said. However, every time they will remember how you made them feel. Think about this: where do you like to shop?
Another important consideration is marketing. What is your marketing plan? What are you doing to make people aware of your existence? Can people even find your storefront or online location? Are you convenient and open when they want to buy? Even if you are selling online can consumers find you on a simple google search?
Finally, the last thing: are you taking in more money then you are spending? When you run out of money, the doors close.
Once again, this is oversimplifying it. We can open a place to sell the best breakfast in town and charge everyone $10 a plate. If it cost us $8 in ingredients just to make it, we made $2 a plate. How far do you think that $2 will go toward paying for electricity, wages, insurance, accounting, banking, lease on space and everything else?
In the end, I have heard many times business owners need to be crazy focused on their product, service and their customers, while watching every minute money coming in and money going out.
I once asked a business owner, “What were your sales yesterday”? He didn’t know.
I once asked a business owner, “How much do you need to sell every day to cover all expenses?” She didn’t know.
I once asked an owner of a restaurant, “How much does this plate of food you are selling for $10 cost to make?” They did not know.
None of these businesses are open today.
ASK M&M is prepared and submitted by Mark Schmitt, director of the Small Business Development Center at Cochise College; and Mignonne Hollis, executive director at the Arizona Economic Development Foundation. To ask your questions: Call the Small Business Development Center (SBDC) at Cochise College (520) 515-5478 or email firstname.lastname@example.org or contact the Arizona Regional’ Economic Development Foundation at (520) 458-6948 or email email@example.com; www.aredf.org.