Are you a business owner wearing many hats in your business, one of which may even be sales? If this is the case, you are not alone, as there are many business owners around $2M-$3M in sales, where the owner/operator is still acting in a sales capacity along with running many of the other areas of the business. All of this is while still dealing with day to day issues.
Keeping Your Eye on the Right Ball
Focusing on revenue to grow your business has to be your core goal. To do this will require you to be more focused. You have to develop processes to track your sales leads and forecast appropriately. This is in addition to continuing to fill your pipeline and measuring your own and your team's success. As your business grows, there will need to be enough structure to hire the right people to free you up to work on your business. If you are the only one who performs sales for the business long term, you become the business. If "you are the business" when you want to sell your business and retire, you will find the actual business is not worth what you thought. Without you, there is most likely not a business.
Developing Sales for the Long Term
When we talk to business owners who want to grow their business, they sometimes tell us they can barely handle the sales they have. Yet to grow, they still need to increase sales. Depending on the products and services you sell, you may be able to attract customers without much time spent on marketing or developing new sales. In the majority of cases, this is not a sustainable model. At some point, your sales growth will slow down if you do not have the right marketing in place or know how to develop new sales. If your marketing is not in place when you need to grow, this is tough to start when you are now behind the eight ball. Here are some identified barriers to sales growth:
Lack of back end processes, project management, or systems to be able to handle more sales
Lack of working capital to purchase additional inventory or hire the necessary people or spend on marketing
The existing employees have too much on their plate
The business is not able to obtain financing at the current time due to finances
Strategy, Time , and Focus
When you are one person in a business and are doing everything, you do not have the time to develop a strategy, processes, buy the right systems, or figure out how to hire the right people. You are just keeping your head above water. The problem is that time goes by, and more people join the company; you have to manage more than yourself. It will be sufficient for a little while, and then all of a sudden, things will start falling through the cracks. Without proper management, you will find employees are not doing what you think they should be doing and are not sure why. You do not understand why the employees are not taking the initiative to do things in the business independently.
As an owner, it is your business. You have taken most of the risk, but you also have the most to gain if the company prospers. Employees want and require structure. They want to understand what they are supposed to do and whom they take direction. For the most part, they are there for a paycheque to feed their family, as this is not their business, it is yours. The better you treat employees and recognize them for their contribution to the business, the more they will want to help contribute to the business's success.
Once you do hire employees, you need to let go and delegate the responsibility to others. It would help if you spent your time focused on your business's success and working on growth, not bogged down in the day to day fire fighting. We find many business owners put off hiring salespeople as there is a lack of trust in letting go of that part of the reigns. The key is to hire the right salespeople and manage them properly. We have seen many owners hire the wrong people or have hired the right people but failed to train them on the business and give them proper guidance. Instead, they forgo trusting this function to anyone else and continue to try to run the business and sell as well. The focus needs to be on working on the business and setting aside the time to do so. There is nothing wrong with the owner still being part of sales from time to time as many times they are the face of the business to customers. But, if the business is going to grow, the primary focus needs to change from selling and finding others suited for this function.
The Concentration of Effort - Day to Day
If you want to grow the business, the new focus as the business owner needs to be on:
Understand the revenue, you require monthly to cover your expenses, break-even, and be profitable.
Understand your expenses and knowing whether they are reasonable or need to be reduced.
Understand if the account receivables are being collected on time and the level of bad debt you are carrying.
Understand if you able to pay your bills when they come due.
Understand if you spending enough money on lead generation and marketing to generate the sales you need.
Understand if the money you spent on sales and marketing has generated a return on investment. If they have not, you want to understand why not and not continue paying for those activities.
Understanding if your financials are such that you are able to borrow money for investment if needed.
Understand if you have too much inventory or not enough.
Understand if there are employee issues in your business that are adversely affecting your business
Understand if the productivity of your business is less than 70%.
The Concentration of Effort - Ongoing
In order to grow your business, in addition to the items that you as a business owner need to be on top of, your role needs to be the one to:
Set strategy, goals, objectives, and vision for the organization with time frames of when you would like to achieve them.
Communicate strategy, goals, objectives and vision to your employees so that everyone is on the same page.
Ensure that the objectives set for employees and their performance appraisals have some tie to the objectives of the business.
Put the right steps and measurements in place for the business to help meet and measure the success of your goals and objectives.
Determine if you are meeting your goals and objectives that you set and if not you need to know why not.
As the business owner, there will come a time that you will need to be able to focus your efforts and time on the right things to keep your business running smoothly and be poised for future growth. Suppose you are running around doing 100 different things a day and selling like when you started the business. In that case, you are not focused on the business to ensure you can meet your goals, both from a business and personal perspective. As the business owner, your time needs to be spent working on your business and determining how to grow it and take it to the next level. It is hard to let go of the reins, but you will be taking the step needed to grow your business when you do.