|
|
 |
MANAGING FOR
MONEY
Feel
the Snowflakes?
Start now: Plan to thrive in 2005.
by Steven C. Bursten
It’s hard
to believe with a hot sun boiling down that it’s time to plan
for next year. Yes, New Year’s Day is a short four months away.
You will do a better planning job and almost certainly achieve your
goals if you start now.
MOVE TO NEXT YEAR
By now you know how 2004 will turn out. You know your sales for the
first half. Your second half sales will likely be the same or a little
better. The fact is, you probably knew by Memorial Day how the year
was going. So, with 2004 now mentally accomplished, and only the physical
reality left to grind out, start planning 2005.
Why now? Why August? Simple: you have time now before the fall rush.
You can take the time you need over the next few weeks. Later, you
won’t have the luxury. Customers and holidays will keep you spinning
plates. If you wait another month, planning will take second fiddle
to customer orders and installations. Now you know why. Next, let’s
talk about how. Here is a simple formula to plan your new year:
1. Clearly define your goal—the vision for your business.
2. Gather the facts.
3. Define your best two or three options.
4. Analyze the pros and cons of each.
5. Make your decision.
6. Never look back.
ONE BY ONE
Now let’s take each step one at a time.
1. Vision of your business. The hardest thing to decide is what you
actually want—for next year and beyond. Write a small, half-page
vision of your business. What do you want for yourself, for your family?
Do you want a large business for fame and fortune? Do you want a balanced
business to allow quality of life? Do you want to put kids through
college? Do you want a retirement business with great part-time income,
but flexibility to travel? Do you want to build business value so
you can sell your business down the line? Only if you have a clear
vision of what you want can you begin to set strategic goals.
2. Gather your facts. “Facts are stubborn things,” advised
John Adams more than 200 years ago. It is still true today. This is
the moment when all the money you spent all year for management information
will pay you back. If you have the facts, you can identify, analyze
and make good decisions. If you don’t, it is all guesses, wishes
and hope.
Do you want to see a grown man cry? I have. And it’s not fun.
I have seen business owners work all year long thinking they were
making a profit. Then in January their accountant told them the sad
news: They worked to pay their suppliers and employees, but there
was nothing left for themselves.
Here are the facts you need:
• Number of appointments.
• Number of customers sold.
• Total sales.
• Gross profit summary for each job sold. (This is the hardest,
but most important.)
• Advertising expense by media.
3. Define your one or two best options. Your options for growth are
probably to increase advertising, move to, or open a new location,
hire a person to help you in the business or simply to maintain and
move steadily forward. Don’t overlook options to increase sales
in a product category to balance your business. If you don’t
have at least 40 percent of sales in either draperies, soft treatments
or in blinds or hard products, you may be missing an opportunity.
If you are not selling at least 10 percent shutters, and you live
south of Chicago, you may be missing an opportunity.
Every year, take one serious, strategic step forward in developing
your business to be the well-rounded profit machine you want it to
be. The wonderful thing is, it is your business and you can select
options that fit your personality and talent. Build on your strengths.
Find others to fill in where you need help. It is a good executive
decision to get others to help. It is poor growth management to do
everything yourself from sewing to installing to bookkeeping.
4. Analyze the pros and cons of each decision. Actually, you may analyze
one major, strategic decision and one or two smaller ones. A strategic
decision may be to recruit a decorator, or to develop a major product
category, or to develop a media advertising plan. You may also consider
tactical goals: to develop a cost control summary for every sale,
to collect e-mail addresses, to develop your Web site.
Take your time—this is a critical step!
Write out your personal rationale to each option. Here is the value
of starting now: you don’t have to make that list the first day.
In fact, this process should take time. I find my best decisions through
the years were when I had a good sense of the problem I wanted to
solve. Then I asked myself, “What facts do I need to solve this
challenge?” Sometimes it took me a month to get the facts together.
Then I would go away to a quiet place and stay two to three days in
a hotel to think. We all need this every two years or so. Then once
a year take at least a day to yourself out of town, all alone.
5. Make your decision. Based on your careful analysis, based on thinking
about each option, based on testing your options by asking, “How
will this option make money next year and position my business for
the future?” and, finally, based on your own stomach feeling
about what is right, it is time to decide. So do it!
This is the tough part.
If you put it off you’re a wimp. You may avoid pain now, but
you are guaranteed more pain later. So, go ahead, make your decision
and write yourself 200 words why. (Next year look at what you said.
It will help you get better and better at annual goal setting.)
6. Never look back. If you know in your heart you have a good vision,
that you gathered facts correctly, that you analyzed carefully and
that you made a decision you believe is right, you cannot do more.
Stop thinking about the options you did not select. Stop worrying
about the options you never thought of. Focus on the decision you
made and move on it without hesitation.
Never look back. Never second-guess why you did it. This is extremely
important. You might make the wrong decision, but you might make it
work anyway because you believe in it and you’ll fight for it.
And, a less than perfect decision this year may lead you to a better
one next year. So, whatever your decision is, be proud of it, fight
for it and if it fails, learn from it. But, never question it or have
doubts. Doubt and fear will undermine any decision. Don’t let
it happen.
BE PROUD—YOU ARE READY
When you finish this process you will join an elite group of less
than five percent of business owners who grow their businesses by
setting goals and good planning. That is the best feeling of all,
to know you did the right thing for your family, for yourself and
for your business.
Then, when the snowflakes are falling and you make the round of New
Year’s parties, listen to all the folks say, “Hope you have
a great New Year!” Inside, you will smile. You’ll know you
aren’t just hoping for great year, you’re causing it. You’ll
feel in control. You’ll feel confident. You’ll know a great
year will happen because you planned it that way. There is no better
feeling in the world.
 This
article is based on Steven C. Bursten’s actual experience with
sales and financial information working with hundreds of window coverings
businesses. Whether you are a sole manager who aspires to higher sales
or you manage 50 window fashion decorators in a multi-million dollar
business, this series will help you manage sales better and increase
your profitability. Bursten is the retired founder of Decorating Den
Interiors and author of a how-to book on new business start up, “Bootstrap
Entrepreneur,” and is a leading expert in window coverings marketing,
sales systems and sales management through his company, custEmers.com.
Questions and comments welcome: steve@custemers.com or (888) 333-8981.
For a report, “Why your customers love shop-at-home, and so should
you,”send a request with your business name and address to sah@custEmers.com |
|
|
|
