By Krista Chapman
Twitter.com/PinkLadyKrista
No doubt, you started this little business because you
wanted to carve out an meaningful and successful purpose. Months, maybe ever years later, you have seen
a glimmer of a idea grow into a wildly successful enterprise. But you have a dirty little secret... You're busy but you're broke.
Nothing feels worse than staring down a ever-increasing pile
of bills and wondering how much longer you can rob Peter to pay Paul. For too many businesses, businesses founded
on passion, big dreams and bigger investments,
Peter catches on pretty quick and the doors slam shuts just as quickly
as it open. A likely culprit are to
blame for your financial woes. Four
culprits, in fact. And all are why
you're broke.
(1) You buy on impulse. I like to call this SOS... Shiny Object
Syndrome. How often are you caught
ordering office supplies or shopping at Target, when an enticing deal catches
you off guard? Momentarily distracted by
the shiny goodness, you pounce and purchase.
Too many small businesses to name struggle with impulse purchases
because they're not following a budget. And
you are no different. Without a clear
idea of what you can spend based on needs and incoming revenue, businesses (and
employees) fall prey to a staggering number of impulse buys. Purchases that spend any bottom line faster
than you making it.
First things first... you need to create a budget. One that allows you to reinvest in your
business, have fun money and still
retaining profits. Any employee that has
buying power should also be working with a budget. This not only gives money value, working with
a limited amount of resources, people will often take more care to manage those
resources. Shiny Object Syndrome in
remission, creating purchasing rules for your company puts you one step closer
to plentiful profits.
(2) You're not
tracking ALL your expenses. Not almost
all, skipping minor things like a puny $25 water bill, but all expenses, down to the stamps used when
you sent your bride a thank-you letter. I'll
admit guilt, overlooking these minor bills.
Wedding vendors are generous by nature... you have to be to work with
brides. But this generousity can come
back to bite you. Trivial expenses add
up over the course of a year and a wedding vendor may find that their profit
margins have been entirely eaten up by the special meetings, extra trips to
Sam's and poorly priced all-inclusive packages . When you spend more money than you make or
more importantly, do not charge fees high enough to cover all your costs, the
math simply does not add up. You are
broke and will continue to be broke. Successful
business know where every penny is made and spent and have a clear indication
as to their profits. Refer to said budget above.
Insider Trick:
Stagnant inventory reserves are like cash sitting on the shelves. How do you flip inventory, limiting the cycle
of trapped cash? Make sure operations is
talking to sales. Think of these enities as the two halves of your brain. Except, in most businesses, the corpse
collusium has been cut and they just don't communicate like they should. I made a point to check wine and food
inventories weekly as a venue director.
Knowing what was on hand (and needed to be sold), I guided clients
towards these items. As a result, we
only bought things when we absolutely needed it and quickly sold it.
(3) You've stopped
marketing. Leads are drying up, no
one is calling and revenue has taken a steep decline. In a panic, many business yank marketing and
advertising dollars, hunker down and hope for the best. Here's what I know for sure... When
twenty-something brides can't find your company, they book someone else. The same fate awaits companies unsure how marketing
impacts their sales, companies with too much ego or sense of entitlement and
companies unwilling to take on the risk.
They teeter between almost broke and broke, until...
You don't need to continue spending thousands and thousands
to stay in front of brides and grooms but you do need to make a effort to stay
in front of them. Like everything else,
you're marketing plan must be based on a budget (yep, that word again) that
takes sales and revenue flow into consideration. When one marketing tactic is no longer
producing leads, take a moment, weigh the ROI
and make changes. Even the most
successful companies, worldwide brands known the world over, still market. Many spend millions to keep their brands in
front of consumers and search out relevant ways to do so. When you stop investing in your future... not
much of future awaits.
(4) You're making excuses. I could hear your inner but... but.... but so
I save this one until the end. The hard
truth about life and business ownership?
Customers, opportunity and money are simply not going to fall from the
sky because you've opened for business. One
must actively pursue the life they want.
I hate finding myself in conversations with defensive vendors making
excuses that brides are buying differently... we're in a recession... I am just
not reaching the right brides... I can't afford the advertising I need to
grow... blah, blah, blah. Guess what? Excuses don't breed confidence, solve
entitlement issues, increase your time management skills or make for successful
wedding businesses. Just imagine where
civilization would be if progress was consistently stalled by one excuse after
another. Steve Jobs was fired from Apple
in 1985. He didn't make excuses or wallow in perceived failure. Instead over the next decade, he took over
the world, his former company included.
Excuses act as a cherished, yet oppressive burden that keep us from our
best life.
The wonderful truth about America? It allows the weak, the tired, the poor to
pull themselves up by their bootstraps
and open a business... no pre-requisites required. Driven by passion and entruprenial spirit,
everyday folks set out for Emerald City.
But what these daring and passionate souls are not protected from the
cruel reality of how complicated, difficult and daunting opening and keeping
open a small business. But the other
great news? You can make the changes to
overcome diasterous blunders and find our happily ever after.
Fearless steps of
caution, dear readers.
