You might not be able to convert your neighboring parking lot into a business, but you may be able to use that space as a profit center. If you own a storefront and your business sells shoes, you may focus all of your energy on the idea of running a shoe store. This process is normal. High-technology providers focus all of their energy on producing revenues from the things they do, high-technology stuff. Clothing manufacturers focus all of their energy on distributing clothing as they work on producing revenues from all of the things they do. Auto mechanics focus on all of the auto repair stuff they do to create their own profit streams. Every business model produces its own activities for generating revenues in order to create potential profit streams.
Most profit streams are easy to see. When a clothing manufacturer thinks about producing more profits, they work on ideas that help them improve the manufacturing process of clothing. The best profit streams, however, are the ones nobody sees. We will call those streams of profit 'invisible streams.' The question becomes, how many 'invisible streams' does your business model produce?
When you wrote your business plan and you opened your business model did you focus only on the thing you wanted to do in your business? If you wrote a plan to make the best cupcakes in the world, did you focus all of your energy and work plans to center around making money on producing cupcakes? Likely, you did. Most people who lead a business have all of their thoughts directed towards making money on the things they produce. Accountants focus on attracting clients to process bookwork they can provide for the streams of revenue they receive. It is a simple idea and works very well. All accountants do it. Every business owner processes their business model to try and make their money stream profit. They try to make profits from what they do.
This is the whole idea of owning a business. If I retail furniture to the consumer, I try to make my money stream of profit by selling furniture. Most business owners operate in this fashion. They place all of their energy into the thing they do to try and create a favorable profit stream to manage. The next step we want to visit is to see what other things business owners can do in their business model to create new streams of revenues, or new profit centers...'invisible streams.'
If you have been operating your business for enough time to see it running well, you might want to begin the search for developing new profit streams to enjoy. There are likely many opportunities resting right under your nose. Sometimes we get so busy doing the things we do to make our business model work well we often times cannot see other opportunities resting right next to the work we are already doing. Sometimes we see other people figure some really cool things out and we wonder how they got so lucky. In most cases, they did not get lucky. They were always looking for the next opportunity and one of them 'hit' well.
When my wife and I first got married we knew each was the 'right one' in this relationship. However, there were thousands of times we discovered we may have 'picked' the wrong one. It is funny how a great relationship develops itself well through the many trying experiences. Sooner or later, we learn the same thing from owning a business. We get good at what we do.
As we work to build our business model we do not initially think about how our parking lot can become a profit center. All we have time for in our life of trying to survive is to think about making more money from the different ways we can buy and sell furniture. That process consumes every inch of our life and time. Who has time to think about making money from a parking lot next door?
A business owner will eventually develop a system of operations that works well in producing some acceptable streams of profit from what they do. They will be able to manage that system in a more efficient manner than when they first began building that business model. Many of the things they do become a part of involuntary thinking. They do much of what needs to be done without ever giving any thought to how they need to do it. Some of the most complicated business decisions are made with an ease of flow.
I remember my first managerial 'job.' I was in Sacramento, California. I had a store manager who had been in management for 35 years. He was very smart. I was always impressed by the things he used to say. Once in awhile I had the pleasure of working side by side with him. I remember thinking about how deep his thinking would travel. When we worked together on planning a future promotion I could not believe all of the deeply connected things he would direct me to consider. Some of the layers of the things we needed to include would freak me out in how he would link them into the process we were doing. He had so much insight that I remember thinking, "I could never do the kind of work he was doing." I kept thinking about how he does what he does. I remember thinking about how he covered so many options that could occur and designing "B" plans to deal with them if they did occur. I was so amazed at how he could think about all of these potentially relative things.
Thirty eight years later I find myself teaching fellow employees how to think in deeper layers for the kinds of things that can take place and how to develop a plan that runs deeper than the surface of the obvious things that can happen. Years of experience form a process of thinking that becomes involuntary to produce success.
A couple of years ago I was sitting at the head of a board room filled with frustrated board members about the future of one of our program developments. The discussion was complicated and also heated. Keeping everyone in the room controlled with cooler heads was as much a challenge as was the issue we were debating. It was magically controlled. At the peak of the discussion it was apparent the board members came to a single question as they looked to me in unison and asked me if I thought this project could survive. I paused for a moment while a sudden thought hit my mind. I knew this project would work, I could feel it. I knew it in my heart and I was convinced completely that it would work.
The thought came to my mind to share with them an experience I once had with my father. I had already finished four years of college at a business school. I had also finished four years of working for a large corporate organization as a mid-level manager. Numbers and coordinated reports were my life up to that point. I was good at reading them and reporting on what they revealed. My father did no such thing. He had never worked on producing reports. He was a self-taught merchant. I told this story to the board of directors at this tense moment.
My father and I were involved in a tough process for making a complicated business decision. My father was confident in his choice. I accused him of lacking the proper numbers, the proper reports and the proper details for making a good decision. We battled about the process. I told him a person cannot make a successful decision of this magnitude without knowing the numbers of fact. My father told me I was full of hogwash. We went with his decision and parted from the brief meeting remaining mad at each other. His idea, the one he said he felt, worked great. After years of business experience, I told the board, I now know the feeling he was trying to describe. I told the board the numbers they have in front of them do not completely support the idea we are trying to do, but the idea, I can tell you will work. I can feel it. I now know what my father was so intensely speaking about. I told them it will work, and it did.
When your business life reaches that point, it is time to begin developing some other profit centers that are resting all around your business world. You can now take some time to develop ideas about how to make your parking lot a profit center. You can work on developing a new revenue stream with the business knowledge you have acquired. You can produce a wholesale business within your model to introduce licensed products or services you have been performing to the customers you serve. There are many ways you can generate new income streams that are directly related to the business model you have built. You can feel them well with the experience you have managed to gain. It might be time for you to discover the 'invisible streams' your business can produce.
Think about producing incomes that are invisible to identify. Produce a business within a business. Learn how to vertically integrate your business model so the fees or economic benefit comes from within the business model.
Think about it. Give it a go. In the meantime, we are still working on the questions and answers for developing that new business plan mentioned in earlier posts. It is ongoing work behind the scene of all the recent blog posting.
Until next time...
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