Why Is My Business Still Struggling?

It Goes Beyond A Rock And A Hard Spot

Holy cow.  I think by now my revenues should be 'out-running' my cost of business and my income should be getting larger each month.  Why is that not happening?  Is this economy really causing me all of this grief in lost profits?  What the heck is the matter?  I should be doing better by now.  Right?  How many business owners are facing these kinds of questions?  I work with a lot of them that are asking these exact questions right now.

If the truth were to be examined, how many business owners feel this way right now?  How many business owners are quietly asking themselves if they need to make some serious changes in the way they are operating?  How many business owners right now are questioning their business model?  How many business owners are working their hearts out only to get a little bit deeper in debt, right now?  I know and work with a lot of them that are quietly asking these kinds of questions of themselves.  These feelings are dominating their working environments.  They are growing tired of chasing down all of the 'out-of-control' business stuff that should be in better shape and making them more money.  I sit in business offices and listen to the distraught conversations about how tough it has become to function well and how difficult it has become to profit comfortably.  It is not a rare pattern.  It is not a quiet subject.

For the most part, small business owners are growing more disillusioned with every passing day about how much work they put in for the return they hope to see.  Some are fighting within, trying hard to eliminate the wrong and unproductive work patterns they seem to be performing.  They are trying to eliminate how they are traveling down some paths that need large improvements.  For the most part, I meet business leader after business leader who has no problem expressing how discouraged they have become with the idea that their incomes are shrinking while their risk, leadership demands and work loads are increasing.  Most are not happy about this ever-increasing challenge.  They are not liking this pattern.  I see and hear about this frustration every single day in my business travels.  It breaks my heart.

First of all, one; it is true.  Secondly, it is repairable.  Get serious about identifying it so we can begin the repairs.  Profitability is not only possible right now, it is very doable.  Your incomes can and should be improving.  If they are not, something needs changing.

Yesterday I was sitting at the front desk of one of my clients.  The office was empty and I was speeding along to repair some posting errors in their bookkeeping system.  I had discovered a pattern of posting that was going to eventually create a major headache for their business results.  I was scrolling around the computer screen looking for all of the connectivity they had developed that would add too much challenge to their future profitability.  The posting of some of their expenses and sales revenues was atrocious.  There were patterned errors in posting that would mislead them to believe they were doing much better than they truly were performing.  I was busy making notes and discovering ways to incorporate the best repair for this office staff.  While I was busy developing a mental plan to define how they must properly approach the best corrections for these wrongs, a customer walked in.

I was alone for that moment in the business office.  It was just myself and that new customer.  I have been inside this business model just three days after I had agreed to help them work out some posting errors.  The customer had no other reason to suspect I was not employed to take care of her inquiry as she walked in.  I offered to help her out.  It was a simple gesture and a very common thing to do.  The office staff was gone from the office at that time.  They were gone working on other things in another section of the business.  They actually left me up front in the customer service area, alone to deal with any customers that might walk in.  Guess what?  One walked in.

The protocols for performing proper business procedures was clearly and completely amiss.  It was lackadaisical and aloof.  This kind of casual respect for consumer approach is all too frequent in most business models.  We become too busy chasing our mechanical tails to address our guests as properly as we should.  

When that customer walked into that office, I was busy thinking about how to develop a business plan to correct some of the procedural bookkeeping ills I was witnessing.  I wonder how many business models are operating with this kind of challenge lurking inside their wares without the view of the damage existing that will soon surface to create a company loss?  How many business owners live their daily lives not seeing the errors their models perform?  I am not talking about mis-spelled words.  Those kinds of errors are trivial.  In fact, I am not talking about the troublesome bookkeeping errors, either.  I am talking about the more serious stuff business models do that hurt their growth in so many quiet ways.  I am talking about the errors committed in failing to improve consumer attraction policies.

This example is a perfect case to examine.  I find these errors typical.  The accounting was weak.  They were making serious errors in their bookkeeping methods.  The procedures were designed incorrectly.  As a result, double posting was occurring.  They were actually recording retail sales in duplication by using a double entry bookkeeping system that increased the human factor for unwanted, yet undetected posting errors.  The point of sale software was not compatible with their accounting software, as a result, they transferred the data from the sales software to the bookkeeping software manually.  The system for performing that transfer work was poorly designed and mishandled by undisciplined office staff.  Need I say more.  It was a huge business problem for the owner.

Last year this business model had a record year in sales.  It is also dealing with a multitude of late payments, poor expense controls, some serious money mismanagement issues and many 'over-run' payroll costs.  In short, the business model is failing.  The owner is frustrated and has pushed his frustration to the point of speeding up employment turnover within his office staff.  He has hired five office managers in two years with similar results, a mess in the accounting methods.  Consistency and accuracy have been seriously compromised.  It has now grown to dominate unwanted movements in his business model.  

When posting errors occur, especially in the revenue areas, incomes can become inflated.  False growth becomes real growth illusions that ultimately govern how we spend what we think we have.  Debt grows out of control.  It is a simple pattern that can become hard to repair.  Eventually, the business gets too far behind to properly capitalize the good business it is performing.  The tail begins to wag the dog.  This is where this business owner has arrived in his business model.  Now, here I am, three days into my evaluations and facing a new customer who comes through the door with nobody around to help her out.

The real problem for this business model has finally arrived.  We now have become relegated to poor service.  Poor service has taken charge of the business movements.  This unwanted pattern is so typical of those business models who get too far behind the funds they need to operate well.  Poor consumer respect inches its way to the front of the business bus.  Sooner or later, that poor service slips forward enough and climbs into the seat of that steering wheel and drives that business bus.  Time is the only thing remaining between operations and failure.  This business model represents all of those who are on the path of failure.  It has nothing to do with the economy.

Page two.

It Goes Beyond A Rock And A Hard Spot

In that office on this day, I address the customer with a friendly welcome.  I define who I am and promise to get her some qualified help.  I look to the new phone on the desk and recognize the VOIP system.  I read the screens and begin to push the buttons of my best choices and page the shop where the mechanics are working.  The language on the pager from that shop was not the kind of word patterns the customer needed to hear.  I smiled sheepishly at her while we both put up with the phraseology's we received from the boys in the shop on the intercom of that phone.  It was embarrassing, not to mention, bad consumer language.

I was able to define what my challenge was and completed my request to have someone come up front to help this customer with her questions.  She was thankful and respectful.  Soon, another employee came up front to see what they could do to help this customer out.  I was told the bookkeeper was gone from the site because she was picking up some parts for one of the mechanics.  The other office staff had left to take care of a personal problem off site.  I was actually left alone to deal with whatever was happening in that office for the day.  People.  This is exactly how your business models lose.  The disrespect for professionalism is often times out of control.  Guess what happens when that becomes true?  Your walk in customers recognize this truth.  They quietly decide to choose someone else.  My goodness, how do we grow up to miss this simple pattern?    

I know the books are a mess.  The owner knows that his business books are a mess.  But why should we accept to discharge that problem into the face of the consumer when they arrive?  We do not need to allow the customer to recognize the business as a mess?  The customer will use that information in their decision making models when they are determining who to select as their place of choice.  Consumers are not stupid. Do not get lost in the forest of business pain and delegate those frustrations to become the welcoming committee for your next customer arrival.  I see many small business models do exactly this mistake.  People, this is poor marketing.  Get rid of it.

When the customer gets this kind of uncomfortable feeling they choose to go somewhere else.  They know when they see unorganized work.  They know when they see unfit procedures.  They know when they feel left out.  They know when they uncover wrong doings.  They know when they sense dysfunctional patterns.  The customer has some of the best senses for recognizing wrong patterns of consumer support.  An empty front office is never a good sign.  Never.  When a customer walks into your business and finds nobody around, the immediate response in their heart is how under-served their entry was treated.  It sets a standard of response that must be overcome.  It requires extra effort to build up that empty welcome.  It is your business.  They are your customers.  There is no greater lesson to be learned.  Everything else is a compromised excuse.  Messed up business models do not easily see these signs.

You can chase bad bookkeeping all day long but to ignore that customer greeting with a lack of proper attention, the lack of kindness and the lack of polite respect is to place their visit too low on the scale of importance.  A model that performs this default of bad activities is a model that is too wrapped up with its problems for the day.  Customer visits become unwanted challenges.  This is the best sign that your business is beginning to fail.  You can fix your books all day long but you will still have a lack of growth problem handing you fits, over and over and over.  Your success will always be compromised with this kind of consumer disrespect.

Profitability shrinks quickly under this method of management.  Deep discounts must be levied to over-run the dysfunctional patterns that are stealing your costs and driving your services out of control.  With margins compromised while sales are slipping, the chase is futile until the end.  Some of you already know exactly what I mean.

If you lead a business model and your patterns of success are not coming as strong as they should, get help.  Find a way to work your respect back up to the levels your customers desire.  Get serious about respecting who they are, why they choose you and more importantly, give them what they expect.  Do not short change anything they prefer to receive.  By all means, make sure someone properly trained is there to greet them when they arrive.  If that simple step has lost value in your business plans, I suspect you have become to cynical to survive long term.

In all of my evaluations of the bookkeeping errors of this business model I was helping, the first customer I saw received the worst greeting and disrespect any business could ever dream to offer.  The problem has not been the books and the office managers.  Yes, they have been managed incorrectly.  The real serious problems of the business model remain tightly bound to the poor leadership qualities expressed in how the consumer attraction policies are respected and truly offered.  The consumer is at risk when they arrive through those doors.  That is exactly how most business models eventually fail.

Until next time...