Is your business healthy?
Don’t jump and answer yes if the income or profit graph for your past year looks similar to the graph in the picture. Having a healthy business is not only getting higher profits or more income.
If your numbers snap into the graph you are on the right track, but have you considered any risks that could turn that graphs upside down in a matter of weeks? If you haven’t it is time to start doing so.
How many clients do you have? Is any of them, or a combination of clients in a monopoly position?
If you answered just a few or enough for the first question, then you expose yourself to a lot of risks. Here’s just a bad scenario I could think of right now. Half of your clients decide they no longer need you! Yes… it can happen. Think of this as the worst case scenario. Your revenue drops to half before you have time to cut your costs in half and in a blink of an eye you’re now on loss.
A good solution is to get more clients. You’re probably be okay when your answer to this question is somewhere close to more than I can handle.
What about the monopoly?
I am referring here to revenue monopoly, not anything else. Is any of your clients or a combination of a few clients generating more than 50% of your revenue? If yes, you’re again big trouble and walking on a very risky slope. If the client or clients combo suddenly cancel your services, your income drops by half again. Your costs remain the same and all of a sudden you’re on loss. Again!
So, if you do have a couple of clients generating most of your revenue, start getting more clients and diverging your income streams away from the few channels you’re currently on.
There’s more to it…
Of course the above are just a couple of ways one thriving business could go bust in no time. There’s a lot more things that could go wrong, and if you think of any please share them.
Details Matter
It’s the little details that make the difference. Everybody must have heard that at least once but few actually realize the impact small details can make. Smallest details can make a client stick with you a while longer, separate you from your competitors or give you the chance to raise your prices and earn more. That’s because small details make up the quality.
Case study Pizza X
Or why I won’t be ordering pizza from a quite successful pizzeria in my hometown. I say successful because it’s well established and they do great for home deliveries. Last week I ordered three different pizzas. One was supposed to be a Margherita without olives, as I hate olives. I really do.
After I picked up my order I realized that my Margherita had olives, and while grabbing a bite off one of the other I almost crushed a tooth because there was an olive seed. Not a whole olive but an olive seed mixed within some small bits of sliced olives.
To top the whole thing, the pizzas’ crust was hard and awful. Wrapping things up, here’s the three small details that made me erase Pizza X’s number from my contacts:
- One pizza contained olives even though I asked not to have olives
- Pizza contained olive seeds
- The crust was hard, kinda like old and dried bread
Case study Total Taxi
I don’t travel a lot by taxi, but when I do I make sure it’s Total Taxi (when in Cluj). Why? One morning I needed a taxi so I looked on the net for a company’s number. Rang them, got a car in a couple of minutes and went to my destination. I liked the company because they talked really nice on the phone, kind and respectful, and the driver got really fast in front of the building.
But a couple hours later they sort of blew my mind when I called for another ride and the lady and I had the following conversation:
- Me: Hello, I would …
- Taxi rep.: Hello Bogdan, would you like a taxi at [my address]
- Me: Oh, hi… Actually no… need one at [the new address - the one were I got earlier via their cab]
- Taxi rep.: Ok then, a car will be there in 4 minutes
- Me: Great. Have a nice day
- Taxi rep.: Have a nice day
Then, 4 minutes later I got in my taxi and the driver greeted me and asked if I wanted to go home. Yes, yes I did.
Technology surrounds us at every step and these guys are putting it to good use. It’s not that hard to store in a database a couple of names and addresses.
Pay attention to details
Therefor next time before you release a new product or service make sure that details are taken care of every step of the way, because it’s the details that can make you grow and have great profits and enjoy your business, but it’s the same details that can make you file for bankruptcy!
Names in the case studies are fictive.
