Traits of great
What great business owners do
‘What am I missing?’, was the question that was asked by the owner of a multi-location business. While their operations had been in existence for several years, there were also challenges that caused the owner to sense that they were not achieving what they should considering the amount of money they had put into the business. The amount of time invested in the business plus the knowledge the owner had would lead one to think that a very profitable operation was all but guaranteed.
While the owner did not know was missing, she was correct in noting that something was missing. ‘What do the really good owners do?’, was her follow up question. And when asked how she defined a ‘good owner’, the answer was a combination of profit and having a sense of organization to their life.
There is not just an answer that would fulfill the questions, but instead some insight that could provide some guidance. We’ll take a look at a list of observations in this and the following issue of PWA Newslink. These observations will include the individual as well as the business as the two are closely intertwined.
The first observation is the ability of the business to focus on the customer. While a rarely seen type of customer service is awesome to watch with any business, we are first observing how the business has mastered marketing.
Marketing starts with the business creating an image in the customer’s mind. Get a group of employees together one evening and decide at the last minute to order pizza. Whose pizza do you want? As people give names of various pizza places, the businesses named have earned TOMA – top of mind awareness with that customer. A parts business should do the same thing.
There are a lot of details to building that image; signs, website, uniforms, vehicles, paperwork, as well as anything a customer can experience that causes them to think of your business.
The second component is that the business is not trying to be the parts house for everyone. Instead, the business has clearly determined who their customer is. The business focuses on this individual with the effort of selling as many things that customer needs; this as compared to trying to sell a few items to as many customers as possible. This is a vertical strategy instead of a horizontal strategy. Or as the saying goes, ‘the better you niche, the more you get rich’.
A key component of this second part is the utilization of technology. It does not mean the owner has to be proficient in the usage of the latest smart phone. However, the computer system can tell a lot about inventory turn, return on investment, merchandising on a show room floor, staffing, delivery vehicles, and most everything where many owners are guessing or making decisions because that has been the way they have always done things.
Of course, financial understanding is crucial. It does not mean that the owner has to be a CPA, but they do need to be able to carry their share of the conversation as they speak and work with the accountant. The financials have to be more than documents; they have to be guidelines which give insight to what has happened and how to use that experience going forward.
We have several more ideas to share with you; Join us in the next issue as we give some more of the traits of the great.