November 2024
Volume No. 25, Issue No.12

A sympathy vote is not going to work

Those of you who have read this newsletter for a long time (this issue is our 300th!) know I have a deep love and appreciation for local businesses.

While I want everyone who takes the brave step of starting their own business to succeed, I will bluntly say there are many small businesses that need to go away. Examples of this are to follow.

Social media has a constant train of messages about doing business with a local business. Unfortunately, too many of these messages are based on trying to make a person feel guilty if they spend money in any chain store. These same messages attempt to make you feel even worse if you don't support a local business. And then there are the social media posts asking people to support local businesses with a sympathy vote.

Every local business has to earn the business. Yes, the dynamics between the big businesses and local businesses are not the same. But, that is nothing new.

Local businesses cannot ask people to pay extra for products; support a business that does not have convenient hours; or have staff that gives poor customer service.

Let me share an example of a recent experience. A trip to a local coffee shop found six employees behind the counter. Three were in a conversation with each other and the other three were performing tasks behind the counter. The line of customers was growing. Finally, the question was asked, "Is anybody going to wait on customers?"

One of those performing tasks at the counter responded, "They will be with you in a bit. They are training a new person".

There are plenty of local businesses that get my business because they make a point to deliver the extra effort to make a person feel welcome. I drive 20 miles to a garden center that has a very knowledgeable staff. I have a rotation of local restaurants I favor because of a combination of reasons. And, there are those small businesses I won't make an effort to do business with because they do not make an effort to take care of or know their customers.

If we as small businesses are going to have more business, let's do so because we earn it. We aren't going to shame anybody into doing business with us.

When one square is better than another -
Article of the Month

The Article of the Month is very appropriate for brick-and-mortar small businesses in these last 61 days of the year. You have a specific amount of square footage within your business. Expense-wise, they cost the same when it comes to rent, taxes, and utilities.

However, production-wise, certain parts of your sales floor should be producing more sales per square foot than other parts of your business. You should know what areas of your business are producing these increased sales.

Are they producing more sales, and more profits, because of the location or because of the merchandise? Minor rearrangements on your sales floor can go a long way to making this a better holiday season for your business.

Article of the Month

Fix This Next -
Book of the Month

Fix This Next by Mike Michalowicz. Just seeing the description of this book, I knew it would be a worthy suggestion. I can't say it better than what has already been said.

The biggest problem entrepreneurs have is that they do not know what their biggest problem is. If you find yourself trapped between stagnating sales, staff turnover, and unhappy customers, what do you fix first? Every issue seems urgent - but there is no way to address all of them at once. The results? A business that continues to go in endless circles putting out urgent fires and prioritizing the wrong things.

Book of the Month

Days of Inventory on Hand -
Internet Tool for Your Business

All businesses with inventory should give this information a close examination. The "Days of Inventory on Hand" calculation tells you how many days your inventory would last at the current sales rate. Where we see it frequently considered is when the owner states they are having cashflow challenges.

If cash on hand is low, this is the first place we look; what is the difference in "Days of Inventory on Hand" in the last six months? There is a good possibility this number has been increasing. The business may need the inventory, but there is not the cash to pay for it.

This is a good time of year to take a look to see how your business is doing.

Each month we highlight one of the 47 free tools on the Profits Plus website; we call them "calculators". While some provide analysis by numbers and ratios, some are assessments and others are self-examination questions. Many are downloadable while others, because of the complexity of the calculations going on behind the scene, are a part of the website and allow you to print your answers. None of them require you to give any personal information nor are there any "cookies" tracking you or your information.

Internet Tool of the Month

What a reward is not -
Staff Incentive for Your Business

We read a survey of some 1,000 people asking what they did with their last bonus or incentive that was cash. 30% responded they paid bills. Another 18% did not remember. Perhaps this shows cash is not a good way to reward or incentivize staff.

Over the years we have shared various ideas for rewards. We think the idea of asking employees what they would enjoy or want to do is the best idea.

We want to recognize A Carrot A Day by Adrian Gostick and Chester Elton, whose book provides the basis for each month's incentive idea.