I qualified as an accountant in 1995. At the time email had just arrived and I had the privilege of having my own email account.
I remember it well. We would get excited and amazed when one was received and exceptionally proud if we received more than 2 a day. Equally, there was disappointment if I arrived at the office and opened email to find none had been received.
Oh, how I would love to go back to that.
In business things change constantly and we must adapt to changes or we get left behind. Many think that if you keep up you are ahead.
Since 1995 I believe I would have dealt with about 4,000 businesses in some form or another. If were we to take these 4,000 businesses, what would we find?
Well, within 10 years 3,000 businesses would have ceased trading, lost interest, gone bankrupt or died for some other reason. In other words, they failed.
A further 500 make it to 10 years but that does not mean they are profitable. They make ends meet and the reality is, based on hours put in, the owners would be financially better off if they worked for someone else. In other words, they are just surviving.
That leaves 500 businesses. What is happening with them?
Well, 300 of them are doing quite well. Not all singing all dancing, but more than comfortable. They have a good business, but it is likely that the success of the business is directly connected to the business owner. Take them out for 2 weeks or more and the business suffers.
That leaves 200 of the 4,000 business or just 5%. These businesses are all singing all dancing.
So, the question is ‘what are the 200 doing that the remaining 3,800 are not?’
I have found that all singing all dancing businesses have 1 main goal and do 3 things consistently. So consistent that it is ingrained in the fabric of the business. So what are they?
- The End Goal – Raving fans
When I ask what makes a successful business I get many answers. Big profits. A great team. Skills. Fantastic equipment. Happy customers. A service or product customers want. Systems that work to name just a few.
If your goal is profits you may find you run a successful business. But not always. It is why entrepreneurs (people who go into business solely to make a profit) fail the most.
But I have found that successful businesses have only one aim. They may label them differently, but the end result is the same.
They strive for RAVING FANS.
You see, you only get raving fans if most of your business is operating as it should. You see to obtain raving fans you must have a great team who have the right skills, the right equipment and systems that work.
So, if you concentrate on having raving fans then you must analyse your whole business and make improvements otherwise you don’t get raving fans.
And by the way happy customers leave. This may surprise you, but they do and when they do you wonder why because in your mind you gave them a good service or product. Raving fans don’t care about the few things that are frustrating or annoying. Just ask anyone who owns an Apple product. Whereas satisfied customers find small issues and make them into big ones and then leave.
Successful businesses also do 3 things consistently:
You may have the best product or service and a bunch of raving fans, but if no one knows about it you cannot scale or increase income.
Successful businesses make sure they scream from the top of their lungs about how good their product or service is.
They have no hesitation in getting testimonials or let others know they have a bunch of raving fans and they are constantly ‘in your face’
They are happy to spend money on marketing and never let it slip even during the tough times.
- Constantly evolving
And I don’t just mean new technology evolving. If you offer the same thing even if it is efficiently done you get left behind.
If you have raving fans, they have an expectation. So, you need to keep innovating and evolving your product offering. You must give them an experience that is better than everyone else.
Let me give you an example. WOW! Advisors & Medisuccess is predominately an accounting and tax business. But I rarely talk about taxes and financials. It’s mostly about working less hours, being financially free and being a business owner as opposed to a business operator. Getting a Will prepared was one area which we found clients wanted, but found it a hassle. I don’t blame them. Visiting lawyers who like to talk Humpty Dumpty is hardly appealing, so they never went, and Wills were rarely prepared. So, we innovated. We managed to get in place a system whereby we facilitate Will preparation and suddenly clients who procrastinated for 2 years were on board. The cherry on the cake is that we make money and clients think we are awesome because we solved a problem they knew needed to be solved.
What is it you need to innovate? Find out and then do it. Because if you don’t someone else will.
There is a restaurant I know. It had raving fans (over 300 reviews with 5 star rating on Google) and over 400 reviews with 5 star rating on Facebook. It was listed on Trip Advisor as one of the best places to eat in Brisbane.
So, it has Raving Fans.
It also had a great marketing system with constant posting on social media, news outlets and even on national TV – hence the large number of reviews.
They also innovated. The menu changed constantly with new varied dishes which meant repeat customers kept coming back and had variety.
So, you may be surprised to hear that this business had to close its doors as a failed business.
It had to close its doors because it did not undertake the final thing those 200 successful businesses do.
- Know Their Numbers
I have never met a consistently successful year on year business that does not know its numbers.
I can also tell you that of those 200 businesses not all the business owners understand their numbers. They just employ people who do.
The job of a business owner is to understand what the numbers are telling them and what they need to do to make money. If you do not concentrate on the money, you won’t make any money.
For the restaurant business above, they never looked at their figures and because they did not, they were unable to analyse what the figures were telling them. They only looked at sales and always commented on how busy the restaurant was.
The reality was the restaurant was providing premium food without charging a premium price and as a result overheads were not met. There were other issues too which if they had analysed the numbers, asked some questions and made changes would have made the business profitable.
If you make profit your goal you will not achieve raving fans. You must have a goal of raving fans but understand that on its own is not good enough. You need raving fans and make money.
When you have these two (raving fans and good profits), you have achieved a successful business.