Thoroughbred horse racing is a lot like the small-business market. In almost every race, you have horses with varying levels of talent trying to win the race. Some horses are veterans that have run numerous races, while others are first-time starters. There are horses who like to get out in front and horses who like to come from behind.
Horse trainers use a number of tactics to keep their horses focused on running and winning races. Some will use a shadow roll so their horse doesn’t look down and get spooked by the shadows of other horses. Different horseshoes are also used depending on the conditions of the racetrack. The most common accessory used by trainers are blinders, half-moon shaped leather cups that block a horse’s peripheral vision. Blinders help keep the horse focused on the horses in front of them and the finish line, blocking out everything on the sides and behind.
Blinders are also used by small-business owners, but they shouldn't be. Typically, business owners want to concentrate on sales, expenses and employees—and are "blind" to other things happening around them. They believe almost every problem can be solved with more sales, more productive employees and fewer expenses.
In business, what you don’t see is often what hurts your business the most. I liken it to getting hit in the back of your head with a 2x4. You never see it coming.
I mentioned sales, employees and expenses as the three main areas of focus for business owners. There are four other areas, outside of their peripheral vision, that business owners should keep their eyes on as well.
Competition. Unless you are the only game in town, other companies are vying for the same business as you. They call on your biggest clients and promise better services and pricing. Their goal is to take business from you. That said, do you know who they are and why you offer a better product or service? If the answer is no, take the blinders off and find out.
Social Media. There are two types of small-business owners who are in trouble when it comes to social. First, if your company has, say, a Facebook page, a Twitter account and a LinkedIn profile, but you're not really using it, this nonchalant approach could hurt your business just as much as the company's owner who has his or her head in the sand, waiting for social media to blow over. It’s as if they believe that the social media fad will run its course and be gone in a few years.
The truth is, social media is only growing. The shift in communications was fundamental and permanent. The longer you wait to get into the game, the harder it will be to understand how social media is used in business as a “means to an end.” Additionally, when you're blind to social, you have no control—it’s possible that people and other companies are writing negative reviews and comments about your business. Without a defense and a social strategy, you're allowing the competition or angry customers to compromise all your hard work.
Economic Indicators. Keep your eye on what's happening in your industry. For example, if you own a landscaping business, it makes sense to look at the state of the housing market in your area along with mortgage interest rates. A tighter market means people aren't spending as much on lawn care.
Insurance. As your business grows, your insurance needs change. When’s the last time you had an insurance checkup? Do you still have proper coverage in place? The worst time to ask an insurance question is after the accident, mishap or disaster happens.
As a business owner, you need to watch these four factors in addition to sales, employees and expenses. Take a 360-degree look at what's happening around your business to avoid any sudden surprises or mishaps. As a friend once told me, “A smart man learns from his own mistakes; a wise man learns from the mistakes of others.” Keep your eyes open and pay attention.
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Photos from top: Getty Images, iStockphoto