I love reality shows. I really do. They give me instant access to the most fascinating and curious things. Things that I would never experience otherwise.
I would never intrude into a hoarder's home to gauge how they are manifesting negative experiences from their life. And I can say with absolute certainty I wouldn't pack a ton of TNT under my car to see if I can bust some myth about exploding cars (even if I could use the insurance money.)
While I wouldn't do any of that, I like to watch it. But there is one problem. The “reality” that ultimately airs is only an abbreviated highlight reel. They only see the story the producer wanted to get across, not the full reality.
Business rescue shows are no different. They are fascinating to watch, deliver concise lessons, but don't divulge the full transformation that the business owners go through.
I have the great fortune of being the segment host for MSNBC's Your Business makeover shows. Myself and a team of experts, producers and volunteers get injected into struggling businesses that are in a real need to turn their businesses around.
In all the makeovers I have done (the next one airs on August 28th at 7:30am on MSNBC), I have found three common problems holding each businesses back. Yes, each business has its unique challenges. But, there is a clear underlying current of problems that each and every business experiences.
Maybe the next episode will show the “core three,” but the final cut may focus on something else. It all depends on what the production team finds to be the most compelling. At the risk of a major spoiler alert—there was some really crazy, cool, unexpected stuff that happened, so I don't think the “core three” challenges will be discussed much. And that's why you need this insider's look into the true reality of struggling businesses. But before I do the big reveal, let me start with this unexpected twist.
I have yet to see the lack money ever be the cause of a business failure. I have found, if anything, the cause of poor cash flow is a direct result of a failure somewhere else. It is hard to believe at first, but every time I dig into a cash strapped business one of these three challenges rears its ugly head:
1. A failing first impression
Small businesses inevitably think they need to get it right—everywhere. Have a killer website, backed with awesome customer service, a logo to die for, awesome company uniforms, minute-by-minute social media updates and super signage every where. While every struggling business tries to do it, they all fail to pull it off.
The reason? Because it requires multiple full time staff members to do it. Even the big corporations struggle to be perfect on all fronts.
The solution? Don't strive to do it all. Strive to do as little as possible, but strive to wow them in these few spots. Don't have enough money to do a beautiful, detailed website? Build a single amazing page that directs prospects to an e-mail form or a number to call you.
The idea is to limit the number of areas you can make a first impression, and to impress the customer in those few spots. Focus on having an incredible website, or an amazing business card, or signage that is a pure wow factor. Over time you can build on over fronts, but just make sure your first impression is always amazing—and if it's not, don't do it.
2. Selling stagnation
A struggling business can often be better described as an exhausting business. Work, work, work with little progress, barely hanging on. This constant struggle locks the entrepreneur into a repeating pattern of no progress. It feels like there isn't enough time to try something new, since all the available time is being used up.
The fix is to make a significant change in the sales approach. You need to take a short break (an hour is usually enough) and look at what sales efforts have yielded business and what hasn't. Been a member of the local chamber for a year now, yet haven't got a signle sale from it? It's not working. Been hosting a monthly networking group in your office, and it has brought in some new business? It's working.
Study all your sales efforts over the past few years, from the yellow pages to networking events. Then start doing more of what is working. And stop doing what is not working. As a final step, try new ways to sell that you will be able to apply to the working/not working test a few months down the road.
3. Never saying no
It is almost uncanny how many struggling businesses have owners who work like mad. How can they be so busy, yet can't make a penny? The reason is they say yes to everything.
A call comes into a struggling mechanic shop for a car tow—and they say yes. Not because it is what they do, but because they need the money.
If we play out this example you can see the problem clearly. Your ace mechanic (which in most small businesses is you) is now out towing a car and not fixing a car. You are now doing something you are less efficient at.
I know what you are thinking. “The shop was quiet, I was going to just be sitting around. Now I'm making money.” Not true. Yes, you are making money, but you are making money on a tow job. Even if you impress the customer you are towing, any referral you are likely to get will be for a tow, further distracting you from the core business. Potential customers may have called the shop, but you weren't their to answer the call. And worst of all, you couldn't wow your existing customers by putting in extra time and effort to finish their jobs early, or better, with a pleasant surprise. That means less wowed customers, which means less referrals for auto repair work.
So there you have it. The core problems that undermine every single struggling business. Whenever I am asked to go and help these companies, I always look for these problems and all three are there every time.
But, now you know the three problems they all face. So look into your own business and see if one of these common problems (or all of them) is running a muck. Fixing them will make your success...well...a reality.