We work pretty closely with a couple hundred businesses as coaches or service providers, and the one thing that every single one of them will say at some point is “I’m just too *$&^#@@ busy!” There are three possible causes for this, and I’ll explain what they are and how to fix them in just a moment, as soon as I confess …
Yep, I’m busy too! So I feel your pain. Where I can help, is to tell you what causes it, how to fix it, and how to know if you even should fix it – and it is that last bit that is the key, so read on.
Let’s address the simplest cause of over-work: bad management! If you don’t know how to turn loose of responsibility or hire, train, and manage staff, then you shouldn’t even be in business – no really, I mean it. Management is the single most important thing you will do and there is no way to have a viable company until you get at least decent at employing other people. So just decide now to get good at delegating and managing people.
Of course, you will actually have to pay those people, which means you have to find the money.
The money to hire people – so you aren’t so busy – comes from Gross Profit Margin (GPM). What if it’s too low? For example, selling cameras online as an affiliate might (on a good day) net me a 4% margin. That won’t even pay me, much less anyone to help. Affiliate marketing of highly competitive products is simply a bad model. No amount of work, and certainly no addition of staff, is going to fix that. At the very least, you need to increase your GPM.
Unless, the camera cost as much as a house. Real estate brokers do very nicely on thin margins because the transaction size is so large. Granted, there are some things about real estate that make it special, but it is not the only business that thrives on the combination of thin margins and high transaction values. We have a client that does exactly that and has done so very successfully for over a decade.
So start with your business model and the basic math of your business. There really is no fighting either the model or the math. If the numbers don’t work, you will simply never win, and no amount of hard work or great staff will fix it.
How do you do that math? That’s simple. How much do you have to pay to hire people to do what you do. Put THAT number into your budget, not the deferred or nonexistent salary you are taking now. If you can hire all the work done plus pay yourself, then you have the makings of a good business. All that’s left is for it to be big enough.
Pretty much every business sucks when it’s small. The fixed overheads are too large to cover with small revenues and there are not the internal resources to do everything efficiently, or maybe even at all. This reduces net profits and makes it even harder to grow. This is where I find a lot of business owners – stuck small – and it really is a frustrating place to be. If you just had the money to hire, you could grow, but you have to grow to get the money, and you can’t ‘cause you can’t afford the people … and around and around we go.
Nobody can run this mouse wheel forever. Everyone is going to get tired of it eventually and just give up. This is the classic “throwing the baby out with the bathwater” because there is probably nothing wrong with the business that can’t be fixed … you just have to know how!
Being able to break the cycle of “stuck small” is one of the key differences in knowing how to grow a business vs knowing how to run a business. Could be that you are running your business just fine – though maybe running a lot faster than you would like – but can’t seem to make your company bigger. In practice, there are two strategies to get past this: more resources or greater focus.
Adding resources is the “easy” way, well, easier, but it almost always means getting funding. This could be investors or loans, but all money comes with a price so you better have a plan. If you do it right, this is very definitely the fastest path, but even the best funded companies still fail at a daunting rate, so don’t ever think that success is all about getting the money. Absolutely get it if you can, but money is not the cure, it’s fuel for the fire, and that can go either good or bad.
The other path to getting out of “stuck small” is greater focus. We start with our vision for what the company will be once it is grown, but in the meantime we can’t do all of that, so we focus on a subset of products or subset of the market that allows us to change our math enough that we’re able to grow. The more focused the business model, generally the more efficient everything becomes.
In software we talk about the “Minimum Viable Product” – what is the smallest set of features that we can release that will be useful to our customers and viable in the marketplace. This reduces our development cost, reduces time to market, and makes even the marketing easier.
The same concept works outside of software as well: what markets and products can you defer until later? Does greater focus change the math? Almost always it does. For example, it could reduce your cost of sales, reduce your support costs, lower some fixed overheads, increase your average profit margin, create greater marketing efficiencies, or even allow you to change some competitors into partners.
Pretty much every business problem can be fixed by looking at the Model, the Math, and the Marketing.
So Why are you Busy?
First make sure you aren’t doing stuff others can do instead and then look at the math and the model for your business. If you are really small, you are going to have scale problems and there is no way out of busy other than growing bigger. If you’re growing now, maybe you just have to push through it. In a rapidly growing firm, you will be busy sometimes as you catch up needed resources to new revenue. Then you’ll be top heavy for a while as you grow revenue to pay for those new resources! Ask me how I know this. 🙂
And accept right now that it will be uncomfortable and chaotic.
Growing a company is going to feel like being a gangly teenager: their parts grow suddenly and at different rates and they just barely get used to one new size and shape before some other part grows and throws them off balance yet again.
In a growing business, every time we get one system in place, one new group of employees trained, or some new product offer optimized, we have to go fix the next fire. As teenagers some of us put up with “growing pains” for 2, 3, or even 4 years. Your business will likely take at least as long and be even more painful!
But just as teens are denied many of the benefits of adulthood, your mature business will provide a kind of freedom not otherwise possible, so just push through it. It’s not forever and the rewards are well worth it.