In this series of articles on how to double your business income, you’ve seen how powerful it is to go back and look at your business through the eyes of your customer.
You’ve also identified ways in which you can improve your customer service experience and start getting more referrals and repeat customers.
But there is often a huge difference between implementing the ideas you’ve learnt and keeping the business running smoothly at all times.
As your business income increases, you will have additional challenges that come with growth.
The main challenge for women is how to create balance between business and family. This is especially critical if you have small children who need more of your time and attention.
The Challenge: Overwork, Stress, Low Income
Many business founders reach a point where they’ve worked themselves to the bone. If you’re not there in person, then chances are that your business will not run.
Maybe your employees need you there to whip them into action.
Or there are customers who don’t want to work with your employees. They want personalized attention from you.
Things can escalate to the point where you’re always working, you’re busy putting out fires all the time, and the business cannot survive without you.
You no longer take time off regularly and even when you do, your phone, laptop and tablet are next to you. And when you do take time off, you always make sure that you have internet access or easily reached on phone – day and night.
The business has taken over your life!
If you don’t take action at this time, the growth that will come with increased business will overwhelm you and it can lead to the end of the business just as easily as lack of business can.
Step #3: The Solution – Business Model
The one thing that separates successful businesses from the rest is that successful businesses have business models that they follow.
When you walk into McDonald’s you expect the same kind of service, the same kind of food, the same kind of everything in all countries they operate. While concessions are made to localize some items, there is no compromise on quality and consistency.
The same thing happens with brands like KFC, Apple, Pizza Inn, and other successful franchises.
All these brands grew into giants simply because they use business models that are backed by well run systems.
You don’t have to be a big business to create a model. In fact, I’ve seen some pretty regular people create amazing systems and models in their businesses.
For example, when I was a trainer for one of the leading Kenyan personal development companies, I used to wonder how it was that the owner could take time off for months and come back and find the company running well.
The reason was because he had created a model that worked for him whether he was there or not:
- Marketers marketed the same way; trainers trained the same way; coaches coached the same way; office staff handled inquiries the same way.
- Everyone in the company, from the top to the bottom knew what the company was about. The driver could explain it you just as well as any other person.
- New staff members were trained in the core program and then inducted into their specific roles.
- Everyone did business according to the model and we never deviated from it. To quote one of the leaders, we were not allowed to “Water down the product”, with the product being the company and its services.
These systems allowed the owner to take time off when he needed to and he’d come back and find marketing, training, coaching, financial management going on and money flowing into the company.
It wasn’t until I read Michael Gerber’s book The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It (see list of recommended readings at the end of this article) that I understood that this was a model-based company and not a people-based company.
Simply said, a business that’s built on a tried and tested model will give the owner peace of mind because it can run on its own without him or her.
If your business needs you for its continued existence; or your customers want to work only with you; or your employees cannot manage the business when you’re sick or have taken a vacation, then you have created another job for yourself and not a business.
It’s also harder to change your business model later, so work in the business as if you have employees and create systems for each job along the way, even if you’re a solopreneur.
When I work with women who’re starting businesses, I get them to think through their business model as soon as we possibly can before startup. This is because it’s better and easier to start with a model than it is to create one when the business is established and habits have formed.
Have I convinced you about the need to have a business model that’s backed by effective systems? I hope so.
Basic components of your business model
1. A description of your business, product or service
What are you selling and how will you get it produced or delivered to your business?
What is your business going to be known for now and in the future?
Many small business owners keep changing what they offer depending on their mood, current fads or by trying to please everyone.
Don’t get caught up in this. Instead, be very clear about what role your business serves and don’t deviate from this role.
Make this description clear and simple such that an 11-year-old child can understand.
2. Identification of your customers or target market
Who are you selling to?
Go back to the previous post in this series and complete your customer avatar if you hadn’t already done so.
When you know your ideal customer, it will be easy for you and your staff to talk in terms that these people understand.
However, don’t focus so much on selling to your ideal customers that you end up being rude to those who don’t seem ‘ideal’ in this moment. Treat all people equal, but target your marketing to your ideal customers.
Test different marketing methods to see what works best to attract your ideal customers. Once they’re in contact with you, give them such a great experience that they come back and refer others to your business.
3. A description of the sales process
The easier your sales process is, the faster people will buy from you.
You don’t want people to leave and then go home and convince themselves that they don’t need whatever you offer. You want them to buy from you the moment they are in front of you.
You want your adverts or online presence to keep your business at the top of their minds so that when they’re ready to buy, they only think of you.
Some things to think about include:
- Where is your business located and how does this affect your prospects and customers?
- How will you receive payments from customers?
- Can people buy online or with MPESA?
- Do you need deposits for services and what are your terms?
- What is your credit policy? (be very clear and strict about this)
- How do you turn interested prospects into customers?
Just like customer service, your sales process begins before someone buys from you.
For example, I walked into a gym the other day and after looking around, I received a brochure advertising a boxing event that was coming up that weekend. The brochure ended up in the bin and I’ve never gone back.
If the sales person had listened carefully to my questions, they would have identified my real need and made a sale that day – I was that ready to buy. Instead, I went back home and dug out my Tae Bo DVDs.
Is this happening in your business?
Are you losing money because you and/or your staff don’t have a well-outlined sales process that moves someone smoothly from being a prospect into a happy purchaser?
4. Your distribution system
Once you’ve made the sale, how will the customer get what they’ve paid for?
This is easy for physical businesses because people come in, buy what they want and leave with it or have it delivered to them.
If people are buying online, then how do they get their purchases?
How long does it take between the time someone pays and the time they receive their purchase?
What is your returns policy and system?
What is your complaints policy and system?
Who makes decisions about returns and complaints?
Other things to consider include: how you keep track of new orders, pending ones, those in process, deliveries made, delivered orders that haven’t been paid for in full, and how you handle suppliers and people you’ve outsourced work to.
I’m not a financial expert so I cannot give you advice about this aspect of your business. However, there are some basics that you need to know and keep track of whether you have an accountant or not. These include:
- Income: How is money received and documented in your business? Where does it go? Who is in charge of it? How do you handle debtors? Do you take repeat orders from people who you and what is the cut-off point?
- Expenses: What are your regular expenses? Who makes decisions about purchasing or making payments? How are expenses documented and kept track of?
- Banking: How is money banked or withdrawn from the bank? Who are the signatories to the bank account and to what level? Do you have online banking access and to what level (e.g. just to check balances or full access that allows transactions)?
- Petty cash: How much is kept in the cash box? Who is in charge of the money? What is it used for/not used for? How is the money accounted for and after what duration? What is the process of replenishing petty cash?
- Financial management: Who has what role in financial management? How are decisions made and executed?
Find out what you need to add to this section as it can easily cause unexpected loss of income and unnecessary expenses.
6. Your administrative system
This is the core of your business model. Questions to ask yourself include:
- How do you manage your business overall?
- Who is responsible for what?
- Do you have clearly laid out departments, even if you’re a solopreneur?
- Does each department have roles that don’t overlap or conflict?
- Do you have an employee manual that outlines the responsibilities and step-by-step work plans for each role?
- How can you automate your administration without losing touch?
Once you’ve done this, create an outline of your organizational chart so that you can see at a glance what it will take to manage your business.
Starting with the roles at the bottom, outline what the person in charge of this role does every day.
Create Standard Operating Procedures (SOPs) for all roles so that the document becomes a live manual for training and for keeping yourself and your staff focused.
If you have employees, have them document what they do from the moment they check in at work to the moment they leave. Do this for a month and you will see the real role that this person plays. You can then compile the information into a working SOP for that specific role.
Once your administrative system is well outlined, use it to re-train your employees. You’ll also use it when hiring staff because from this moment on, you’ll be hiring people to fill roles and not creating roles to fit people.
Document as many processes as you can and update your manual each time you make changes in a process or find an easier or more cost-effective way of doing something.
Encourage your employees to help improve their specific roles and review your manual each year if you haven’t made any changes to it during the year.
Put It All Together
This article concludes the series on 3 steps to double your business income. The articles in the series are:
- 3 Steps to Double Your Business Income – Part 1 (Customer Service).
- Double Your Business Income – Part 2: Fill Your Business Through Word of Mouth Marketing.
- Double Your Business Income – Part 3: Create a Business Model.
Each of these steps will increase your income, but a combination of all of them will double or possibly triple your income.
It will take 4-8 months to complete all the steps and have a comprehensive business model that can run your business in your absence. When this happens, you will also have more time for yourself, be happier and able to grow the business to the next level.
To make the most use of the information contained in this series, give yourself 1-2 hours each day, preferably first thing in the morning or at a time when you can work without interruptions. If you have a team, involve them as much as possible in the process and delegate some work to them.
This process is outlined in such a way that you can do it in-house, so that you know exactly what is happening in your business.
I highly recommend that you don’t delegate the process because working through it will give you amazing information about your business. You can seek advice, information or help for specific pieces of work, but be 100% in control of the process and the results.
When you complete this process, you will have enough time and resources to delegate it in the future when your business model starts producing results.
If you think that you don’t have time now to complete these steps, then ask yourself, “What will it cost me in the future if I don’t do this today?” Your answer to this question will be your guide.
The articles in this series are by means the only way that you can double your business income in a year or less. They are just simple steps that will help you get moving today.
I’d love to hear how this series has worked out for you and any tips or resources that have worked for your business. Please share your thoughts, knowledge and experiences in the Comments section.
(Image credit: iosphere at Free Digital Photos)
- The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It by Michael Gerber.
- The Reluctant Entrepreneur: Turning Dreams Into Profits by Michael Masterson.
- Guerrilla Marketing in 30 Days by Jay Conrad Levinson and Al Lautenslager (this will help you clarify your niche and create a marketing plan).
- There’s a Business in Every Woman: A 7-Step Guide to Discovering, Starting and Building the Business of Your Dreams by Anne M. Holmes.
- The Princessa: Machiavelli for Women by Harriet Rubin (every woman should read this book!)