Numbers! Don't have the right sales volume? Costs to high? Competition driving prices down? There are a lot of numbers you can point to. Certainly, you can't control all of the factors impacting your numbers. But, most of the things you'll list are really just symptoms - not the cause. What's really stopping you from making a profit?
My experience from talking with hundreds of small business owners indicates several causes for them not making the profit their business is capable of. In come cases, the owner hasn't made an active, dedicated, daily action decision to "make a profit". Others, don't know enough about their numbers to know where to make the changes in their business activities to increase their profitability. Still others, perhaps most, want to increase their profitability, know their numbers, but don't know what to do on a daily basis to create more profitability. Finally, action is required to make a business as profitable as it can be and deserves to be.
No decision leads to less profit. Keeping up with the daily demands of running a business can get in the way of making clear cut decisions. You start your business with the best intentions. Your goal is to make a living (that's not profit) and, ultimately, make a profit - a return on your investment. Somehow, once the day gets launched all bets are off. Not renewing your decision to make a profit every day may be stopping you from making a profit. Don't let a busy day get in the way of making a profit.
No numbers leads to less profit. I trust you have a set of financial statements. And, your statements break out the numbers in the categories impacting your bottom line. If not, STOP. Do not pass Go, do not collect $200, go directly to Jail. This isn't about Monopoly money. It's more serious than that. If you've got the statements, use them. Use them to impact today. Don't just review them on "Monday Morning".
No knowledge leads to less profit. You can not know all or be all. However, there is no lack of good, solid, "how to" information available to you. Action is required to access the information, absorb it, formulate a plan, implement the plan and continually adjust your plan. Where most fail is in "learning and doing".
Optimum profit comes from action. Perhaps your business is profitable and you don't have a clue why. Don't be too excited. What's stopping you from making the profit you and your business are truly capable of? Make a decision. Know your numbers. Make it happen
Don Osborne is the author of The Profit Puzzle - a website to help you envision, plan, start, run and grow your small or home based business. The Profit Puzzle Directory links small business articles, books, courses, products, services, websites, blogs, and software covering objectives, management, finance, personnel, marketing, operations, production and resources. Use BizBuzzLink to easily share your links and quickly build your own knowledge network.
[tags]small business, home based business,finance,financials,budget,profit[/tags]
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