Business is an endless series of moves. You evaluate where you are today, envision where you want to be in the future, develop a plan, and move (i.e., take action).
Life is like that, too. It’s an endless series of moves. Some are easy, and some are hard.
I’ve moved a lot in my lifetime, both personally and professionally. Here’s something I’ve come to believe…the longer you stay in one place, the harder it is to move.
In the case of a home, the longer you live there, the more stuff you accumulate. That means when your heart says it’s time to move, your brain says, “ok, but we have to deal with all of our stuff too”.
In the case of a business, you accumulate a culture or a way of doing business. You might fall into the “we’ve always done it this way” trap.
We’ve always offered traditional funerals, and we’re good at them.
We’ve always served families from a particular church.
We’ve always made a good profit on caskets.
In your personal life, boredom is often the catalyst for a move.
In business, the catalyst is your cash reserves.
If you don’t have enough money, it’s time to move.
If you have money but see an opportunity to make more, it’s time to move.
Next week, I’ll discuss what to do if you have money and see opportunities. This week, I’ll discuss the harder one…you don’t have any money.
Step 1 – Evaluate where you are today
A business with no money doesn’t last very long. It’s like an airplane that’s run out of fuel. You might be able to coast for a while, but you’ll crash eventually.
First, is this a short-term situation you must get through? Or is this a longer trend that must be addressed?
Do you have other assets to work with? Your business has value, and so does your property and facilities. Is there a way to sell off something to raise cash?
Step 2 – Envision where you want to be in the future
Do you want to sell the business and retire, or try to fix the problem and turn the business around? There’s nothing wrong with either choice, but you must decide before moving to the next step.
You may have a vision for having the largest funeral home in town, but your first goal is to become profitable again. At this point, it’s important to focus on the problem in front of you.
Step 3 – Develop a plan & move!
If you want to sell and retire, the plan is simple. Hire a good broker and start fielding offers.
If you want to fix your money problems and turn the business around, here’s what I’d suggest.
First, you need to find some cash ASAP. Here are some common first steps.
- Lay off all non-essential staff. As hard as it is, it’s time to reduce your staff to a small group of people who will work as a team.
- Close down any part of the business that is not making money. You must stop the bleeding, which might mean closing a branch location that doesn’t help your bottom line. It might have been your pet project, but it’s time to shut it down.
- Renegotiate your long-term debt. Refinance everything you can to lower your monthly payments.
- Consider selling your building but not your business. One of my clients worked out a great deal with a local church pastor who needed a bigger building for his growing congregation. My client rented a smaller, more modern facility and used the cash to fund his turnaround marketing campaign.
Now that you’ve found some cash, here’s what you do next.
- Fight the urge to market the same way as large corporate funeral homes. The big guys often have more money than sense, and if you follow their lead, your cash will disappear quickly.
- Pick a niche you can dominate. Do not try to win every call in the market. Instead, carve out a slice of the market that you can dominate. It might be a specific faith or ethnic group but it is also possible to succeed by being the multi-cultural funeral home in town.
- Give people a clear reason to choose you. Maybe it’s your low prices or some unique service packages. But you have to give people to choose your funeral home, or they’ll go to the one they’ve always used.
- Create a multi-step marketing campaign to connect with your chosen niche and ignore everybody else. Don’t waste money putting your marketing message in front of people who are not your ideal families.
A business without cash will crash. It’s only a matter of time. Remember, business is an endless series of moves. Evaluate where you are today, envision where you want to be in the future, develop a plan, and move!!
Contact me if you’re serious about saving your business and want my help. I’ll find an affordable option to get you started on the right path to turn your business around.
Until next time,
John
PS: Next week, I’ll discuss what to do if your cash reserves are in good shape and you are considering an opportunity to take your business to the next level.
