The 3 Ingredients!

Two partners were working on their business plan.   One turns to the other and says, "Let's sell our widget for $100 - that's lower than anyone on the market.  We will make a killing!"   The other partner responds, "But that's less than it cost us to make them."   "Don't worry...we'll make it up with volume!   Yeah...bad joke and you have probably heard the punch line before.  It would be comical if so many businesses didn't have balance sheets that played out this way.  Having reviewed many businesses...small and great...I have seen it too often.   If you are just getting a business started, then it make take some time to become profitable.  New, large corporations sometimes forecast it will take years before they turn a profit.  Of course, they have the luxury of OPM (other peoples money...can you say IPO?) and time.   Does your business have large cash reserves...time?   If not, then you have to have a profit slant today and everyday.  How do you ensure that you have set up your business model for profit?  You make sure you have The 3 Ingredients.  If you design your business with these 3 things in mind, it won't be long before your Income exceeds your Outgo...profit;   "Making money is art and working is art and good business is the best art." Andy Warhol   I am not a Harvard MBA (fooled you...didn't I?), but I have owned enough businesses and worked for enough that I have seen the pattern emerge.  The 3 things you have to have to be mindful of to make a profit;   1. Margin 2. Core Competency 3. Tactical Ability   Margin - How do I make money?  Seems like such a simple question, but one many business owners don't ask until they find out there is no money to be made.  It is largely about the products you offer and the "spread" between what you get for delivering it and the cost of that delivery.  This is the key to making sure your business isn't the "punch line" from earlier.   Core Competency - What am I best at?  It revolves around the natural and developed gifts of you and your team. Trying to be all things to all people will leave you doing things that aren't in your "wheelhouse".  Don't follow or copy others unless you have the gift.  Do what you do...and do it better than they do!  "Jack of all trades...master of none".  That will hurt profitability.   Tactical Ability - Will I do it?  Doesn't matter if you have the skill if you don't have the will.  Many sales people are talented (core competency) but don't have a process and the discipline to follow it.  You can't be aimless and haphazard.  You need a plan and then do what the plan says.  Great plans require great execution.    There you have it.  Simple...right?  Until you begin to review the way you run your business today.  If you are making money...the 3 ingredients are in there...I promise.  If you are struggling to make profit, then adding them will be the foundation of your turnaround.    The next two days will be devoted to helping you E4 your business - Evaluate, Evolve, Expand and Explode your business...making it a a profitable one!   You can send my 10% consultant fee to...   Just kidding...    Your business just called and said on the way home can you pick up bread, milk, eggs...and   The 3 Ingredients!   Until tomorrow, I wish you Money, Power, Success!