The Coach's Corner

Archive for April, 2014

Is your business designed to give your clients/customers what they want?

April 28th, 2014 // Tom Doescher //
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In our April 23, 2012, post, “Create your own path,” we encouraged business owners to focus on their customers’ needs, not on what their competitors were doing. You can be in what appears to be the same business as someone else, but chances are you have totally different clients/customers.

In our community, we have just such a situation occurring with two fitness clubs/gyms. We will attempt to contrast the features of each gym without promoting one over the other. Gym No. 1 has significantly more members, extended operating hours, many cardio machines, free weights and exercise machines, amenities like tanning booths and massage chairs, limited group training, and an attractive low monthly fee. Gym No. 2 has fewer members, some machines and free weights, and lots of group training options — some included in the monthly fee and others offered for an additional fee. Gym No. 2 is affiliated with a physical therapy (PT) clinic, which refers many members to the gym to participate in classes designed to promote an active lifestyle for life. Gym No. 2 refers its members to the PT clinic, too. We do not have official demographics, but the average age of Gym No. 2’s members would appear to be higher.

We have not seen any financial data on either gym, but it seems as though both are successful, even though they have two entirely different approaches.

Is your business designed to give your clients/customers what they want? Do you know what they want — or are you copying one of your competitors?

Is it better to buy at the top of the market or at the bottom?

April 14th, 2014 // Tom Doescher //
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This is not a trick question. At a recent automotive trade group meeting, two warm-up questions were posed to the participants. They were: “What sales revenue do you expect for next year?” and, “Are you planning to make any equipment or facility investments this year?”

As you would expect, the answers were all — except for our responses, that is — very optimistic. Not that we’re pessimists, but for years we have watched the shrewd operators know when to buy and when to wait. We don’t know if we’re at the top or near the end of the cycle, but modern economic history has shown that we don’t stay at the top forever. The smart operators are very calculating, independent thinkers who do not follow the herd. For example, Warren Buffet invested $5 billion in Goldman Sachs on September 24, 2008 (while most of us were running for cover), and made a very handsome return on his investment.

We’re not saying not to invest; what we are saying is that you should base your decision on hard data (i.e., booked business with realistic, predicted volumes), not emotions and hype.

By the way, remember that the goal is long-term profitable growth, not increased sales.

Are you absolutely certain you should build that new facility or purchase that new press now?

p.s. We know successful business is all about guessing right, so we encourage you to base your decisions on as many facts as you can.

The Advisor’s Corner

Tom DoescherYou’ll find stories from the trenches, business lessons, and pertinent questions to help you find inspiration, professional growth, and leadership savvy.

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