The 7 Secrets to Reaching the Magic $Million Mark
By Julie Lenzer Kirk, Path Forward International
Fewer than 5 percent of businesses owned by women ever realize annual revenues over a million dollars. Why is it so hard, and how can you build a business that surpasses the million dollar mark?
Taken from my book The ParentPreneur Edge, which includes my own personal experiences and those of other companies who have surpassed the Magic $Million Mark, I have identified seven secrets successful million-dollar-plus companies have in common that seem to be missing in those that can’t quite hit the mark.
1. Know your customer.
If your business targets “all women” or “any business,” you do not know your customer. Not all women have the same needs, wants, and desires. All businesses don’t operate the same way or value the same things. In order to catapult your business, you need to know intimately what your customers want. Why do they buy? Why don’t they buy? Get inside the head of your customers and when you know how they spend their day, you’ll be well on your way to locking them in on a sale.
2. Proactively manage your cash flow.
Once you have revenues coming in, it is crucial that you continue to maximize use of your cash. Keep your money as long as you can and get money from those that owe it to you as soon as possible. This means negotiating good (quick) payment terms from customers, good (long) payment terms with vendors, and never paying a bill before it is due.
3. Hire the best people, even if you have to pay them more than you are making.
Research shows that the success of a company is largely centered on the execution. The execution of your business idea centers not only on the plan but also on the people you bring on board to execute it. Hire people that are smarter than you are, and don’t hesitate to pay them more.
4. Exceed your customers’ expectations.
The first step in incredible customer support is to set and communicate expectations. Many a relationship (and customer!) has been lost over this one issue alone. Once expectations are set and understood by all parties, you must over-deliver. Exceed the customers’ expectations and you’ll have them coming back again and again.
5. Build on your success.
The least expensive customer to sell to is one that you have already sold to. You must build repeatable success within your customer base.
6. Practice “Focused Flexibility.”
Although it sounds like a contradiction, Focused Flexibility is really about keeping your peripheral vision intact. It it focusing ahead on your goals while not ignoring what is happening on the sides. Know where you are going, but don’t discount the changes in your markets, the economy, or your competition, or you risk being blindsided.
7. Use outside advisors.
Successful, growing businesses engage with an outside board of advisors. It is not hard to find people that are willing to help you grow your business—often without payment—just by asking. Make sure you recruit people to your board who are willing to tell you what you need to hear, not what you want to hear, and have the expertise and experience that you do not.
Note that nowhere in the above list did I say that you had to have the best product or service on the market. While having a good product or service is necessary, it is not sufficient. If customers do not perceive your goods to be of value, or if they have never heard of you, it doesn’t matter how incredble what you do is. If not enough people are buying or you don’t have enough cash to pay bills, your company will never be able to reach that Magic $Million Mark.
Julie Lenzer Kirk is an award-winning entrepreneur and mother of two. She is the founder of Path Forward International, which offers workshops, consulting, and keynotes to give entrepreneurial companies and individuals a “Boot in the Butt™” to launch new ideas, grow existing ventures, find their work/life balance, and fine-tune their entrepreneurial leadership skills. Her book The ParentPreneur Edge: What Parenting Teaches About Building a Successful Business (John Wiley & Sons) came out in June 2007. You can subscribe to her monthly “Boot in the Butt™” newsletter through her Web site at www.JulieLenzerKirk.com.