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Every business can stagnate or stall at some point in its lifecycle. Businesses that have been trading for some time often get stuck on a treadmill racing to keep up with competitors whilst experiencing declining sales, profits and business opportunities.

Often business owners feel like they are working hard pounding the treadmill but are not getting anywhere with their once thriving businesses. If this is the case, it’s time to re-evaluate, dismantle and revive your business to get it moving again – re launch! It’s about doing things differently.

Symptoms of a stagnating business

Recently a London based creative company came to CMC by recommendation, with many of the features of a business in need of a kick start:

• Flat sales
• Not generating enough profit
• Increasing overheads
• Lack of working capital
• Over worked owner

This list could apply to many businesses and may include other symptoms to, such as:

• Worrying cash position
• Loss of customer focus
• Racing to keep up with competitors
• Low employee morale
• Confusion about why things have gone wrong

Step back and re-evaluate

In order to highlight potential opportunities, you need to step back and take a good hard look at your business from a number of perspectives, not just your own. Easier said than done, but it is about your mind set. Your ability to re set and take a different view.

At CMC, we believe that every small business has 5 core functions to review – not as a prescriptive tick list, but as a creative process.

• Strategy – Competitors, pricing structures, margin, good customers/bad customers, gaps in the market, your brand position etc
• Finance & Accounts – Useful management information, managing profit and cash, knowing when to cut overhead and when to increase it, knowing when to invest and when to hold back etc
• Sales & marketing – Sales pipeline, PR, direct sales, branding, web, social media etc
• Process – Informal processes or highly engineered, IT systems, responsibility and accountability etc
• People – HR, recruitment, people development, succession, round pegs in round holes, dealing with square pegs etc

Sometimes just small tweaks to the above elements can have dramatically positive effects. This was the case for our creative client who was experiencing stagnant business sales for 5 years.

After the review it was clear the business owner’s understanding of her financial operations was limited. She was receiving her accounts on a quarterly basis only, as part of the vat return and reconciliation. This prevented her from seeing and more importantly understanding the underlying issues in the business.

The owner was overworked with the day to day work and unable to find the time to drive the business forward. She had dismissed the possibility of hiring staff as she felt it wasn’t financially viable and she didn’t trust people to help her. However, this decision was made without being armed with the vital monthly accounts and so the potential risks couldn’t be assessed correctly. People employed in the past had no idea what was expected and what ‘good looked like’.

Dismantle and kick start

The following actions were made:

• Annual accounts replaced by monthly basic accounts
• Hiring of new staff – part time sales person, book keeper/back office operation staff and 4 freelancers
  • Owner focused on sales & marketing
  • Client profiling with focusing on more profitable clients
  • Pricing strategy to ensure profits on each project
  • Development of web site to showcase creative work
  • Use of social media to tell the story
  • Re-engaging lapsed clients
  • Relationship building with existing clients
  • Highlighting and developing relations with partner organisations
  • Networking to generate new clients
• Training and mentoring her new team
• Developing an operational desk instruction manual for work consistency

A revived business

Within just six months of working with the owner, she felt back on track with a renewed energy and focus to drive her business forward. Within 12 months of the re launch the business sales had doubled.

‘My CMC Business Adviser is a thoroughly approachable consultant armed with practical solutions and tools for giving the small business owner more control over the day to day running of their business.  After just six monthly meetings I have grown in confidence and walked away armed with a selection of tools to maximise my control in the business.  I once more can see the wood for the trees!’  Owner of Business

To find out more about Derek Allen, the author of this article, view his profile here. If this story is similar to your personal and business situation then we would love to hear from you. Call us on 0208 895 6189.