A Little Strategic Thinking Goes a Long Way
A Little strategic thinking goes a long way
Are you working super hard and still not making meaningful headway on improving the profitability or managability of your business? Despite all your best intentions, you might just be focussing on the wrong things. What should you focus on? Where do you start?
At Jigsaw, we believe that a little strategic thinking goes a long way.
A few years ago, I worked with a small town, family-owned music store. They sold instruments and provided lessons, not unlike many other music stores out there. A business shock happened when a well-known big music chain opened a store in their town. Sales declined and they needed guidance to keep their business viable.
Like many business owners I’ve worked with, they wanted to talk about solutions right away. My role was to slow them down so we could uncover the root cause of the problem to give future actions a chance of success.
One of the first things we discussed was the purpose (the 'WHY') of their business, which the owners were very quick to provide:
“We provide big city pricing in small town BC.”
When I asked if price was the only reason their customers bought from them, the true purpose of their business started to emerge. The customers came back because they felt welcome in the store. The sales staff knew their names and always had time to talk about music with them and their latest gig or musical accomplishment. As successfully commercial musicians themselves, they were always happy to teach the customers something new, to inspire them and to give them a peek into the world of a ‘rock star’.
After a brief conversation, their real purpose emerged:
“We help people to realize their musical dreams.”
A light bulb went on for them and they quickly realized that their cost cutting-focussed plans were steering them in the wrong direction. With new competition in town, they were losing sales because they could not effectively compete on price against them. They were cutting their margins so dramatically that they needed big city volume to make a profit. They started applying pressure on everyone who visited the store to buy. They were eroding everything their customers found special about their store.
With clarity around their business purpose, they easily and clearly saw that they were on the wrong path and plans changed dramatically. Workshops and jam sessions with well-known musicians were introduced into the schedule and a space was made available for drop-in jamming. When the economy soured, they started a trade-in program so cash-strapped musicians could continue to advance their musical dreams by upgrading their gear affordably. They stopped the heavy sales tactics and customer loyalty increased and revenues started to climb.
Together we built a roadmap to help them grow their business with their purpose in mind. We got everyone on the same page and assigned tasks and timeframes to achieve their new goals. Progress was measured at weekly meetings and they remained nimble, pivoting when necessary but always aligned with their purpose.
They turned their business around and subsequently started working with local schools to get kids introduced to music and to stoke their musical dreams as well.
Most small businesses struggle to clearly explain why they exist beyond selling products or services. They are consumed by the day to day grind of operating the business. The clarity that comes from identifying your business purpose will guide your decision making and put you on a better path.
Ready to get off the treadmill and build a more resilient and profitable business? Contact us for a free 30 minute consultation, sign up for a coaching package or join one our other programs.