A few weeks ago, I was talking with my twelve-year-old daughter Claire. Wow, where has the time gone. Claire is a fun-loving girl who is utterly fascinated with Legos.
And now the middle-age dad comes out of me as I am baffled by the price of a Lego Set now. I don’t even want to think about how much money I’ve handed over to the Danish giant toy maker.
Claire’s fascination with Legos began a few years ago on Christmas when I was trying to figure out a gift that Claire would enjoy. I remembered how much I enjoyed Legos and made an educated guess that she would enjoy them.
Little did I know. Claire has gone absolutely bonkers for Legos. She still has every single box of every Lego set she has received.
I have a tradition in my family to take each of my child on a special trip. In order to earn the trip, Claire had to save $100. She scrimped and figured out a way to earn some money here and there. Then the fateful day when she ran to me with glee and shouted out the words, “I’ve saved up my $100!!”
“Excellent,” I replied. “Where would you like to go on your trip? “
“Legoland!!!” she blurted out.
“Alrighty then, let’s plan out our trip and figure out when we’ll make the trek.”
We had a fabulous time as we stayed in the Legoland hotel. Legoland was sparsely populated the two days we were there, and we got to remain on Coastersaurus roller coaster eight times in a row. We didn’t even have to leave the seats of the Coastersaurus. One more time, we both excitedly chanted.
As we were leaving Legoland that day, we stopped in one of the stores so I could empty my wallet in exchange for a bunch of new Lego sets.
As Claire and I were walking back to the Legoland hotel, I asked Claire a question.
“Do you know why we took this trip?”
“Yes, because I saved $100.” She replied.
“That’s part of the reason we came here. However, there is a more important reason. I want you to realize that if you’re willing to work and use your money wisely, you can get what you want out of life. When I was growing up, my parents used to tell me they didn’t have money. I hated that response and knew that I wanted to raise my children differently. There’s plenty of money out there. You just have to do the right things to get the money.”
I’ve learned that questions tend to provoke the best thinking. Running a business requires new thinking and problem-solving. As I’ve pondered the value of questions, I’ve compiled a list of vital questions every business owner should ask.
Question 1 – How much money do you want to make personally?
One of the biggest mistakes most business owners make is never figuring out how much money they want to make. Without the answer to this question, they are like a passenger in a rowboat without oars in the midst of a hurricane that is quickly coming to engulf them.
Business ownership can become an all-consuming endeavor. It’s fun. You’re helping people. You’re making money. If your service or product is good, you’ll get referrals, and your business grows. Then you run out of time. You work night and day to keep up, but the work keeps coming in. Then you invest in people and equipment to handle the demand. Your profits sink, and the scramble begins.
Some people would be much better off in life if they just made $150,000. They could have a good lifestyle, save money each year, and have a decent work-life balance. But they don’t get to enjoy the good life for their business because they never took the time to figure out what amount of money would make them happy.
You can read further about how to calculate your personal money by reading my article How much money do you want to make personally?
Question 2 – What industry do you want to serve?
One of the biggest regrets I have in my business is not figuring out what industry I wanted to serve. Consequently, in my efforts to scratch out a living, I took any customer I could get. Every business customer I obtained was different, so I had to have different processes and systems for each customer. I became a Jack of all Trades in Business and a Master of None.
A year ago, I made the decision to focus all my new customer acquisition efforts on Residential Realtors. I was astounded at the difference this one decision has made in my business. There is a perfect word to describe the change that came about by choosing to work with just Residential Realtors.
Everything became so much simpler. I realized I was spending money to be part of different organizations. With my newfound clarity, it was an easy decision to cut that expense. I was spread too thin. Unfocused and spread out all over the place.
Now with my new industry focus, I’ve made investments in getting to know the pain points of the industry. This has lead me to developing new solutions to help Residential Realtors. I’ve attended Residential Realtor trainings so I can learn more about how they work and how they think. I now know how to speak their language.
Question 3 – Who is your ideal customer?
With over twenty years of business experience, I’ve had my share of excellent customer relationships. I meet up with one of my ideal customers and my heart leaps, and it’s a joy to talk with them
I’ve also had my share Pain in the Rear customers. The cringe factor envelopes me even still when I think about them. Those people are the ones who I gave the most to, and then they stomped it on the ground and spat all over in disgust. It’s sickening to pour your heart into someone and not have it appreciated.
Now I look at the customers I love, and I look at the customers I loathed. The attributes of both customers are very important. It’s just as important for me to know what a good customer is and what a bad customer is. I don’t need every customer. I need my customers. The matches that are made in heaven. I don’t have enough time in my life to spend it with people that don’t appreciate me who would be better off working with someone else.
Question 4 – What makes your business unique?
I remember the nativity I had when I first started my public accounting practice so many years ago. I thought the magic trick was just to hang out a shingle and then I would have customers flock to me.
It was a terribly rude awakening when all I heard was crickets.
I had to toil away to make a name for myself so that I could attract customers. I had to build relationships so people would trust me.
As I was going through this process, I remember someone commenting to me.
“Damon, the world doesn’t need another accountant. There are already plenty of accountants out there. You have to be doing something special. You have to be unique. You must be providing value to the marketplace that isn’t currently there. If you’re not going to be different, don’t even set up shop.”
Question 5 – What is your exit plan?
I’ve asked this question to hundreds of business owners. I can count on one hand the number of people who had had a well thought out answer to their exit plan.
Most people hem and hah and say I don’t know. This reminds me of my favorite scene from Alice in Wonderland. Alice comes to a fork in the road and sees the Cheshire Cat in the tree.
Alice asks the Cheshire Cat, “What road should I take?”
The Cheshire Cat replies, “Where do you want to go?”
“I don’t know?” says Alice.
“Then it doesn’t really matter which road you take.”
If you don’t have an exit plan, you’re doomed to be tossed around by the winds of change. Your exit plan sets the goal for how you should build your business.
Not having an exit plan is akin to the general contractor showing up at the job site and randomly placing bricks all over the ground.
The questions you ask yourself about your business will be the most important thing you can do in your business. Thinking is hard. It’s hard to look in yourself and ask questions about what you want. I believe the biggest reasons people don’t get what they want from their business is because they don’t take the time to ask themselves the right questions
Take some time to ask yourself the Five Questions I’ve introduced you to in this article. The answers you get will provide you with a wealth of knowledge about how you should build your business. The questions will bring clarity to your business.
Business isn’t as difficult as most people make it out to be. You will be amazed at how much simpler your life and business becomes when you take the time to think through the Five Questions. Your real answers to the Five Questions will launch you in the right direction.