Why Reviewing and Acting = Dollar$
People often think that there is no real value in spending time to review the past. We have been told over and over to review our business plan, our project outcomes, our past year, but what is the dollar value or does it even have one? Let’s look at one example of how we get investment for our business and how reviewing your past performance can affect your current and future income.
Of course it is not all about the review, it is what you do with the knowledge you gain from the review that really increases your chances of being successful.
Money coming into your business is how you can continue to grow and invest in new ideas, markets, clients, etc. Without money coming in you cannot continue to increase your business income. As an example I want to talk about a company run by two ladies that does not do a review after each event they put on and with the happenstance information they get from the outcome of their events they do not act. What does it mean for their bottom line?
I do not want to elaborate on who they are to protect their current business but I will give you some insight into what they have lost in business and in credibility. These two people are well liked in their community. So much so that when they have gone to well-known, local business owners to get support for their business they have been greeted with support. Once they were loaned the money they needed to put the deposit down on their event. As the money came in from the customers of that event they would put that money into their business, but not onto the loan. They were living dollar-to-dollar in their business. Each dollar received was already spoken for somewhere else in their business.
Many people just starting their business have this issue, but how do you grow your business if you cannot invest in the growth, if you are always in debt for the past ideas?
They have come to realize that to grow their business they have to do more marketing for the event and investing in the content of the event. Again, they went to their trusted sources and raised money through sponsorships – a great idea, but forgot to market the sponsors. Raising money again this way will be much more difficult in the future without a plan to provide significant marketing for their event and the sponsors.
So, if you want investment in your business what do you have to do and how do you provide it?
If you have been in business only a short time you are going to likely require collateral and for large sums of money you will need a business plan showing the research, review, and actions you plan on taking to increase your business significantly, so that you not only can repay the bank but you can also put money into your business and pay yourself.
If you have been in business for a few years you may be able to get a small line of credit on your business account. But you will have to show past income to get this.
The bank wants to be sure they are going to get their money back with interest.
Outside Investment Money
Outside investors have different motives for investing in your company. For large investments you will definitely require a business plan with the information on how you will make your money and how you will pay them back. Angel investors are looking for their money back while Venture Capitalist may be looking at how they can own part or all the business.
You have to know what you have done and what you will do to be able to come up with this plan.
You have been investing in your business since day 1. You must look at your accomplishments to see what you have done to get you this far. If you were an outsider, what qualities and skills would you point to as those things you brought to the business? What have you done to create a significant business value? Remember, you will be putting a lot of time into your business, plus your own money and not to mention the cost of what you have had to give up to make your business work. Would you invest in you?
By reviewing your past achievements you can more easily show people how you have made money and how you can pay back their investment in you.
Review Outcomes and Actions
Back to the example company: Here are a few things they can do to see their event make more money every time they run it. You can use these ideas for your own business growth as well.
- Review the numbers from the event.
- Pull out the most valuable pieces of the event to the customers. (e.g. 50% of people were satisfied with the event location, 80% loved the content, 30% were happy with the schedule, etc.)
- Evaluate the costs and income of the event and ask yourself, “am I making money?” Remember to take into account the amount of time you have to put into preparing.
- Create more interest.
- Look for the things that generated interest and excitement and create your new marketing material around this information.
- Start with the end – the event date and work backwards
- What do you have to do to start generating interest?
- What new markets are you going to reach out to and how?
- What do you have to create (marketing collateral, new branding images, copy content, etc.) and who will do it?
- What are your regular marketing touchpoints and when will they be implemented?
- How much money are you going to need to do this marketing successfully?
Related Link – “How to Plan the Marketing for Your Upcoming Event“
- Sometimes the challenge is that the things we need to do to grow our business, we cannot do successfully because it is not our core competency or it is not our passion. Can you do this work and will you do it?
- If you find you do not want to invest in this required business component of your event then find someone to partner with that will do the work. Create an alliance so you can make money, your clients will have the best experience possible, and your investors will get paid (whether through sponsorship marketing, loan payment, or business value).
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