Over time, as a catering business grows, it can get inefficient. Especially if there is too much money lying around, either in financing or by generating cash flow. Without urgency, a business can suffer.
This is not always the case, especially in larger conglomerates. But even in large multinational companies, at the divisional level, there needs to be a sense of urgency for the enterprise to thrive.
The most efficient place for a business to operate is just above break-even. If your enterprise is thriving above break even, then take the money out of the business and invest it safely for a rainy day, or invest it back in the business. But, please don’t leave excess operating cash in your bank account. Not ever! Too much cash creates complacency in a business.
When complacency sets in, people get tired, stressed and lose their sense of purpose. Many of the behaviors that made you successful in the earlier and hungrier days may disappear. When complacency sets in, it is time for change. And change is hard for everyone.
We all know it is, but when it comes to growing a successful business change is also necessary. In fact, it is essential in order to grow. People, products, markets, customers and processes are dynamic and must change in order to adapt and grow. Nothing stays the same forever and if it does, it can easily lose its relevance.
We have all heard the terms before. Reorganize, downsize and streamline are all words that are common in business and is part of the dynamic and organic nature of an organization. And while these words are often discussed in business matters, they do serve a purpose.
My father used to tell me that every once in awhile, a person needs to get a haircut to grow healthier hair. And even more so, if your hair is getting out of control or wild, “don’t worry, it always grows back,” he said.
If your business is struggling, or if you just can’t seem to meet your budget expectations, I’d recommend a haircut. We’ve all been there, and as hard as it is, your business will grow on the other side of it. Take your catering operations down to the most common denominator and go from there.
Reorganize at the executive and divisional level. Downsize your expenses and personnel if necessary and streamline your operational processes. These steps are not easy, but they are important for keeping your business and your people on track.
Within my own organization I am sometimes reminded of my father’s words. And when that happens I quickly look to myself and my teams to make sure complacency hasn’t set in. If it has, we work together to figure out how we got there and how we can move in a more positive direction. And if complacency has yet to take hold, we also work to keep it from setting in. I’ve been in business for more than 30 years and I can attest to the fact that ‘haircuts’ are needed even when we don’t think they are. I can also attest to the fact that I’ve always come out on the other side with a stronger sense of purpose for the business and the teams within it.
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As thе оwnеr оf a business, it iѕ vеrу imроrtаnt for уоu to have a ѕуѕtеm thаt уоu fоllоw to track уоur revenue аnd еxреnѕеѕ, a rоutinе ѕуѕtеm thаt thrоugh which еvеrу trаnѕасtiоn flоwѕ. I like to саll thiѕ the Finаnсiаl Flow Sуѕtеm.
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