Why Most Small Businesses Never Grow

Red Bull gives you wings.

So does a good business structure! Most business owners seem to start up a business, as a means to making money. And while that's not the most ideal goal to have, profits are the fuel that drive the business.

So how do you create a structure that maximises leverage and increases profits?

Let's chunk up the business into three distinct categories

1) Creation
2) Production
3) Distribution

What's creation all about:

If you're running a consultancy/information based business, the core of your business is to keep coming ideas that can be turned into systems or products. If you're in a product based business (example: Ipod), you still have to come up with nifty ideas to create a product that gets the customer's attention.

What's production all about:

Why it's all about putting the darn thing together. Writing, producing, making the product or delivering the serivce, is what it's all about.

What's distribution all about:

Again, painfully obvious, isn't it? You need to get all the stuff you've thought up and produced, and put it in the hands of as many customers as possible.

So why am I boring you with the obvious?

Because what you're looking at are three full time jobs. And as a small business, the more you juggle all three of these core functions, the more you end up making a reasonable hash of it all.

How not to hash it

Look around you at businesses that are reasonably successful, and you'll find that they don't do it all. Yes, indeed, you can fly solo by running certain specialist types of businesses, but after a while, your growth will be pretty stagnant. Hey, I'm not talking about you turning into a Google or Microsoft. I'm talking about a tiny itty-bitty enterprise, that will generate $150-200K a year, and give you at least 2 months off in a year, with a lot of free coffee time thrown in as well.

You may want to stick to flying solo

And it's your choice. You can either grow your business smartly using creation, production and distribution–And get wings.

Or just drink a lot of Red Bull (pun intended)

Personal Experience:

The hardest thing for me was to let go. To hand over some of my tasks to some one else. It's harder still to have to trust an employee or an external supplier to do what you were doing. Plus you never have the budget to pay the salaries. But over time, you'll realise (as I did) that you're looping.

For your brain to succeed, it needs to have large slices of rest.
And if you try to do all the creation, production and distribution, all you end up doing is getting severely exhausted. If you're in a small business, here's what I'd advise you to do. Phase an employee in. Get someone working for you part-time.

Then as you do more creation, get them to do more production work, finally moving the employee to a full-time status. The sooner you are a trio: One working on creation, the other on production and the third on distribution, is the moment your business will really start to gain some altitude.

It's honest advice. And sound advice. Give yourself a deadline…say…12 months from now. And work towards the goal of creating three distinct categories in your business. You won't regret it for a minute. We haven't. 😉

And I'm sure, neither has Red Bull!

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