Leveling Up Your Business Game: Proactive Strategies
“Do you know anything about Mr. Penny — that tiny, little brown guy ?” When I shook my head no, as in confused, he explained, “The point is, he matters. Be sure to take real good care not to lose him, because there are 99 others like him that make up a dollar.”
Continuing our discussions on the series about building a successful and solid business that innovates and thrives. Last week, I talked about my mentor advising that a success mindset and mentality are key to winning at The Game of Business. Now, I want to reflect on proactivity.
Become Proactive at the Game
I deliberately did not go into all the initial preambles involved in starting a business at the start of this series. I think there is so much information about it all out there, namely: come up with an idea for a business, draw up a business plan, incorporate, get an EIN, get a business email and phone, create a social media page and a website, use AI to gain valuable insights or APECRRA and all that yada yada yada. There is even a free business start up checklist on our website blog. Access it under tips.
That’s information easily accessed out there by anyone, as I indicated. However, does all that information translate into anything quantifiable or empirical as a marker for being innovative and successful? Regardless of how readily small business start up information can be accessed and businesses established, a large percentage of businesses still fail within the first couple of years.
That’s my point. What are the often overlooked things that could make the difference between a win and a loss/ fail in business? That’s what this series is about. The obscure nuances that make or break outcomes or output.
So now, I’ll move beyond mindset and mentality and on to being proactive or pragmatic. Either word could work but I prefer proactivity at the game because of the nuances involved in being proactive versus simply being pragmatic. Be proactive to win.
Identify Potential Risks…Proactively.
Still going off the blood sport/shark in the water theory or being a mamba, I learned to identify potential risks and understand how they could impact my business. That became a crucial first step in proactive risk management. Here’s what I mean. With risks, first things first.
Safeguard Your Investment…Proactively.
The primary goal for most businesses is to safeguard their initial investment and make a profit. I vividly recall the advice my mentor gave me early in my career, which resonates with me to this day.
He said, “Judi, your first assignment is ‘don’t lose the money.’” At first, I thought, “Of course not. Why would I lose it? I want to make more.”
But then he asked, “Do you know anything about Mr. Penny — that tiny, little brown guy ?” When I shook my head no, as in confused, he explained, “The point is, he matters. Be sure to take real good care not to lose him, because there are 99 others like him that make up a dollar. And the way you protect and take care of them all will determine how many more of them you can eventually hoard.”
At the time, it sounded as strange-silly to me as it may to you now. But I understood his message: I had to “gird” the finances — carefully protect and manage them. This lesson has stuck with me throughout my journey in business.
Mitigate Risks….Proactively.
Financial risks must be mitigated as they encompass factors that can impact a business’s financial health and stability, such as cash flow issues, unexpected expenses, or changes in interest rates.
Examples and Strategies:
- Cash Flow Issues: To avoid cash flow problems, always maintain a buffer in your business account and regularly review your cash flow statements. Implementing an invoicing system that ensures timely payments can also help. There are so many ways these can be done that help you stay solvent. Putting a net 60, 90, 120, etc. plan in place from the onset of a business is an easy proactive strategy that a lot of new business owners don’t know about, as an example.
- Unexpected Expenses: Set aside a contingency fund to cover unexpected costs like equipment repairs or sudden increases in raw material prices. Proactively sourcing what SBA loans and county assistance programs are out there and applying for them in advance is a great strategy, for example. Building business credit on Dun & Bradstreet(D&B) is another example.
- Interest Rate Changes: If your business relies on loans, proactively stay informed about interest rate trends and consider locking in fixed-rate loans to protect against rate hikes. Here’s another example where one should think like a shark and not bleed in the water. It means don’t weaken yourself and become prey in a blood sport.
Identify Market Risks…Proactively
Here’s another area where the blood sport analogy comes into play. Thinking like a shark requires mastering market dynamics. Market risks stem from changes in demand, competition, or the regulatory environment.
Examples and Strategies:
- Shifts in Consumer Preferences: If consumers start buying products that are new to your market, like suit shirts without skirts or Juvederm instead of lotions, investigate the cause. Is it because they’re spending more time on video calls? Adapt and innovate proactively by offering products that meet the new demand.
To be continued…stay tuned for more insights and practical advice.
As we continue this series on establishing and growing your business, follow our weekly updates to dive deeper into each aspect of building a successful business mindset, identifying risks, opportunities, building resilience and more. Visit our website at https://mommentisconsultants.com to learn more about our services and how we can help you achieve your business goals.
Now, before I get out of your hair with my blurb, here’s a question for you –just because I’m a lifelong student who’s always seeking to learn. 😊 Have you encountered any unexpected risks in your business that caught you off guard? How did you handle them, and what did you learn from the experience? Share your thoughts in the comments below!
Written by Judi Snell.
