I used to own a national magazine for 20 years called DANCING USA, started it in 1980. After buying several rental properties, I decided it was time to sell the magazine.
I prepared a prospectus as I was marketing the magazine for sale– incidentally – that business plan was more detailed than what I’d operated with over the years. It was full of all the information on the market, how to grow the business and up to date financials along with forecasts for the next five years. In order to find a buyer, I had to show what was possible with the business and how someone could make money. No different than if you are wholesaling a house or planning a rehab.
Eventually, I did sell the magazine to a man from Iowa. One thing about publishing…it operates on a tight formula, like most businesses. In fact, 1 in 3 magazines go out of business in the first year. They are capital intense projects.
After purchasing the magazine, what happened was not great. He changed the formula, the precise method that had kept me in business for over 20 years. His dire mistake was to spend money on web marketing. This was ahead of it’s time as the bulk of the readers of a big band, ballroom dancing magazine were senior citizens and were not tech savvy in the year 2000. It caused him to go out of business in a few years. Today…life is different and a web marketing strategy would be effective, seniors have in fact embraced technology but it is 16 years later. It’s all about timing and knowing your market.
Each year at tax time it forces those who aren’t up to date to finally reconcile the past years business dealings. It’s too late to make changes – its past. These are the slow reacting businesses.
TRACKING TIPS For Your Business
Knowledge Is Power
Especially when it comes to knowing where the money is flowing…or not. Without a budget, income projections or knowledge of your expenses, how will you know if at months end the bills can be paid or if you are turning a profit? Without projections, how will you know you need to call 25 people each week to meet the sales goals?
Patterns are Predictable
When reviewing the past, patterns emerge. This is one of the fascinating things about history. Real estate is known to sell better in the spring market than in the dead of winter. Imagine what you could do with predictions based on tracking that helped you plan ahead for ebbs and tides?
Timing is crucial
When accurate accounting records are up to date, then business decisions can be made BEFORE the trouble begins, growth can be forecast and timing can be adjusted. Think of the developers who put projects on hold during the downturn. These projects are now being built as the timing is right and demand has improved. The developers who tried to barrel through are most likely those that went out of business.
Know Your Market.
Technology, marketing methods, availability, pricing, and tons of other factors affect your product or business. In real estate for example, the cost of a property to fix and flip here in Minneapolis has gone up. Some have adjusted by moving to the over $200,000 houses in further out suburbs, a market shift. Others have moved their teams to markets in other cities where their original formula still works well.
Adjust – Trim The Sails
It’s much easier when you hear the news of an impending storm and adjust the sails. Keep abreast of the trends, it simple and easy today with the internet. Look outside of your local market and see what is happening in your same industry elsewhere. There are many ideas you could implement that could increase your business or shift your model.