So you’re a business owner. Is it everything you thought it would be? I talk to a lot of business owners, but I try not to talk business with these folks. So much of their lives are wrapped up in it, I just try to be a different voice. Normally it creeps in sooner or later and lately the subject has been how life seems to be eroding away. By that I mean they complain that although their business is growing, their life separate from the business is getting smaller. The business is completely absorbing them. They’re selling more, the business is growing but life is getting worse. WHY IS THAT!?
Let me first say, this is NOT due to people regretting their life’s decision to own a business or to work to make it successful. Most owners I meet love their businesses. This is, however, about subtle erosion. For many owners it began around the turn of the century and for some, it accelerated during the 2008 downturn. The top line did and continues to advance and they are forced to put in more time, deal with more headaches and in general, do more to make the business run.
Shouldn’t this be the opposite? Did you imagine when you started that the business would accelerate and life would get better? Did you think when the business reached $1 million, things would be easier because “I’ll have hired someone?” At $10 million did you think you would have another leader around? And when you reach $100 million do you think you will have a great first tier leadership group? … How’s that coming along? Not on track at $1 or $10 million? Why is that?
I don’t have an answer that is true for everyone, but many otherwise great companies and owners are suffering like this because their businesses are actually getting weaker as they grow. How can this be, you ask? If the company is growing in sales, how can it be getting weaker? Often because margins are getting squeezed over time in a slow, subtle process that is not fast enough to be alarming. Or maybe it is alarming and recovery efforts are undertaken, but the recovery is partial – leaving the company better than its worst position, but not nearly at its best.
Weak or eroding margins can be the result of many factors. Unfortunately, at this time in history, many of these factors are active at once. Here are some examples:
Are you seeing the same thing? Are any of these issues applicable to you and your business? On the other hand, do you think I’m wrong? If so, challenge me.