Have the business you have dreamt of!​

This is the obvious of course. When the business is going downhill, we try everything to drive it back to a good direction.

However, the common opinion about hiring a consultant at that point is: “I can’t afford a consultant now, that the business is not making money”.

So you try to solve internally what was broken internally. With the same people who broke it or witnessed it get broken with little or no intervention. You try to go through the crisis with the same ideas, same policies that drove you to that point in the first place.

There is quote online that “the definition of insanity is doing the same thing yet expecting different results.” Although it has been attributed to several great minds, it is actually not known where the quote comes from. Nevertheless, this doesn’t make it less true.

Allow me to put the issue differently: “What costs you more: the money you are losing on the problem or the money you are investing to solve it on the long run (and which will ultimately bring you a return)?”

Hiring a consultant from the outside will shed a different light on the problems, and it doesn’t necessarily cost you a fortune. Having someone who is not emotionally invested in your business look at it from a different perspective can make all the difference in the future. The firefighting you can do by yourself, but keep in mind that you can’t operate in an emergency mode, to put out fires forever. Sooner or later, it’s important to find out what causes them and prevent the problems.

The first reaction of most entrepreneurs or business leaders is: “Why would I hire a consultant, spend more money when everything is OK?” 

My answer to that is: for multiple reasons.

First: doing “ok”, is not doing “great”!

In my 17 years on the filed of business finance I saw on numerous occasions that behind a “good enough” result there is a real possibility that you could have done much better. Behind the “good” is easier to hide or ignore all mistakes that cost you big money.

Secondly, even a good result in the moment can carry great risks for the future if you don’t know your business well enough.

My motto in life in general but specially in finance is: When you are up, know what is it that you are doing good and if that is sustainable for the long run, but also know what you are doing wrong so it will not hurt you in the future.

Do you need to spend less or sell more?

Calculating the fine balance between how much we need to sale and what level we need to keep our costs on can be very difficult. We tend to incline the balance in one direction or the other resulting too much effort for less profit margin or too high unnecessary costs with the same turnover.

Keeping a close eye on this can help you keep your business balanced and your profit stable on the long run.

This applies on all areas of the business. Below some examples:

• Do you have the right balance of your products or services?

For example: Are you selling the products clients are searching for or are you trying to push hard selling products?

• Are your prices working for you or against you?

Wrong pricing can lead to big loss of profits, making an accurate calculation can make the difference between a profitable and a dying business.

• Do you have the right HR structure that satisfies the specific needs of your company?

I have seen a company being shaped to match the employees. This might work on exceptional cases but can be quite dangerous on the long run.