5 Steps to Finding the Sweet Spot for Business Success
Business owners almost always have a clear idea of what success will look like but converting a vision into reality and achieving a set of goals is a lot harder than establishing them.
When goals are missed, there is a tendency to spend a lot of time obsessing over what has gone wrong.
Sometimes, however, the better question is: what is going right?
Focusing on the strategies that are producing the results you want is often a better way to zero in on the sweet spot—the place where your efforts will have the greatest results and put you on a path to business success.
How do you find it? Your sweet spot lies at the intersection of what your business does well and what the market is willing to pay for it.
Finding your sweet spot allows you to operate with efficiency, strength and – with a solid understanding of your cash flow and how to use it – profitability. Unfortunately, many companies struggle to find or leverage their sweet spot. If you haven’t found yours, now is the time to start looking. Here are five ways to get started:
1. Cultivate your core competencies
Finding your sweet spot is an inside job. It’s not about trying to add to what you have; it’s about leveraging existing core competencies. Your business has made it this far, which means you have valuable competencies you can leverage for further growth.
2. Capitalize on your strengths
Making a list of what your company does well and profitably is a great way to hone in on your sweet spot. Analyze your financials to determine the most profitable solutions. Then match up your strongest categories with market demand. While you may have a favorite product or service to sell, the market may not support building an empire around it.
3. Listen to your fans
Do your customers rave about how your product saves them a boatload of money, how your construction quality is second to none, or how you’ve become a trusted advisor for them?
Listen to why people praise your business. Chances are, these customer shout-outs are at the center of your sweet spot.
4. Start seeing your sweet spot
Now that you’ve identified your core competencies, strengths and what your fans are saying, you can put them all together to start seeing where your sweet spot lies and what you can do with it.
5. Understand your cash flow
Cash flow is about a lot more than what’s in your bank balance today vs. what was there yesterday. Understanding cash flow is the key to nimble decision making and the ability to seize opportunities. Your bank account won’t tell you that you may be short $100,000 3-6 months from now or that you will have enough to hire new employees.
Genuine cash flow visibility comes from being able to forecast, with projections that let you know whether you’ll be in a position to hire, purchase new equipment, acquire a company, open new locations, or any of the other things that can get you closer to your goals.
Do You Need Help?
If your path to business success is taking too long or is unclear, it’s time to identify your sweet spot: the place where your solutions and the market price come together in harmony – and profits. It’s a strategy proven to be well worth the effort.
Without a financial background, however, it can be hard to go it alone. If you need help visualizing your cash flow, understanding what’s on your balance sheet, or determining if your tax structure is optimized, contact us for an Accounting Advisory Analysis. Invest some time with us and start getting the answers and guidance you need to take advantage of your sweet spot.