Is It Time to Go?

I recently had a conversation with a good friend of mine about having him start a new business. Of course, he was concerned about numerous items – recent events with Ai, continued concerns about inflation and high interest rates.

I suggested that he focus on what he wanted to achieve with his customers and, as the saying goes, not “let the smoke get in your eyes.” While the recent concerns about Ai are relevant, I cannot let that stop me from moving forward with my life and neither can you. In fact, the advent of Ai will likely assist many businesses to streamline their operations and become more efficient. Recent Ai events were probably a “wake up call” for the U.S. tech industry…

Now, regarding inflation and its effect on the Federal Reserve Board raising interest rates to slow down our economy, we have had inflation for a long time. Why do you think the “purchasing power” of the U.S. dollar has decreased so much over the last 50 years?

Instead of worrying about the impact of these forces, I suggested that he spend more time focusing on what he wanted to do for customers. Additionally, consider what he needed to get started. Let’s consider these outside forces and then focus on the positives of what he could offer.

In the book “Start Up Nation” authors Dan Senor and Saul Singer state that “Without start-ups, the average annual net employment growth rate (1980-2005) would actually have been negative. Economist Carl Schramm, president of the Kauffman Foundation, which analyzes entrepreneurial economics, told us that ‘for the United States to survive and continue its economic leadership in the world, we must see entrepreneurship as our central comparative advantage. Nothing else can give us the necessary leverage.’”

So, after shifting my friend’s focus, I suggested he consider the following. If he knew that he could not fail, what would he do? Once identified, that is where he is most likely to succeed.

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“The two most important days in your life are the day you were born and the day you find out why.”

Anonymous

Let’s take your business to the Next Level!

What is Your Mission This Year?

As we begin a new year, I believe it is crucial that we identify what our primary objectives are for the coming 12 months. I understand that the challenges of inflation, higher interest rates and general over-regulation of most industries today have helped to create a sense of malaise.

However, in the words of Greco-Roman Philosopher Epictetus:

“The more we value things outside our control, the less control we have.”

In other words, focusing on these items can create a sense of helplessness. This is a myth. You have more control over your outcomes than you give yourself credit for. While all of these variables can impact your results to some extent, you have the ability to boost your outcome.

You can control your results, and it helps to have a plan. Can you control every step? Of course not, but once you have set your objective, decide what your first step will be.

And isn’t this a great time of year to start outlining your objectives for the year?

Along with your first step, identify the potential challenges you will face and what your response will be to each one. Be sure to get your Team involved as you lay out the plan. Their support will be instrumental to your success.

Then, as you move forward, start to identify each of your next steps and refine your plan accordingly. Ultimately, the combination of your belief and a sound planning process will assist you to “Make It Happen!”

What is the Next Step for you? Please let me know if I can assist you. You can reach me at john@success-strategies.com, and consider the following advice:

“A good plan is like a roadmap: it shows the final destination and usually marks the best way to get there…”

H. Stanley Judd

Let’s take your business to the Next Level!

Are You a Visionary Entrepreneur?

What are the qualities of a Visionary Entrepreneur? This was the leading question asked at my most recent Strategic Coach workshop. It is actually an interesting and thought-provoking question.

Some of the answers that participants offered were “the ability to see future opportunities, an ability to plan the future, and using your imagination to think about the future.” These are all great answers. The Oxford Dictionaries describes visionary as “the ability to think or plan the future with imagination or wisdom.”

As we start a new year, what ideas do you have in mind to dramatically improve your current operation? Are there areas in your current operation that should be boosted? If so, what will be required to achieve this level of improvement? Does it require an investment in people, equipment or other items? Start by listing these necessities and then consider their level of payback. Does the required investment make sense for you?

On the other hand, would you be better off designing a completely new vision for the future? In either case, you need to see it, build it and articulate it to your Team and your Lender. Their feedback and support will prove invaluable to you.

As I have stated many times before, being visionary will require you to:

  • Identify what, specifically, you want to achieve.
  • Develop an outline of how you can best accomplish the desired result.
  • Recognize the potential challenges you will face, and yes, there will be some.
  • Formulate your strategy to overcome these challenges.
  • Move forward with the first step and develop a system to track your progress.
  • Adjust your course, as needed.

All of us are visionary, to some extent. The key to your success is developing your ideas, maintaining a system to measure your results and then adjusting your course as new challenges arise.

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“The only limit to our realization of tomorrow will be our doubts of today.”

Franklin D. Roosevelt

Let’s take your business to the Next Level!

What Does Your Future Hold?

Whenever you stay in business for a long time, the day will arrive when you must consider, for many potentially different reasons, whether you wish to stay in the business or leave.

Many agricultural producers are in this situation today. It could be due to their advancing age, a recent lack of profitability, health concerns, high interest rates or a combination of these variables. The lack of available credit from banks is also putting pressure on producers, as most lenders continue to seek the perfect business to lend money to.

If you are faced with this situation, here is what you should do. Literally, get away and THINK. Your next step is a big decision, so you want to make sure you make a wise, well-informed choice. Despite what your first boss told you when you were 15 years old, it really is not a crime to get away and think…

Consider what you would do: 1.) If money was not a limiting factor. 2.) If you could operate your “dream business.” 3.) If you had all the financing and Family support you desired. Then consider if you possess the health, stamina and desire to move forward with your plan. Saying “Yes” or saying “No” are both acceptable answers. Just be certain that saying “No” isn’t just because you were scared to do so.

In the movie “The Art of Racing in the Rain,” the main character was hesitant to enter a car race, and his driving coach stated: “There is no shame in competing and then losing the race. There is only shame in not entering the race because you were afraid you might lose.” That is excellent advice for all of us.

One final point in considering whether you should stay in your current operation is to look at the tax implications with your Accountant or Tax Adviser. Please do not execute your plan without considering the tax implications, especially if you decide to completely exit your industry. Is it better to go now or after December 31st?

Once you know these implications, you can refine your plan for success. Additionally, if you continue your business, consider this thought. If you knew you could not fail, what is the next action you would take? Recognize that there will be obstacles. That’s why so few people run their own businesses. Overcoming hurdles is not something they want to deal with.

Be sure to set some deadlines for action and move forward. Today is an excellent time to establish your plan for the new year!

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“Let our advance worrying become advance thinking and planning.”

Winston Churchill

Let’s take your business to the Next Level!

What is the Secret to More Positive Cash Flow?

After eight years in the banking industry and 26 years of consulting on finance & strategy with Success Strategies, Inc., I have concluded that achieving positive cash flows in your business revolves around several key items.

First, I absolutely believe that if you measure it, you will understand your cash flow far better. If you understand it, you can manage to get better control over it. Undoubtedly, if you gain better control over it, you will be positioned to improve it. While this set of principles may sound simple, it can be rather evasive at times. Additionally, you are constantly being faced with changing variables or factors that, sometimes, you were not expecting.

Regardless, all success in this arena begins with measuring your cash flow. We have a software tool for the dairy industry called the Success Strategies Advantage™. It will measure your financial results and provide you with a budget that is based upon your region of the country, i.e., the “Averages” of various Revenue sources & Costs per 100 pounds of milk. In a moment, I will explain what other tasks it can fulfill for you.

Second, you must know your Break-Even levels. In other words, what could you change on your multiple Revenues or Costs, while all other variables remain the same, and still not lose money. This is extremely valuable information to have at your fingertips. Why?

Well, if you are losing money, your Break-Even numbers will tell you what you need to change in order to stop losing money. Another approach would be to ask yourself, “What are potential items I can increase (on the Revenue side) or decrease (on the Expense side) to achieve a Break-Even level and, better yet, start making money!

I have had Client situations where we have literally boosted revenue and/or cut their costs $1.00-2.00/cwt, and the program clearly showed us where they were spending too much money, in comparison to other producers in their region of the country. Would that help your operation to be more profitable? Absolutely! It would in most businesses.

Using the program, you can also run some “What If” scenarios to measure the potential impact of adding more cows in your dairy herd, boosting their production per cow or adding new equipment or automation tools that can lead to lower costs. This knowledge can assist you to make better decisions. If you have a more solid grasp of what you are investing in and the potential impact of that item or variable, you can feel more confident about the choices you are making.

Hopefully this overview has been helpful to you. I would urge you to check out the Success Strategies Advantage™ software at www.success-strategies.com and start a free trial. It’s on our Home Page – just look for the Milk Cans.

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“Success… seems to be connected with action. Successful men keep moving. They make mistakes, but they don’t quit.”

Conrad Hilton, Entrepreneur

Let’s take your business to the Next Level!

Are We Getting Too Comfortable?

I recently spoke at the Amelicor Corporation’s Conference in Las Vegas and while I was there, I saw someone win $1,000. I asked him what he would do with his winnings, and he responded that he would probably just gamble it away….

It reminded me of the story about the three lottery winners who were asked what they intended to do with their monetary awards. One said he would buy his parents a new home, because they had been so good to him. The second winner said she would quit working and take a trip around the world. The third one said he would probably just keep farming until he lost it all!

While gambling might be fun for some people, it is no way to run any business. Frankly, you already assume numerous risks every month, including weather risks, health challenges, and rising costs due to inflation. Why be subjected to price risks, too?

If you are running a dairy or other agricultural operation, consider using Put & Call Options to reduce your price risk. As I explained in Las Vegas, the Dairy Revenue Protection program can lower your price risk by putting a “floor” under the prices you receive. If market prices drop, you are covered. If prices stay high, you lose the premium you have paid, but the good news is that you can likely afford it, since your prices were higher.

Sometimes I hear producers complain that they “lost the premiums paid for their price coverage.” However, I remind them it is a form of insurance, price insurance in this case. When their house doesn’t burn down, they certainly don’t call their agent and suggest that “they really didn’t need the fire coverage.”

Of course not. To not be covered would be way too risky. In fact, banks won’t finance a house or business property that is not properly insured. The day may be coming when banks are unwilling to finance your business without sufficient price coverage. The current trends are certainly in that direction.

Please don’t get too comfortable with assuming excessive price risk. Think about it.

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“Successful people don’t control events; they control their response to events.”

Dan Sullivan, Co-Founder of The Strategic Coach

Let’s take your business to the Next Level!

Why Aren’t You Dancing in the Rain?

I recently listened to an excellent, brief video completed by Matthew McConaughey entitled “Motivation.” I found it very uplifting and wanted to share its message with you today.

In his video, he shared six truths that you may find helpful:

  • “Life is 100% better when people know less about you.” At first, I thought he may have shared this, following the intrusions of the public life that he has led. However, the more I thought about it, the more I felt this may be true for all of us in business. When we consider the amount of information demanded of us today, from banks & the government, the reporting can seem overwhelming. Thus, I recommend you give them everything they need but limit it to just that.
  • “Never take advice from those who are not where you want to be in life.” Instead, determine your goals, recognize the hurdles, set your standards, outline your steps, take action and don’t necessarily listen to others who say you cannot do that. Often times, they are mistaken.
  • “Eventually, everyone will show you who they are. Just give them time.” I learned this recently when a bank offered a loan proposal to a Client of mine and then reneged on the offer two weeks later.
  • “Be smart enough to create your own opportunities in life.” Don’t wait for them to come to you. Go out and create them yourself. People value ingenuity, and there are items that only you can provide to the world! Lay out your plan & take positive action.
  • “The secret to happiness is freedom. The secret to freedom is courage.” You must act. Remember, no statue was ever erected to an “observer.” They are only built for people who take decisive action. Recognize your role, build a plan & go forward!
  • “We will always have some conflict in our lives.” Learn to deal with it and adjust your perception. As the Boy Scouts of America advise: “Improvise, adapt & overcome.” As Matthew McConaughey states, “You can either cry in the storm or dance in the rain.”

What is next for you?

Please let me know if I can help you. You can reach me at john@success-strategies.com.

Let’s take your business to the Next Level!

What Is Your Next Step?

I recently completed a Keynote Address at the Amelicor Corporation’s DHIA Conference in Las Vegas entitled “The Three Pillars of Financial Success.” It was a great conference.

In my presentation, I reviewed what I feel are the three most essential items to your business success as you move forward:

  • Protect the Balance Sheet – Our primary objective here is to build your Working Capital (Current Assets – Current Liabilities). This can give you lots of options, since it means you have or will have cash on hand. Further, if your Loan to Value %’s are in line (65% Herd Loan, < 100% on your Feed Line & no more than 65% LTV on your Real Estate Loans), you have opportunities, if needed, to restructure your debt obligations.
  • Build Your Banking Relationship – Finding and keeping a strong banking team around you is getting more & more difficult. The best way to do this is to maintain the same banker, and sometimes the best way to achieve this is by making his or her job easier. How can you do this? Provide them with monthly inventories, which is not that difficult if you are using feed programs like Easy Feed, Feed Watch or the many others available to you. Just complete a physical count 2X per year to ensure that your numbers are accurate. Also, share your Year-to-Date monthly Cash Flows with the bank & then verify your results with CPA Prepared Financial Statements to let them know how you are doing and to assist them when you need some help.
  • Guard Your Cash Flow – Why would you want to do this? Let me give you five good reasons. First, you will feel more in control, which is far better than feeling out of control… Second, if you measure it, you will understand it. If you understand it, you can control it better, and if you can control it, you can improve it. Third, if you take this seriously, you will get enthused and start to think “Why ever have a negative cash flow?” Fourth, you can discuss these results with your Team and evaluate what you can do to make results even better, because they want you to succeed. Finally, you can discuss this with your vendors. They, too, want you to succeed. In fact, they need you to succeed.

So, what is next for you?

Do you want to expand your operation? You will need all three of these items to acquire the financing you need. Are you positioning yourself for a sale? Focus on the first one, strengthening your Balance Sheet. Would you like to hold and simply boost your efficiencies? Look at all three pillars and decide what steps you should take to make the improvements you want, going forward.

Regardless of your choice, all three pillars can make the difference between reaching you objectives or falling short of your goal.

What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

“There ought to be ways of reforming a business, other than by merely putting more money into it.”

Winston Churchill

Let’s take your business to the Next Level!

Are You Facing Adversity?

Lots of people are facing challenges today. Some of these are financial, and some are managerial. They are asking what they can do & why things do not work – they used to. The challenges of these times are not for the faint of heart.

However, it is time to grasp reality and realize that we are not going back to the “old normal…” On the contrary, things are changing so fast, especially with the recent introduction of Ai, we must learn to respond & act more quickly. As I recall when I became a green belt in Taekwondo in the early 1980’s and started training with black belts, my instructor yelled, “Mr. Ellsworth, you are in with the big boys now. You must kick faster!”

It turned out that this was good advice. The same applies to us today. There is no time to meander. As they said in Alice in Wonderland, “If you don’t know where you are going, any road will get you there.” However, you are better than that. You do know where you want to go. You must simply define it.

Determine what your desired destination will be, because the prize ultimately goes to “the decided.” Take the following steps:

  • Define your goal clearly in your mind & write it down.
  • Now the fun begins – you will face obstacles. My Business Coach Dan Sullivan says these are the raw material for your success. Identify them and discuss them with your Team.
  • Determine how you can overcome them. Again, outline these steps with your Team.
  • Establish dates for their completion.
  • Go forward, adjust course if necessary & win!

If you need assistance, you can reach me at john@success-strategies.com, and consider the following advice:

“Keeping a little ahead of conditions is one of the secrets of business…”

Charles M. Schwab

Let’s take your business to the Next Level!

How Can I Decide?

Ah, the art of decision making. It can be a genuine challenge today for several reasons. Sometimes, we have too much information. Often, we are afraid we might make a mistake (Oh, heavens…). In both cases, we can simply become overwhelmed and keep people from making much-needed decisions.

Here is my suggestion to you: Don’t delay! Realize that you have 9-10 other decisions to make today, and there will be more tomorrow. Having stated that fact, here is a process I like to use:

  • Determine the objective, i.e. where do I want to go?
  • Identify the challenges as much as possible.
  • How can I overcome these hurdles, knowing what we know today?
  • Consider what the best & worst outcomes could potentially be & can you live with them?
  • Choose your best option and “pull the trigger.”

Realize, of course, that none of us gets every decision correct, but as I said previously, you probably have 9-10 other decisions to make today. Deferring action to another day can often have other implications. Please allow me to share an example with you.

Six months ago, I had a dairy client who was completing an expansion of his operation. He had just added another free stall barn and needed to buy more cows to complete his growth process. Young cows were then $2,000 each, and he said “That’s ridiculous. I could have bought those last year for $1,500. I think I will wait.” Fast forward six months, and they are now at least $3,000, if you can even find any to buy… In hindsight, he could have bought them for $2,000 per head and then sold their calves for $600 each, netting his cost at $1,400 apiece, essentially less than ½ of today’s cost. He would also now be selling their milk at $22-23/cwt, rather than being short on his overall milk sales.

This is just one simple example, but it is a good one to illustrate why we cannot delay decisions. Everything keeps moving at such a rapid pace. How do you decide? Look at your goal, consider potential challenges, select what you believe is the best option (based on some market research, not just your neighbor’s opinion), and then pull the trigger!

Ultimately, have a plan, study your options and make it happen. No one ever built a statue for anyone who didn’t take action! What is the Next Step for you? Please let me know if I can help you. You can reach me at john@success-strategies.com, and consider the following advice:

” Let’s go invent tomorrow rather than worrying about what happened yesterday.”

Steve Jobs, Apple Co-Founder

Let’s take your business to the Next Level!