Tag Archive for: Business Success

Are You Being Reasonable?

During my career, I have often been described as “unreasonable” by some Bosses, numerous Bankers, and some of the so called “Industry Experts.” While they might not agree with my approach, it has really served my Clients well, allowing them to try innovative approaches & reach new goals.

As George Bernard Shaw stated:

“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”

I could not agree more. In fact, “trying times” require trying novel approaches. Please remember that today’s greatest inventions were yesterday’s crazy ideas. Some examples include the cell phone, the internet, artificial intelligence & numerous other items.

In order to maximize your results, what changes do you need to consider? I know that there are likely some items or changes you’ve been thinking about making in your business. This may be the most optimal time to implement them. To reduce costs or boost revenues more, what changes do you need to consider today?

These may not even be directly involving you. Here is a procedure I learned from Dan Sullivan of the Strategic Coach organization. “What do you enjoy most? Least? Is there someone in your organization who might thrive with this task that you most dread?

Likewise, can you add equipment, software, or Ai to achieve some tasks? Begin your thinking by following my recently trademarked process that I have used for 25 years. This “SAVE™” process stands for Simplify, Analyze, Visualize & Execute. It has worked extremely well to maintain our focus on what matters most.

In fact, during the past 10 years, our Clients have boosted their Revenues by 32% while limiting their cost increases to 17%, leaving them with considerably improved bottom lines. Additionally, in 27 years, we have not lost any Clients, except to retirement and death (unfortunately).

If you’d like to explore this SAVE™ process for your business, please contact me at john@success-strategies.com and remember:

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

Winston Churchill

Let’s take your business to the Next Level!

Where Are They Now?

During the past 27 years, I have been blessed with the opportunity to work with hundreds of agri-businesses, specifically on their financial progress and, in some cases, their complete turnaround, in terms of how they operate.

Initially, we go through some basic questions about what is currently happening in their business and what they would like to see in 3-5 years. Ninety-five percent of them state that they would like to be more profitable.

I always explain that this will require three steps. We need to know:

1.)   Where are they now? In other words, we examine their profitability and cost structure. This is especially important now, given the recent rate of inflation. Do they have the optimal debt structure in place, one that best serves them well and maximizes overall Cash Flow?

2.)   What items can we change? Are there improvements that are possible regarding costs? If you are shipping milk or other food products, are you achieving “quality bonuses?” Is your work force being optimized? Their performance can certainly influence quality levels.

3.)   What must we change? Earlier this year, I worked with a Client who truly was the definition of insanity. You know, being unwilling to change anything and then expecting different results! Their costs were high, their producing units were lower and, as expected, their feed program was awful. Results? Equally terrible!

When we run into challenges like this, my most difficult challenge is convincing people to make changes, and, as I stated in #1 above, the first task is to measure results. If you measure them you can understand them. If you understand them, you can control them, and if you can control them, you can improve them!

We never want to be an example of “insanity,” as I said above, doing things the same way and expecting different results. As I review the results of our Clients these past 10 years, I observe the following. Their Revenue has increased by 32%, & their Costs have risen by 17%. That represents the answer to the question in the title above: Where Are They Now? More significantly, it clearly shows that measuring their results every month has achieved two tasks. 1.) They boosted their existing income results and sought out new revenue sources. 2.) While they were faced with cost increases, they maintained their jump in expenses at a level that was less than their revenue improvements. How did they do that? Simply, by measuring and fine tuning their monthly cash flow!

My question for you is – “Where are you now?” If I can assist you with this, please contact me. This is challenging and is not a time for excess pride. It is a time for action.

“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!

Help is on the Way!

Two months ago, as I was traveling to World Dairy Expo in Wisconsin, I headed east on I-80 and noticed a semi-truck & trailer coming across the median toward our vehicle. Holy smokes! Fortunately, we were protected by the wire cables that separated the two sides of this interstate highway.

I called 911 right away to give the operator the mile marker where this accident had happened. After thanking me for calling it in, she exclaimed that “Help is on the way…”

Given the current milk pricing in the dairy industry, as well as the additional deductions being assessed by some cooperatives to shore up their Balance Sheets, many producers are likely hoping for the same thing… that help is truly on the way! Prices have been slammed to levels we haven’t seen for years.

What to do?

1.)   No, do not “put your head in the sand.” Survival will require your full attention.

2.)   Instead, realize that feed costs are at a very nice low point, keeping overall costs down. Additionally, your cull cows for beef and the calves you are selling are at lofty price levels.

3.)   However, even if these two items stay at their current levels, how long can you manage the upcoming low milk prices? Knowing your Break-Even levels will help.

4.)   Additionally, while our primary focus has been on milk prices, remember that there are a lot of other variables to consider.

5.)   What else can you adjust? Are you maximizing your milk production levels? Are there some costs that you can reduce? While we never want to cut costs to the point where it would hurt cow performance, is it time to look at multiple sources of commodities, i.e., initiate some price competition?

6.)   Is your labor force being fully optimized? Can we increase their productivity? When did you last bid out your insurance? How about Worker’s Comp and Supplies? Today, your very survival may depend on these reductions.

This is a time for action. Don’t delay. What’s your first step?

“The world has the habit of making room for the man whose words and actions show that he knows where is going.”                      Napoleon Hill

Let’s take your business to the Next Level!

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Can You Be Trusted?

How do we build trust with others, especially if they have previously taken advantage of us at some point?

Read more

What Are My Options?

In uncertain times, having options can be very beneficial, but what are they actually? Well, options come in many forms. You can buy them to set a floor under the price of a stock you are buying or selling. You can also use them to put a floor under the price of farm commodities such as milk, soybeans, corn, or wheat. Essentially, they provide you with insurance against a fallout in the prices you receive.

At the risk of sounding repetitive, they are a tool that provides you with genuine “options.” You effectively have some real choices. You can choose, for example, to sell at the price set by the option if prices have fallen below that level. If the market price is higher than the floor set in your option, you simply take the higher market price and let the option expire unused.

This is probably an oversimplification of the process, but it will give you an idea of how they work in the agricultural markets. They work just like insurance on your house. You only exercise the option if you have a “fire,” so to speak.

One of the biggest complaints I often hear about options, especially in the dairy markets, is that the options are too expensive. Really? If you honestly believe that, talk to a producer without a “floor” under his milk prices who just received $15/cwt for his milk. It’s not a free ride, but it provides you with some comfort that you are not going to get slammed with huge losses because of the prices received. It certainly beats being at a price that is $4/cwt below your break-even level…

Another objection is that if you set these up and don’t exercise the options, you have “simply wasted your premiums.” Well, well. Isn’t that interesting? Since they are another form of insurance (against price fallouts), I have one question for you. If you buy house insurance (& I hope you do) and then your house doesn’t burn down, do you call your agent up and complain that you really didn’t need the insurance? Of course not.

Likewise, with options, the only reason they will go unused is if you get higher market prices. So, your profits should be fine. Why complain about the cost of that “insurance” you put in place on your selling prices. The key here is to consistently use options to protect yourself against price volatility. Then, you won’t be saying, “Oh, if only I had…”

What action have you been putting off in this area? If I can assist you with this, please let me know.

Let’s take your business to the Next Level!

What Should I Do Next?

Recently, I had a Client ask me if they should go ahead and order the steel roofing they need for a barn reroofing project. The conversation turned to tariffs and what their impact might be on prices. Since he has the necessary Cash & Credit available, I suggested that he proceed. I’ll explain why in a moment.

However, I first want to address the issue of tariffs since they seem so prevalent in discussion today. First, tariffs are nothing new. Countries have been placing them on the U.S. for years. Prior to the Federal Income Tax being put in place in the early 1900’s, it was the primary source of financing for the U.S. government. While they can impact prices somewhat, the impact of tariffs is often absorbed by the Importer or Exporter whereby they take a smaller margin, at least for a while. Why were they put in place to begin with?

For the past 20+ years, the U.S. has run trade deficits with our trading partners, and these deficits were being financed by taking on additional government debt. Given the large trade and budget deficits of the U.S., we could not allow this to continue. The tariffs were also designed to move manufacturing back to America. Given the multiple trillion-dollar investments being pledged by corporations, it seems to be working.

Yet, let’s get back to the decision about reroofing the barn. Since the Client had the funds and his herd will clearly benefit, why wait? The tariffs and all kinds of regulations will occur. However, they should not impact a sound business decision. Besides, are they the “real” reason prices have risen or is it the impact of the past five years’ inflation?

When we are facing a decision, let’s consider the following steps:

·       Decide at the outset what goal you want to achieve.

·       Consider the pluses and minuses of the various options.

·       What are the next steps?

·       Who will complete these steps and by when?

If you focus on these key steps, you will undoubtedly make better decisions and achieve solid progress. Besides, if we always waited for prices to drop, wouldn’t we all be driving rusty cars from 1962? Think about it.

“It is always your next move.”

Napoleon Hill, Author of Think & Grow Rich

Let’s take your business to the Next Level!

Are You in a Delay Pattern?

As some of you may know, I fly a lot in my consulting travels across the U.S. I believe I have 1.4 million Lifetime Miles on United Airlines, as well as miles on some other flight providers. In those travels, “Delay Patterns” are not unusual, due to heavy air traffic flows & some weather challenges. Frankly, the airlines do a decent job of handling most of these hurdles.

A bigger concern I have is the number of delays that businesspeople experience in their ongoing activities. Bank approval of loans often gets delayed, with no apparent reason… Likewise, operators get delayed in making decisions, sometimes due to these loan approvals, but other times due to self-imposed postponement.

One example I can think of is the dairy client who stated that he would never pay $2,200 for a fresh two-year-old, so he paused. Today, 18 months later, the market prices of these cows are $3,500-4,000! Another prospect thought that $3.5 Million was too much to invest in a new rotary milk barn for his herd. Today, the cost has climbed to $6 Million…

To clarify, I think it’s essential that we realize we are in a different arena today. Post COVID, political handouts, government borrowing and the inflation that all of that has created, costs have increased and may very well continue into the foreseeable future. Now, that is not the only reason to move forward. They are just examples above.

However, let’s set a new course and simply make sound decisions, based upon their own merits, not just because something seems “too expensive.” Weigh out the pluses and minuses and then make the decision – Yes or No.

If there are risks associated with the decision to move forward or not, can they be mitigated? If so, go for it. If not, consider an alternative route.

Do you need one more reason to make a decision? Lack of good, well thought out decisions often can “mortgage the future” for your successors and leave the next generation in a deferred and often less enviable position. Who pays for this delayed action? They do.

Additionally, there are often positive results that are missed by delaying decisions. One client, in spite of having the funds available, deferred on building a new Bed-Pack barn. The result? They missed out on better cow comfort, more milk, and more revenue. They also failed to achieve an improved debt structure, as a result of their decision to not add an Asset to their Balance Sheet with no additional debt. Why wait?

What decision have you been deferring? Weigh the pros and cons before you decide and then move on to the next step today!

Let’s take your business to the Next Level!

What’s Your QTR?

Last week, I heard a new term, or at least it was new to me… QTR or Quality Time Remaining.

Of course, I have heard of Quantity Time Remaining. If you are 50 years old and plan to live until you are 80, your Quantity of Time Remaining would be about 30 years.

So, what is this term Quality Time Remaining? It is not only how much time you have left, but it is also what can you offer? How much time do I have left to contribute positive output that can impact others for the better?

I was talking with a prospect last week, and he said that, for the first time, he was being asked to provide his bank with an Annual Budget. I did not consider this an unreasonable request, but after 50 years with the same lender, the prospect was slightly offended. The loan officer’s quantity of time was 30-40 years (before he retired), but his Quality of Time was currently low on this measurement. He was new to this role and did not know how to create a budget with the customer. I’m not sure how he will interpret it when he receives a new one… Nonetheless, never having generated one before, the borrower did not know how to complete the process either.

Ultimately, it created an opportunity for me to build a budget for them. While the borrower “reacted” to the situation, I wanted to take a different approach. Have you noticed that “reactive” and “creative” contain the same letters? If I view this as an opportunity to be creative, the entire process will go much more smoothly.

My suggestion for you? Boost the amount of times when you can be creative and minimize the times when you are reactive. Life will be far better, and you will boost your QTR as well! Stay focused, and you will be prepared for whatever arrives, instead of wondering what just happened.

“People are always blaming their circumstances for what they are. I don’t believe in circumstances. The people who get on in this world are the people who get up and look for the circumstances they want, and, if they can’t find them, MAKE THEM.”

                                                George Barnard Shaw

Let’s take your business to the Next Level!

Remember the Scary Times?

Recently, I reread a book by Strategic Coach Co-Founder Dan Sullivan entitled the Scary Times Success Manual. The original version of this material was written for a group of entrepreneurs, following the 9/11 attacks. As Dan states in his book:

“As I was preparing for a special client event in New York City, I thought, ‘When something like this is happening, you have to forget about some things and focus intently on other things.’ I started writing and came up with a list of ten ‘forget about this, focus on that’ strategies, which turned into a four-page document that I called ‘The Scary Times Success Manual.’”

I thought it was so true that I wanted to share the ten points with you, because, interestingly, we seem to be in some scary times again with the advent of high interest rates, elevated inflation & falling commodity prices. The economics of business are changing, and we can either respond negatively or proactively to these challenges.

As Dan so accurately states: “While the shock and disruption of scary times can leave a lot of people feeling paralyzed to respond and act, entrepreneurs have some experience in dealing with scary times in their normal lives simply because they’ve chosen the entrepreneurial path and the challenges that come with it.”

Here are Dan’s 10 points:

·       “Forget About Yourself; Focus on Others” – When these scary times arrive, how can we help others? For example, what fears do your employees have & how can you assist them?

·       “Forget About Your Commodity; Focus on Your Relationships” – Stay in touch with your Vendors and Banker. You will definitely need them in the long term, so be sure to focus on the future and ask them what they think.

·       “Forget About the Sale; Focus on Creating Value” –  Motivation is key here, so be sure to key in on what you can offer to create additional value.

·       “Forget About Your Losses; Focus on Your Opportunities” – You must capture opportunities that arise by focusing on what is currently working and what might create more success in the future. What does the future hold and where can we grow & improve?

·       “Forget About Your Difficulties; Focus on Your Progress” – Treat this time period as one where you can make your biggest progress. Stay prepared, or you won’t be ready when your prices start to rise again. Instead, create a better you and as a result, better business outcomes.

·       “Forget About the Future; Focus on Today” – What can you do in the next 24 hours? Plan for positive results on everything. Send positive messages and always measure your outcomes, because if you measure something, you will understand it. If you understand it, you can better control it, and if you have more control, you can improve it.

·       “Forget About Who You Were; Focus on Who You Can Be” – Reinvent yourself and set bigger goals. Make the best use of technology to do so, especially with the advent of Ai.

·       “Forget About Events; Focus on Your Responses” – It is important to remember that we cannot always control the events that happen, but we most certainly can control our responses. When major events occur, a new normal will arrive, and you will be prepared for it.

·       “Forget About What’s Missing; Focus on What’s Available” – Recognize what changed. What areas do you need to clean up? Are there items you should simplify or change to set a new course for your business?

·       “Forget About Your Complaints; Focus on Your Gratitude” – Be grateful for what you do have and what you have been able to accomplish. Stay positive, because no one ever erected a statue for a pessimist!

I hope Dan’s 10 points help you as you move forward. Apply them as often as you can, and I believe your outcomes will be awesome!

 

“Don’t wait on perfect conditions for success to happen; just go ahead and do something.”

Dan Miller

Let’s take your business to the Next Level!

 

Was It Time for a Wakeup Call?

I have recently been hearing about organizations that are under “financial duress.” According to reports, they have been losing money for over 10 years and just recently decided to make some adjustments… Of course, there were plenty of “excuses.” First there was COVID, then we couldn’t hire sufficient help, then we saw inflation, the Fed raised interest rates, and, alas, now we are being subjected to tariffs…

As I said, they have now decided to make serious adjustments and develop a plan. Actually, their lenders likely decided that the company needed a plan for change. They may have been reaching a scary point on their “Burn Rate.” This is the amount of time a company has left, given their current rate of losses, before all their equity is gone. For example, if we have $1,000,000 of equity and lose $200,000 per year, we have five years left before all our equity is gone, assuming nothing changes.

This is not a fun position to be in. I also recently learned of a Homeowners Association that plans to assess each of their homeowners $25,000 to compensate for “deferred maintenance” in their community. This is a prime example of how past decisions, or lack thereof, can hurt future generations, because eventually the “toll will get paid…”

It reminds me of the old Sunoco gasoline commercials, where the mechanic suggested that we should be using their high-quality gasoline to minimize engine repairs later. While it was more expensive per gallon, he stated that you can “Pay me now or pay me later.”

I have one question for you to consider. Are there decisions or actions that you have been deferring into the future? Given the current economic situation that has resulted from COVID, hiring challenges, inflation, higher interest rates and/or tariffs, do you need to rethink how & when you might address some challenges in your life or business? If so, start to address them today. The future success of your family, the availability of necessary financing, or your organization’s very survival will be dependent upon it!

As I stated in my last blog, you will be better prepared for success, i.e. “Ready for the Big Dance” when better times arrive, instead of sitting on the sidelines, wishing you were more prepared. If I can assist you with this process, please let me know. It’s what I do best!

“All you need is the plan, the road map, and the courage to press on to your destination.”

                                                            Earl Nightingale

Let’s take your business to the Next Level!