Tag Archive for: Success Comebacks

What? We Have No Money?

This was the initial statement a Client made when I asked him how his cash flow was looking. Yet, was that really true, or was it a self-fulfilling prophecy, based upon our current market news? After all, this conversation happened in early 2026, a truly bleak time in the dairy industry…

More significantly, he said he felt like he was always playing “catch up.” If you feel the same way, do you know why? As I have stated in the past, if you measure your cash flow, you will better understand its components. If you understand them, you can gain control over them, and, of course, if you have better control over these variables, you can improve them.

Having a firm grasp over these Revenue and Expense items can make an immense difference in your outcome. Once you know and understand all of these, you can set new objectives for your business. Some examples might include paying all your Accounts Payable by the 10th of the month, keeping your loan payments all current and completing monthly measurement of your YTD Financial Results every month.

Some may say, “What good is that if I’m short of money?” I would suggest that these measurements are still quite valuable. As the saying goes, “the best way to get out of a hole is to stop digging.” This type of measurement can help you identify expense items that need reducing. However, your expenses may be completely in line with industry standards.

If that is true, then you might need to identify additional sources of revenue. In my Clientele, I have companies that have rental spaces generating funds, several who sell methane captured from their dairy, and some who market dairy heifers in excess of their replacement needs. What areas do you need to consider for added revenue or lower expenses? Set this thinking as a new goal for your operation. You won’t regret it.

“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!

Are You an “Overnight Success?”

I recently had an interesting conversation with a new Client who suggested that I was an overnight success. While I appreciated his kind comment, I had to admit that my “overnight success” only took 27 years of preparation.

This included many experiences, most positive & a few negative, to finally arrive at what may have looked like an overnight success… Believe me. There were plenty of rejections along the way. Yet, the best part of this entire process has been the wonderful Clients in this journey who had put their faith in my Team’s ability to navigate some “dangerous financial waters” and find a solution to their challenges.

Was it easy? No. If it had been, anybody would have been doing it… Here are a few examples for you, some of which may lead you to question my sanity in tackling these problem deals:

  • How about the food processing company who owed their bank about $8,000,000 and only had $2,000,000 of Accounts Receivable and Inventory on hand. However, they did have big hopes for the future of their product line(s), and we were able to get the bank to finance new equipment for an additional product line. This allowed us to generate cash and pay the lines of credit down to a more workable level. It also taught me that the only certainty when you are in the process of developing budget projections is that this is not exactly how things will turn out. Yet, the cash flow results were strong enough that it got us “across the goal line.”
  • Another Client was a struggling partnership that was burdened by owners not getting along & then getting hit with a cash crunch as their milk prices plummeted. In trying to identify the answer to their challenges, I was often reminded of the story told by President Ronald Reagan where a little boy was faced with a barn full of horse poop. When asked why he was so excited, he replied, “With this much horse poop, there has to be a pony in here somewhere!” The Client’s bank had just delivered a mandate through a letter, informing them that they should start liquidating assets. I responded with a three-page email, refuting their “short term thinking” and laying out a game plan for their successful continuation. I met with them every month, and, frankly, it was the fastest financial turnaround I’ve ever coached someone through. Within two years, they had sold the entire partnership operation and real estate, allowing two of the former partners to start new businesses that they are operating today.
  • Three other examples revolve around Clients who I would describe as “land rich & cash poor…” As a result of a horrid loan structure, they became strapped for cash. By restructuring their overall debt and expanding their operations, we were able to boost their overall cash flow to the point that they were very profitable and in a position to market young animals from their dairy businesses. This, too, created an additional source of cash to help them operate. Overnight success? No, but ones that would not have happened at all without the plans we designed together.

All these examples met with success, following a lot of demanding work, planning, and solid execution of the plan. Sometimes, I even had to remind them “Success often is described as the willingness to bear pain; not to be a pain…” By working together in each of their cases, I am pleased to report another “overnight success.”

“The difficulty lies not so much in developing new ideas as in escaping from the old ones.”

John Maynard Keynes

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What Is Your Reason?

I recently reread an old book from my personal library, entitled The Goal, written by Eli Goldratt & Jeff Cox in 1992. I read this 34 years ago, and, assuming you can still find a copy, I would highly recommend it.

Essentially, it is a novel with a great story that revolves around a corporate turnaround, one where the players initiate a change of strategy previously characterized by poor planning, numerous bottlenecks in the manufacturing process and consistently late deliveries.

As you might expect, based upon the title, the managers in this process had a two-fold mission to improve their delivery of product, but also set higher goals by challenging prior assumptions. I know. This is basic “corporate blasphemy,” but “challenging the system” is what I’m well known for. Frankly, it has served me very well.

Getting back to The Goal, it has some very solid lessons for us. Foremost, we need to take old assumptions at face value and consider that there are other ways to achieve new goals and accomplishments. One of my favorite parts in the book included a complete challenge to management on their thinking.

To put this into perspective, I had a recent meeting with a Client who was considering the completion of a new Bed-Pack Barn for their dairy herd. It would give them a boost in their operation by getting the rest of their herd out of muddy lots in the winter & hot sun in the summer.

They run a great operation with milk production/cow/day consistently in the 80-85 lb range. Unfortunately, the managing partners are sometimes dissuaded by well-meaning family members from making investments in their business that are proactive.

They asked if I felt they should complete this process, especially considering that the cost is being funded mostly by government money. I stated, using a section on page 150 of the book, that there are only two reasons not to complete it.

  1. If there was no market for their product. This is not the case for them or the Cooperative they sell milk to.
  2. If they are determined not to change anything in their operation for the better. I don’t believe that’s the case. If so, I probably cannot help them succeed…

Consider the pluses of this change. First, their business would improve from higher milk per cow. Additionally, their banker should be happy as the appraised value of the facility increases with no added leverage from more debt, decreasing their Loan to Value %. Even animal welfare advocates should be happy, given the improved conditions for their cows.

While the completion of this project is pending, I believe this would be a positive step forward. Are you facing a similar dilemma? As you think your hurdles through, please consider the positives & the potential downsides, but do move forward. What reason do you have not to accept the challenge to succeed?

“Change can be tough. But the only alternative is eventual obsolescence.”

Michael Hyatt

Let’s take your business to the Next Level!

What If You Could?

Recently, I was thinking about a Client with whom I have worked for several years and, as I reviewed their financial results, I was thankful for the positive progress they had made.

When I first met with them, they were quite disappointed that their results were not very solid. In fact, their banker had already put them on notice that they were close to being shipped off to the bank’s infamous “Workout Group.” That is a department you definitely don’t want to end up in. While some may think that it’s a place where you work out your financial challenges, I assure you that it typically is a department where the participants “work your loans out of the bank,” and it is usually high pressure.

Regardless, this Client was not very profitable, and, due to their losses, they were approaching a level of debt leverage that would make them unable to acquire additional financing…” Thus, I asked them the following question: “What if I could guide you to become more profitable and lower your debt/cow? Would you be interested?”

Their first thought caught me a little off guard. They asked if my assistance would be free. After assuring them that I was not with the Red Cross, we started serious discussions about how we could achieve these goals. My first task was to establish what they specifically wanted to accomplish and then, after evaluating what their current position was, start building a plan to move them forward.

Part of the process included a restructuring of their debt load. Of their total debt, far too much was on short term loans, and way too little was against their real estate, which was quite highly valued. Following the restructure, we got them involved in positive budgeting. After developing their budget, we tracked their actual results against it every month. As I have said before, if you measure it, you will better understand it. If you understand it, you can control it, and, of course, if you can control it, you can improve it. This is true with any item, including Cash Flow.

Once we had this process moving forward, we initiated a program with the help of their Nutritionist to boost their milk produced per cow. With the optimal nutrition in place, they started milking fresh cows 4X/day, at the beginning & end of each milking shift. With more cwts of milk produced, we lowered their cost/cwt, always a good thing to do.

Finally, I convinced them that with their higher production and improved herd health, they might want to expand. Making more total cwts, just as with their higher milk per cow, helped them to spread fixed costs out very nicely. Incidentally, the milkers still got their shift done in the same amount of time, even with the 150 added cows.

Voila! Just like magic, all these changes assisted this Client to succeed at a higher level. So, if you are having some challenges in your business, consider “What If I Could…?” I would be happy to assist you with the process!

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

Winston Churchill

Let’s take your business to the Next Level!

What Do We Do Now?

In my last blog, I discussed being willing to pay the price for success and what it will take if you want to consistently move to higher levels of achievement.

At the start of each of my Management Team & Finance Team Meetings, I like to begin by asking the following question: “What project or challenge is on the horizon for your operation this month?”

I recall an interesting meeting with a Client who told me he was behind with his feed company, the feed company was pressuring him to get caught up, and he needed to decide what to do.

Of course, he had two obvious options. He could panic or he could simply hide out, but neither of them seemed like particularly good choices. However, I suggested to them that they had two other positive options available to them.

  • They had a low fixed interest rate on their real estate loan, and it matured in two years. Given their low Loan to Value on that real estate loan, why not put a note payable behind the existing loan? It could mature in two years, at which time they would refinance the real estate loan anyway, either with their current lender or someone else. They could even keep the added loan payment small by amortizing it over 20 years and having it mature at the same time as the existing real estate loan.
  • The second option that they had revolved around the 10% “excess” heifers they were carrying. By selling these extra animals, they could generate $300-400,000 of cash and lower their feed expenses by raising less heifers. Most important, they would still have sufficient replacements to maintain their herd size.

The significance of this discussion lies with the fact that, while they had a challenge to overcome, they met it head on, and we identified options we could use to reach a greater level of success.

Option #1 was possible because we had been pushing the Loan to Value downward by making the regular monthly payments and, whenever possible, adding assets to the real estate that boosted its value. This provided us with the opportunity to acquire the second loan we needed.

Option #2 was available to us due to having an excellent breeding program and then always focusing on the question: “Based upon our financials, what challenge or project do we need to focus on this month?”

What is your approach in situations like this? 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 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!

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!

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!

Will You Be Ready for the Big Dance?

There seem to be a lot of downtrodden businesspeople these days. They are discouraged about inflated costs, high interest rates and difficulty getting employees to perform.

When things get tough, “Cost Cutting” often becomes the mantra. To an extent that is fine. However, we cannot simply save our way to prosperity by only cutting costs. If it were true, all we would have to do is reduce our expenses. On the contrary, I suggest that you only cut costs to the extent that it does not hurt the performance of your business.

In 2009, I watched some dairy producers cut back on feed costs to offset the greatly reduced milk prices. While that may have looked okay in the short term, in the long term, it really stymied their operation’s performance. When milk prices rose again, they were not prepared to respond, and cows did not come back into their maximum production very quickly. They were lackluster, at best. Profitability suffered for at least another year.

We are going through another trying period of inflation, high interest & tighter margins. With that in mind, let’s limit our cost reductions to the items that do not directly impact productivity of your business.

Motivational speaker Les Brown tells the story of how, early in his career, he had wanted to be a DJ, a disc jockey. An experienced adult told him that he had to be hungry & ready to take action. He went to a radio station in Miami and was rejected for a DJ position numerous times.

However, on the advice of his mentor, he studied and practiced being a DJ, because he was advised that it was far better to be prepared & not have a job, than to be unprepared when an opportunity did come along. One afternoon, his chance surfaced when another DJ was drinking heavily and could not finish his show. Les Brown stepped in, completed the show, and, as the saying goes, “The rest is history.” However, what would have happened if he, not having a current opportunity, had just not bothered to be prepared?

My point is this. Be prepared. These challenging times with high inflation and higher interest rates won’t last forever. Tough times don’t last, but tough people do!

Watch your costs and adjust them where you can. Just don’t stifle your operation’s productivity in the process, and you will be 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.

“You gotta be hungry!”

                      Les Brown

Let’s take your business to the Next Level!

Is It Time to Reset?

I recently finished reading a new book by Dan Heath entitled Reset.  It is an excellent book, and I would highly recommend it. The book contains a tremendous amount of change management and outlines methods we can use to make huge improvements in our processes.

One area where I hear the most complaints from Clients is “Labor Challenges.” Heath points out that “there is no emergency, only choices.” The key to making improvements on labor or any other issue, he suggests, is to identify “Leverage Points & Restack Resources.”

In one business, for example, the management team was having difficulty with employee motivation. As a result, they shared a questionnaire with employees that asked four questions that they could answer anonymously:

·       What makes a good workday for you?

·       What makes you proud to work here?

·       When we are at our best, what does that look like?

·       What are any impediments to your performance?

Then, in response, the same management team addressed these issues quickly, especially the small ones. For example, the coffee machine did not always work properly. It was relatively low cost and got replaced right away. They leveraged this item (at a reasonably low cost, too).

Additionally, they put three clear, plastic boxes at the place where their employees exited at the end of their workday. One box had orange ping pong balls, one had white ping pong balls, and the third one was empty. As they left work, the employees were asked to put orange ping pong balls into the empty box if they had experienced a difficult or unreasonably challenging day with conditions that needed to improve. If their day was solid, they were requested to place a white ping pong ball into the empty box, likewise giving management some immediate feedback on the day.

If you think about it, this process was very practical and provides a good example of participative management by asking the employees: “What matters to you?” It identified leverage points that were important to the crew and allowed management to “restack resources,” often at very low cost, to create a better outcome.

Give this some consideration in your operation, and if I can assist you with this, please let me know.

“People often say that motivation doesn’t last. Well, neither does bathing – that’s why we recommend it daily.”

Zig Ziglar

Let’s take your business to the Next Level!