How is Your Business Really Doing?

Customers queue outside an M-Pesa shop in Nairobi
Customers queue outside an M-Pesa shop in Nairobi

In modern culture, fake-it-till-you-make-it is a major theme. And social media doesn’t help matters. People have learned to put their best foot forward, hiding their true realities. Faking success won’t change your reality.

For the entrepreneur, fake-it-till-you-make-it is a dangerous concept because in business, it helps to have a healthy relationship with reality. Often, I tell my clients that: reality is the entrepreneur’s best friend. It’s a place from which concrete strategies can be hatched to help take entrepreneurs forward. Reality will take you further than faking success. So, let’s practice.

You will need pen, paper and a comfortable place to sit and reflect for this part; grab some hot chocolate if you wish. But, you will need to do this exercise truthfully to get a clear picture.

Let’s start by asking you a simple question: how is your business really doing? Not what you make people think or believe about it, but how are things really? Drop the fake hat for a minute and think. I will help your thought process with more questions below.

What is your quarterly/yearly revenue? How much comes in from the delivery of products and services? At what rate is it coming in? If the current revenue flow is sustained for the next three years, would you still be in business? Do you like your current reality?

What is your quarterly/yearly profit margin? First, are you making money? Are you making profit? Some entrepreneurs are disillusioned in this area; they have refused to acknowledge what is on ground. This self-deception is normally caused by unhealthy optimism.

What are your yearly goals? In the last 12months, where did you plan to take your business? Did you get there? If yes, why? What elements contributed to your success? If no, why? What stopped you from reaching your goals and how can you do better?

How do you measure progress? Do you have concrete measures or an emotional yardstick? How do you view progress? Do you inflate figures to make yourself feel good or are the numbers real? How you measure progress affects your view and reality.

How many paying customers do you have? It is important to know the number of paying customers that you have and also, understand their buying trends. Are they loyal customers or do they show up once in a while? How much products or services do they buy? Do they refer you to others? Do you have a healthy relationship with your buying customers?

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