For as long as there have been tire magazines, we have looked for ways to improve your business. For the most part, we have focused on the basics – clean restrooms, inviting showrooms, training, technology, radialization, computerization, inventory control, employee pay and more.
But, that was then, and this now. Many of you have taken over your parent’s business or started your own. You know – and apply – the Tire Dealer 101 stuff with great results but are hungry for a different kind of assistance to take things to the next level.
That said, have we looked under enough rocks? Perhaps not, as we all look for expert advice from the same resources, from people with the same experiences as our own. As they say, a sure sign of insanity is doing the same thing over and over and expecting different results.
Much as we suggest you think outside the box, we’re going to take an outside-of-the-box look at some business-oriented things you may be doing wrong – and offering thoughts on how to correct them.
In looking for information that will help shape new thinking, we came across Steve Pavlina, who made his share of business mistakes when he was in the computer-game business. His blog (stevepavlina.com/blog) is impressive in its frankness and freshness. And, he likes to ask unnerving questions.
Mistake #1:
Dealing With the Wrong People
This mistake comes on two levels: Selling to the wrong people and spending your valuable time networking with the wrong people, Pavlina says.
“Selling to the wrong people includes trying to sell to everyone,” Pavlina writes. “If a potential customer is broke and obsessively worried about every nickel he spends, or if he wants a particular product but doesn’t know why, he won’t be a good client in the long run.”
If that isn’t on target, what is? “Feel free to say ‘no’ to customers who are more trouble than they are worth,” says Pavlina. “Allow your competitors to sell to them instead. You’ll save yourself a lot of headaches and free up more time focusing on serving your best customers.”
In his first year in business, he admits to saying ‘yes’ to at least half of the people who approached him with a potential business relationship. “I wasted a lot time pursuing deals that were too much of a stretch and accepted lunch invitations from random business people who just wanted to see if there was a way we could do something together. If you think a meeting is pointless, it probably is,” he says.
His advice: “Don’t network with random people just because you think you’re supposed to network. Now, I accept invitations less than 1/10th as often, and if any offer doesn’t excite me right away, I decline or ignore it.”
Lesson: Learn to say ‘no’ to weak customers and weak opportunities so you have the time to say ‘yes’ to strong, long-term customers and golden opportunities.
Mistake #2:
Underestimating the Value of a Lawyer
Constance E. Bagley, an associate professor in the entrepreneurial management unit at the Harvard Business School, thinks you should know more about the lawyer you hire.
“Many venture capitalists say they often rate the judgment of entrepreneurs by their choice of legal counsel,” she says. “Lawyers who have no experience working with entrepreneurs and venture capitalists will most likely focus on the wrong things, while failing to recognize some of the more subtle potential traps. It’s better to hire someone who has played the game, who knows what’s standard and what isn’t, and who will get the deal negotiated and closed promptly.”
What does that mean to you? Well, does your lawyer really understand small businesses? Does he or she ‘get’ the nuts and bolts and details of your day-to-day existence?
The point here is that, despite the fact no one wants to pay for lawyers, all businesses need them. And, they can be valuable members of the team, provided you find one familiar with your kind of business. You only get out of something what you put in, so you also need to take the time to explain the details of your business. The end result will be solid advice and even better protection for your business.
Bagley really lays it on the line when she talks about businesspeople who think legal problems can be solved later.
“There’s a tendency to think, ‘Once I get my business up and running, I’ve got time to hire a lawyer. Right now, I’m running as fast as I can to get my business plan done and raise money.’
“This is shortsighted logic,” says Bagley. “Many of the problems that exist can’t just be patched up later.” Does that mean that dealers should devote all of their time, effort and money to legal issues? No.
“But, it’s a good reason to hire a competent lawyer,” says Bagley. “Excellent legal talent can be retained for relatively little money up front in the early stages. It will cost much less to get it right at the beginning than to try to sort it out later.”
Lesson: Good advice and long-term counsel is vital, but you have to set the stage by 1) having a lawyer and 2) educating that person to understand your unique business.
Mistake #3:
The Devil Really is in the Details
Henry Ford often said, “Thinking is the hardest work there is, which is why so few people engage in it.”
Thinking is indeed hard work, especially when it comes to developing a realistic business plan and actually executing that plan.
Of course, that assumes you have written a business plan. You have, haven’t you?
Presuming that you have written an annual plan, it’s also important to understand that it’s never too late to make changes.
Try answering these questions: What went well last year? How will you build on last year’s results – good or bad? What key value or attribute of your business do you want to enhance? What activities or initiatives do you plan to undertake or cease in the coming year? What is your growth target for the coming year? What are the major risks you will face next year, and how will you confront them?
Without a good map, any traveler will get lost. It’s the same with a business plan. If you don’t know what you need to accomplish, how can you possibly get there?
Keep in mind, too, that your bank or another source of funding may well require an annual business plan. This is where being detail oriented can make or break a deal.
Let’s say you’re ready to expand. If your plan is poorly written – spelling, punctuation, grammar and style – how can you expect others to get behind that plan? Even your own employees, who should be part of the execution, will not rally around your flag if it looks unprofessional. Don’t stop reading now, though; good news follows.
Before you unveil your plan to a single investor, banker or employee, go through every letter and line with a fine-tooth comb. Don’t trust that the spell check on the computer will save you; it only looks for spelling errors. It won’t catch the wrong word if it’s spelled correctly. Have someone with strong English skills review it for spelling, style and grammar problems.
As for style, there is no set answer. Style is subtle, and different entrepreneurs write in different styles. If your style is confident, crisp, clean, authoritative and formal, you’ll rarely have problems.
If your style is arrogant, sloppy or folksy, you may turn off the people you need to help make your plans a reality. And, be sure your plan is consistent, thorough and fits the intended audience.
Lesson: Thinking is hard work, but set aside sufficient time to develop a solid annual business plan, and make sure to dot all the ‘I’s and cross all the ‘T’s.
Mistake #4:
Disregarding Your Gut
We have all heard this advice: Think with your head, not with your heart. Well, truth is, intuition is more valuable than you may think.
Einstein called intuition the highest form of learning. “It is timeless and one of your very best friends, always at your side trying to get your attention.”
“You’d be amazed at how many gigantic corporate deals are green-lighted or red-lighted because of some CEO’s gut feeling. While you might think that logic is the language of business, you’re far from reality,” says Pavlina.
Many business people rely on their intuition – the sum of their collected knowledge – and attribute their success, in part, to the use of their instincts. In a study of high-tech company executives, 80% acknowledged using their intuition when making decisions. Not only is intuition an invaluable tool in forecasting future trends, it is a major component of creativity.
Post-it Notes were born from a hunch, and police detectives have been known to trust their instincts in solving crimes. Fashion designers go with their instincts to predict future marketplace trends.
Decisions shouldn’t be made on instincts alone, though. Intuition should be part of the equation. Conclusions need to be made or action taken after considering all the information. If your gut tells you it’s the right or wrong thing to do, get behind that decision 100%.
Something else to consider: Intuition is no way to predict behavior. “We humans aren’t very logical to begin with. We simply don’t have enough data to make truly logical decisions because business deals depend on human beings, and we don’t have a logical system for accurately predicting human behavior,” Pavlina says.
Don’t assume that everyone will perform as expected in any business arrangement. It’s unrealistic. No deal ever goes perfectly. Since business deals depend on relationships, you need to get a read on the other people involved in any deal you consider. If you get a bad read (from your intuition), walk away. If you get a good read, proceed with caution.
And, don’t be afraid to seek some outside input. Look for mentors, including retired business pros, who can give you advice. Run your ideas by some proven consultants before you make major financial commitments.
Lesson: While you cannot manage based solely on what your gut says, your collected knowledge is still an invaluable tool in reaching decisions.
Mistake #5:
Selling Yourself Short
Don’t be misled to believe your products and services will ‘sell themselves.’ Marketing keeps products selling and money flowing. It’s crucial that you do it well. But, it takes more than some fresh ads and some sharp banners.
A top salesman once said: “If you don’t believe in your product, you can’t sell it.” That means study time for you and your salespeople. It’s your obligation to know virtually everything there is know about the tire and service products you sell. Anything less can kill a sale.
Today’s tire shoppers can jump online and learn much of what they need to know about any tire you sell. So you need to know even more, especially how that tire is the best (or worst) option for that individual customer.
When explaining tire features and benefits, tiremakers paint with a broad brush. You need to bring it down to the level of that particular customer. And, tiremakers love odd acronyms and strange names to label construction or performance features. You need to decode those monikers and explain how those unique features help the driver.
And, you have to believe in every one of those features.
Keep in mind that the typical tire buyer is only going to be in the market for 24 hours or so. You have to think of every one of them as an asset and convince them that your products deliver the best solution to their transportation needs. You can’t do that if you don’t understand what you’re selling or don’t buy into the product’s features and benefits.
Another point here: First impressions are everything.
The only difference between you and the next person lies in the intangibles of your personality. It’s the same with your business. If customers see an unkempt staff and store, they will not have much confidence in your professionalism.
Psychologists tell us that first impressions are based on a spontaneous assessment of status – clothes, age, size, posture, speech and facial expression. The salesperson (or technician) who doesn’t care what he or she wears or how he or she looks merely confirms a lack of concern about your business, products or customers.
That is not to say that you and your employees should come to work in suits. Far from it; the job can be dirty. But, you can wear uniforms and/or team clothing that set your business apart in the mind of the customer.
Have you ever mistaken a customer for a store clerk? In our casual society, that happens all the time. That’s why your job is to establish your team in a fashion that brings a sense of confidence in your customers’ minds.
A quick word about self-confidence: “Confidence plays the major role in self-invention,” says business writer Stephen Bayley. “The great thing about confidence is that it is self-perpetuating. Get a little, and you will soon have more. It is a cumulative process. As people respond positively to you, your confidence grows.”
Lesson: As Kurt Vonnegut once said, you are what you pretend to be. Nicely explained. How you present your business and yourself – including a level of confidence – makes all the difference in the mind of a customer.
The Right Stuff
In the accompanying article, we discussed five things you are doing wrong. Here are two things you need to consider.
Love What You Do – It’s easy to fall into the trap of thinking that the purpose of a business is to make money. But, the real purpose of a business is to create value. The money will naturally follow.
If you don’t love what you do, though, all the money in the world isn’t going to make a difference. Entrepreneurs got into business to be the boss, to control their destinies. But, if you don’t relish each day’s challenges – and you know there are challenges – you may want to rethink your life goals.
In her book Do What You Love, the Money Will Follow, Marsha Sinetar writes: “Work is a natural element, a fulfilling expression of the life force within a person. Even with its ups and downs, time demands, pressures or conflicts, work is experienced as pleasurable and something to be done, both as a personal calling/destiny and as an activity that helps one grow into a better, more enlightened, perfected, capable, trustworthy, committed human being.
“Work itself is playful and fun, an activity that permits the individual to tune into deeper, more truthful, parts of himself. It is something connected to a part of the spirit, mind, body and senses – a mirror of the person. It is neither good nor bad in the judgmental sense of one job being better than another; rather, it is what makes sense to a particular person’s life.”
Put Your People in the Best Position to Succeed – Ask any baseball manager what his or her job is, and you’ll get the same answer: “I have to put the right people in the right place to maximize their opportunity to succeed.”
It’s the same in business, especially in a small business without the luxury of a huge staff.
In their book Now Discover Your Strengths, bestselling authors Marcus Buckingham and Dr. Donald Clifton agree that “each person’s talents are enduring and unique, and each person’s greatest room for growth rests in the areas of the person’s greatest strength.
“Eight out of 10 employees feel they are miscast,” they say. Put another way, 80% of your employees believe they have never had the chance to reveal the best of themselves. Too bad. They suffer for it, the organization suffers, and your customers suffer.
“But, it doesn’t have to be this way,” according to Buckingham and Clifton. “The idea is to spotlight each person’s strengths. Provide that person with a manager who is intrigued by these strengths. In this way, an organization can be built that asks each employee to play to these strengths and honor them when they do. Show employees the best of themselves, and ask them to keep reaching for more. Help them live strong lives.
“It’s up to us as business owners to find the best fit possible in terms of employee strengths and the roles we ask them to play at work. Only then will your business be as strong as it should be. Only then will you win.”
Finally, never forget to ask for the sale because you never know what’s going to happen. One morning, Henry Ford was having breakfast on his large, screened-in sunroom. The newspaper was in front of him with a screaming headline: “Henry Ford buys a $1 million dollar life insurance policy.”
His neighbor, a highly successful insurance salesman, walked across Ford’s lawn, opened the door to the sunroom, and said, “Henry, how could do this to me. Why didn’t you let me sell you that policy?” Ford replied: “You never asked.”
