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Wednesday, 3 December 2008
Is your business too clever to survive?

If I had a pound for every time I came across a business owner explaining that such and such – usually something that looks out of place in their business - is there as a historical accident I could probably retire.

 Here are some:

• A new product or service you are not really geared up for that you started to do so as to please a large client – for example buying media if you are really a design agency.

• A band of clients that you can’t service profitably, but that you stick with because they keep someone in your company busy.

• A department (or job title, or directorship) created just to keep someone happy.

• A department that used to do something that earned you money that stays in place long after technology or the market passed it by – for example a traffic department doing work that account handlers can do.

You may have one or more accidents of history in your business and if you do, why should you be worried?

Historical accidents make your business inefficient and uncompetitive. They use up cash and destroy your profits. If you lie awake at night worrying about the business then maybe you should start to deal with these long neglected issues.

Do you have any historical accidents alive and kicking in your business and why do you sustain them?

 

 

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Posted By Enter the FD's office. at 3:37 PM in Category:Creative Business
Link directly to this article.
Replies
Paul Winter

When the good times roll, it is very easy to overlook non profitable clients or parts of your business. Not that we are on some pedestal. I have employed people (in the past!) who did not contribute to profitablility, and retained clients because the 'turnover' was valuable (rather than looking at what they contributed to the bottom line).

Survival is now the name of the game and the current market conditions should focus us on sorting these parts of our business out.


4 Dec 2008

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