Nowadays, I think of my business as a high performance automobile engine, which must be finely turned and calibrated to run at its optimum speed and maximum efficiency. I can tell you from experience that in order to operate a small business at maximum efficiency and profitability, it takes:
1. Personal and financial discipline.
2. Organizational skills.
3. Management know-how.
4. Meticulous planning and attention to detail.
5. Prioritization of tasks according to their profit potential.
6. Maximum use of available technology.
7. Accurate record keeping.
8. Maximum use of all the tax benefits that are available to small business owners.
It Takes Discipline to Operate a Business at Maximum Efficiency and Profitability
It takes a combination of personal and financial discipline to operate a small business at maximum efficiency and profitability. First, you need to have the initiative and self-discipline that’s required to be successfully self-employed. You must work smart, so you don’t waste your valuable time doing grunt-type tasks that can be hired out. In other words, don’t spend your time cleaning up trash around your office when you should be out searching for customers. Second, you need to possess the financial discipline that’s necessary to operate your small business at maximum profitability. The only way that you’re ever going to be able to keep your spending under control is by:
1. Adopting a bottom-line mentality that’s totally focused on maximizing the profitability of your business.
2. Operating your business on a bare-bones budget by buying all equipment, supplies, and services at the lowest available prices in your area.
3. Keeping close track of operating expenses by carefully reviewing all invoices for errors, overcharges, and bogus charges.
Prioritize Tasks according to Their Profit Potential
The number one question that you must continually ask yourself when you’re working in your small business is: Is what I am doing right this minute the most profitable use of my time? A lot of people fail as small business owners simply because they’re never able to prioritize tasks according to their profit potential. They end up never making a profit because they couldn’t distinguish between what’s important and what’s trivial. As a general rule of thumb, I consider any business function that doesn’t contribute directly to my bottom line to be low priority and best left for after business hours. In other words, if the task at hand isn’t part of the process of completing a real estate transaction that will eventually end with me going to the bank; I put it off until later in the day.
Avoid Reinventing the Wheel Every Time You Need to Complete a routine Task
Whatever you do, don’t fall into the trap of reinventing the wheel every time you need to complete a routine task. The term, reinventing the wheel, refers to re-creating something from scratch. An example of reinventing the wheel would be retyping standard documents, such as purchase agreements, over and over again, instead of storing them in a Microsoft Word document file where they can be printed out as needed. The point here is to work smart by making your operating as streamlined as humanly possible.
Operate Your Small Business on a Bare-Bones Budget
One surefire way to fail as a small business owner is to run your operation in a slipshod manner with no financial controls in place to keep your operating costs from going through the roof.