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When shopping for some outdoor furniture, I received a recommendation to go to a particular store. When I arrived, I walked into the shabby retail location feeling very unimpressed. However, after speaking with the business owner I found that his retail location resulted in only a mere fraction of his sales and that the majority of the business came from an extensive distribution network and from exclusive design deals he had established with the four manufacturers who make wicker furniture in China.
So why did I walk out of there incredibly impressed? When I asked how the economy was impacting his business, he coolly responded with facts and figures that I had not often heard from a business owner—and certainly had not expected to hear from this one. He clearly had a plan. He laid out how he could cut costs and increase distribution channels, even if revenues dropped by 40%. He knew exactly how much cash he had and how long it would last him, and where his major costs were and how he could flexibly adapt to the market.
Was he worried? No. Concerned? Yes. Was he sweating a downturn? Absolutely not. It seemed to me that he sleeps pretty well at night.
Do YOU have a plan? If not, make that a priority for 2009. If yes, revisit that plan early in 2009 to make sure it is still relavent.