Updated: Jan 18
If you're going to run a business, you need to really know your business. I've always referred to “knowing my business” like knowing the back of my hand! I have always run my businesses with napkin math, which was then backed up by our corporate CFO and business plans. The key is to know your business so well, that you can quickly make decisions to seize opportunities as they come.
Knowing the key indicators that make your business run is essential.
A few questions to ask yourself…
What is your utilization rate?
How is your contract management, referral management?
What is the cost of your employees?
What exactly are the key indicators that you need to know about your business?
You need to know how to grow your business! I want to talk about these topics specifically.
How you stay on track for the 2020 year budget
If you get off-budget, how are you going to get back on your budget
How to make the money that you should be making
Make certain you are spending the way that you should be
I want you to think of all the pieces that go into playing alongside each other to make your business run. For my business in healthcare, it came down to rates, contract negotiation, and contract fulfillment, knowing how many clients I had, and the most important was knowing the salaries and expenses that were going out of my business and then creating a dashboard so that I could see those stats at the click of a button.
Next was really figuring out how I was going to stay on the budget that I had created, the budget that was created in a perfect world. When I first created budgets and business plans, they were only if all the stars were aligned. Ensuring that you've developed a budget is one thing. The important step is to guarantee that you know how to stay on that budget. After a decade in business, I started to realize the years that the stars aligned were far and few between. So the resolution was to focus on how to on budget and think about and plan ahead for when the stars don't align and your budget is not on track. A well thought out budget will help you get through the year to meet your year-end goals. Always ensure that if you are not on the budget that you stop, assess quickly and make a change.
One piece of advice I give entrepreneurs constantly is if you keep doing the same thing that you were doing yesterday, you're going to continue to get the same results today.
How to assess your spending and your expenses.
The goal is to take a look at your expenses and constantly be negotiating those expenses down. Some expenses will continue to rise. However, as you become a bigger player in the healthcare field, you should be working on negotiating down contracts such as your tablet contracts or your software contracts. The reason healthcare industries are continuously getting acquired by larger groups and merging their businesses is to acquire better deals on those types of services.
As your business continues to grow, go to the people who are providing your services and ask them to start decreasing your contracts. Negotiate those prices down. Just remember, as you're growing your business, they're trying to grow theirs as well. They want to keep you as a happy customer.
At the start of every year, I sit down and look at all of my business contracts that are an expense to my company, and instantly make a list to have somebody start the process of negotiating those expenses down, even if it's just one to 1- 10% it's going to be a savings on that bottom line.