Why do so many businesses fail within the first five years? A lack of experience by the owner can certainly play a major part in any business’ failure. Experience isn’t something you can buy. It is learned through challenges, successes and failures. Too often people rush into business before they’ve had a chance to gain the experience that can be so powerful to building a profitable business. So how can you avoid failure while employing the proper tools to gain experience? You can do it by avoiding big mistakes and learning as you go. 2nd reason for failure : People dont ask for help early enough in the game !

1. 5
Mistakes
Business
Owners
make

2. Your Coach this morning
Elsa Groenewald
•My History…
•WHY…
•Business coach,
mentor and trainer …

3. A little bit about us …
• We are the “World’s #1 Business Coaching Firm”
• We have more than 1000 Coaching Offices in 54 countries
world-wide …
• Privately owned and founded by Brad Sugars, an Entrepreneur
with over $150M in net worth …
• Our Vision is to create “World Abundance through Business
Re-Education …”
• We coach over 15,000 businesses each week across USA, UK,
Australia, New Zealand, Malaysia, South Africa, Namibia,
France, Canada and Mexico…

4. Failure to seek
outside advice…
soon enough in the
game…!
…and achieving…
The # 1 reason for business failure?

5. The Rungs of Action’s E-Ladder …
Create Money with Other
Peoples Ideas &
Network
Make Money with Money
Make Money from Profits
Earn Money from
Managing People &
Assets
Earn Money for self
Earn Money from job

6. FAILURE RATE:
4 out of 5 business in first 5 years
A lack of experience by the owner can certainly
play a major part in business’ failure.
Experience isn’t something you can buy. It is
learned through challenges, successes and
failures. Too often people rush into business
before they’ve had a chance to gain the
experience that can be so powerful to building a
profitable business.

7. The 2nd reason for business failure?

8. 5
Mistakes
Business
Owners
make

9. 1. THEY DON’T KNOW THEIR NUMBERS
“If you don’t know your Numbers,
What is the focus of your Business ?”
Budget, review, forecast

10. Build yourself a Business Dashboard

11. What are the KPI’s...
Cash in bank (+/-) & % incr/decr
Days Debtors - # of days & amount
# of inquiries
Leads generated
Orders taken
Lead to Business Conversion rate
Average value sale
Ave # days to complete orders
Monthly revenue
Monthly G.P.
Monthly Expenses
Monthly Profit

12. Profit & Loss Statement
• Sales
• Cost of Goods
Sold
• Expenses
• Profit/Loss
0
1000
2000
3000
4000
5000
Jan. Feb. Mar. Apr.

13. The Margin Distinctions ...
Margin
vs
Mark Up
Set Your Prices To Achieve the right Margin …

14. The Different Margins ...
Some Products/Services May Be Impacting Your
Gross Margin – Make Sure These Are Right First
Gross Margins
vs
Net Margins

15. Example
Revenue = R 100
Cost = R 67
Gross Profit = R 33
MARK-UP = 50%
MARGIN = 33%
GP / COST
GP / REVENUE

16. 2. THEY DON’T UNDERSTAND THAT SAVING A
WAGE WILL COST THEM A FORTUNE
What is YOUR job in the business ? Work or Grow ?
“You may think that the day to day activities of
your business are vitally important, but most of
the time they are things that Business Owners
can hire people to do”

17. Remember, everyone in your
business has a job and the
business owner’s job is to be
a leader with the vision and
plan to keep the business
growingAs a rule of thumb, if you can afford to
pay half of a new employee’s salary, you
should hire them. With proper training,
they will work to pay for the other half
or their salary and more.

18. 3. THEY HIRE THE WRONG TEAM
Do Proper Due diligence
“Employees are generally quite happy
and motivated...
except for the 8 hours at work “
Jim Rohn
More often than not, small businesses hire people
they know or family members without
giving consideration to their respective qualifications.

19. 4. THEY FORGET WHAT BUSINESS THEY
ARE REALLY IN
“When your business is based on discounts,
guess what kind of customers you’ll get ?
YOU’LL ONLY GET DISCOUNT CUSTOMERS.”
Customer Acquisition and
Customer service business !!

20. Simply put, without great
customer service, you will never
have great customers and
without great customers you can’t
have a great business.

21. Don’t discount – add value!
• Added value with soft R cost
• Package offers
– Low margin products with high margin
products
– Slow moving products with quick moving
products
• Bonus offers: Buy one get one free (BOGOF),
”spend R50 and get R5 off your next purchase”
• Time limited offers and discounts
• If you do offer discounts
– Relate them to early bird payments or shorter
credit terms to safeguard your own cashflow.

22. 20% 25% 30% 35% 40% 45%
2% 11 9 9 6 5 5
4% 25 19 15 13 11 10
6% 43 32 25 21 18 15
8% 67 47 36 30 25 22
10% 100 67 50 40 33 29
12% 150 92 67 52 43 36
14% 233 127 88 67 54 45
DISCOUNT
%
Current Margin
%
Have to Sell
50% More

23. 5. THEY DON’T USE TARGETED MARKETING
“Even a marketing giant like Mc Donalds has
a limit to who they can market to.
You don’t see too many McDonalds ads on
the food network or channels geared
toward healthy living”.
What about Coca Cola ?

24. If you focus on just one market and one
campaign, you may be successful, but there is
also a
major possibility you may crash and burn. that’s
why you need multiple campaigns
When you focus on multiple markets targeted
through multiple campaigns, one, or more of
them, are sure to work
Building Wallet share, rather than
Market share

25. Thank you
Any Questions?

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