What’s under your hood?

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Spiderman (Madame Tussauds London).
Spiderman (Madame Tussauds London). (Photo credit: Wikipedia)

No. I’m not referring to any activities as caped crusader. What I’m referring to is your business engine. When last did your business have a checkup?

We’ll take our motorcars in for a regular checkup, let the motor mechanics run diagnostic tests on our motor vehicle and gladly pay for anything that they may find wrong with our car. When you have little or no access to public transport, you rely heavily on your motor vehicle. It’s not only the danger of breaking down late at night but also these days in broad daylight. A breakdown in a crime-infested area can lead to massive problems or even untimely death.

One woman who I met told me that she only drives a specific brand of car because she knows it’s reliable. She religiously has her car serviced and her tyres changed so that she has maximum reliability and safety. It’s not only that she’s worried about breaking down at night or on a country road but it’s breaking down during the day in the city where anything could happen.

Whilst all business owners will willingly take their motor vehicles for a checkup to find out what’s going on under the hood they rarely are open to business diagnostic tools to check if there is anything wrong with their big business engine.

Why is this so? Well, it’s like a lot of things. If we think everything looks fine, we not too bothered what’s going on inside the business. But early detection of possible major problems can save you a lot of headache and heartache. How are you going to feel when something suddenly goes wrong such as a default on a payment by your biggest customer? What will it feel like when you get a knock on the door and it’s the sheriff of the court.

What really is a business checkup? How do you go about it? Why should you do it?

As a start-up or small business owner you need to know the health of your business. You need to have at least an annual checkup to see how your business is doing, whether you are growing and doing the right things or whether your business has some serious ailments and if you are at risk of your business engine stuttering or, worst of all, breaking down.

A small business diagnostic assessment will typically look at your management capability, commercial performance including cash management, your product or service, the market that you are targeting and your competitive position including external things that might affect you such as government regulations and licensing requirements.

It might be that the area in your business that needs attention is your sales and marketing. This is really the engine that drives your business and can always be optimised and improved. Without a regular stream of sales, you don’t really have a business at all. Linked to sales, is your marketing plan. As we know many small businesses don’t have a formal marketing plan but rather some vague notions in the head of what they may or may not try out. Yes, there is no doubting that word-of-mouth is the best advertising and referrals from satisfied customers is your best form of promotion. But you can’t continue to grow your business, especially when faced with competition, on word-of-mouth alone. Market estimates and sales projections derived from your assessments of the size and growth of the market ultimately determine your sales potential.

These days a business assessment is not some nice-to-have chat over a coffee but is a deep analysis and checkup of the most important areas in your business and where the risks and opportunities can be identified. Any business adviser worth their salt will give you a 20 point or even some a more than 50 point checkup of the most important areas and help you on your action plan.

“How much is this going to cost?” I hear you asking. Let’s look at it this way: it’s probably going to cost you less than your 10,000 km or 15,000 km service for your car but in many cases the cost of not checking your engine under the hood of your car could mean the loss of everything in your life including your business and all your major personal assets.

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