Cloutier - Profits arent everything, theyre the only thing: no-nonsense rules from the ultimate contrarian and small business guru

Profits Arent Everything, Theyre the Only Thing!

End Denial

Forget Sweat Equity

Love Your Business More Than Your Family

The Best Family Business Has One Member

Delegate, Dont Abdicate

Live and Die by a Real Plan

Pay for Performance

I Am Your Work God

You Are Not in Business to Pay Your Vendors

When Filing for Bankruptcy Is Your Best Option, Do It Early!

Dont Treat Sales Like Your Mother-in-Law

Give Up Golf, Retreats, Off-Sites, and Trade Shows

Teamwork Is Vastly Overrated

Its Not the Economy, Stupid, Its You!

Y OUR SALES ARE DOWN. Your operating costs are out of control. Your cash flow has slowed to a trickle. Your bank wont give you a loan. Of course you blame the economy. Everyones suffering, so its no wonder your business is in trouble. Right?

WRONG!

Dont blame the economy. Recession or no recession, if your small business is failing, its your fault!

Sure, we all take hits in downturns. But if youre struggling, if you cant turn a profit no matter how hard you try, if youre slicing your salary or facing foreclosure, its because youve been doing something wrong all along. Take a good hard look under the hood and youll see that most of the problems in your small business are internal. But guess what? Thats good news! That means the situation is not beyond your control. It can be fixed! And Ill show you how.

It wont be easy. Im about to tell you some tough truths. Get ready. My advice is controversial and uncompromising. I wont flatter you, I wont humor you, and Ill never let you off the hook. Think of this book as a wake-up call thats long overdue.

My company, American Management Services, has been working to turn around Main Street businesses just like yours for almost three decades. Theres nothing we havent seen and weve rarely encountered a situation we couldnt fix by rolling up our sleeves and getting to the root of the problem. This book will give you the benefit of our collective wisdom and experience. But first, one important rule: No more excuses!

If youve picked up this book, youre probably already running your own small or midsized business or thinking about starting one. Maybe youre expanding and wondering about your next step. Maybe youre doing okay, but your competitors are doing better and youre wondering if you could be doing more to increase sales. Or maybe youre like hundreds of my clients, who suddenly find, along with everybody else, that the tide has turned and the ship of easy profits has long sailed. The hidden problems in your business arent so secret anymore. All those tough decisions youve been shoving to the bottom of your to do list are finally glaring back at you, waiting to be made.

Whatever your unique situation, the next steps to take are all here in the pages that follow. But before you read on, you have to make a decision. You have to ask yourself, Why am I in business? Whats my goal?

Your answer should be to make profits.

Why get into business if not to make as much profit as you possibly can? If you just want to be comfortable, go find yourself a secure job where you can punch a clock, pick up a paycheck, and hope for a great pension. If you want to contribute to society, found a nonprofit organization. But, if entrepreneurship is in your blood, why not work for the most that you can get?

The truth is, one of the many reasons people go into business on their own is because they are not happy where they are. Few say they started a machinery shop or a hair salon because they wanted to be a billionaire. They just thought they could do it better than their bosses did, and they wanted to enjoy life a little more. But if you dont have the controls and processes in place, youre just going to put more weight onto your shoulders. Far from gaining more control over your own life, you lose it, and become a slave to the staff and vendors you have to pay to keep the business alive. But theres a solution to this, a way to regain control: put Profits First, always!

Im not going to lie to you. Making a real profit takes unwavering dedication to your business. When I travel the country giving seminars sponsored by Partner America, a strategic alliance I co-founded with the U.S. Conference of Mayors to promote and develop small business, I have each member of the audience fill out a questionnaire. The most important question I ask them is this: On a scale of 1 to 10, how hard do you work? I get a lot of 8s and 9s. But Im always amazed at how few people say 10. I tell them, if they didnt check off 10, theyre not working hard enough. Thats why theyre not making money.

Challenge yourself to do better, even if it means coming in on Saturdays and Sundays. You can go fishing any weekend. But the time to make a profit is always now. Business is not complicated. It all boils down to how hard you work, and how smart you work, in good times and in bad. Do more. Get more. And be ruthless in your quest to make money.

I know its rough out there. According to the latest numbers by the Small Business Association, more than a million businesses are expected to file for bankruptcy this year. We may well be in the midst of the worst recession any of us will ever live through and no one knows how long it will last, or how much harder it will hit.

I remember in May 2008, five months into the official start of the recession, when Council of Economic Advisors Chairman Edward Lazear said, The data is pretty clear that we are not in a recession. Oops. Guess he was wrong. And economists are often wrong about whats really important to our nations economy. Even though this nations 23 million small businesses are the backbone of our regional and local economy, employing more than 60 million people, creating 70 percent of new jobs each year, and generating about half of our GDP, many economists have no clue about the realities that small businesses face.

Whats been happening on Wall Street infuriates me. When I see how the big banks, and AIG, have been making money off your backs and giving out multimillion-dollar bonuses for sheer incompetence, I want to stand up and scream, Why didnt you fire these people?! I want to organize a Million Small Business Persons March on Washington to demand the impeachment of the incompetent bureaucrats, who were supposed to be overseeing our financial system. Whats been happening on Wall Street and in our government is a disgrace! Washington should be putting controls on the billions in bailout money theyve been giving companies that have flagrantly abused our trust. And the government should be giving you, the small business owner, access to loans at 2.26 percent, just like theyve been giving the big finance houses. This countrys small business owners create 74 percent of all the jobs in this country. Its your investment, your sweat, and your dedication thats going to get this nation back on its feet. Of course you should be getting more help!

Its a lousy picture, but one of the biggest dangers of an economic downturn is the excuse it gives small business leaders to lie down and do nothing. You can say to yourself, Everybody else is struggling so I might as well go home at five and get in nine holes of golf before dinner. Or you can ask yourself, Do I really want to commiserate with all the other losers on the ninth holeor do I want to make a profit?