(pick one answer):
-Straight line.
-Circle.
-Military operation.
-Fluid.
When I ask people to define a business using a graphic symbol most come up with some sort of chart with a steady upward trend in revenue, using a straight line. Most businesses never attain this ideal of consistent, measured growth.
Business is fluid. Like water it seeks its own level and fills lower elevations with its presence. A series of puddles that eventually form a pond, then a lake, and finally a river that ends up at the source, and ocean of opportunities.
Like all nature the ocean has an ebb and flow. The receding and rising tidal waters are cyclical and natural. The same is true of a business. It follows a natural ebb and flow. It is much easier to go clam and crab picking when the tide is out, and it is the best time to harvest clams and crab because they are much easier to catch. The same is true of a business: there are times when you have to work much harder to get the same results because you often cannot wait for the tide to change. Answer this question: What is the natural flow of the business you are interested in purchasing?
It really does not matter what your answer is to this question; the point I want to make is that if you pay attention to natural ebb and flow of the business, yo will be able to shift and adjust your strategy.
If you are out of sync with the natural ebb and flow of a business, you will spend valuable resources when you have the least chance at success. It is like gambling with the odds significantly weighted against you.
TIP: You can put the odds in your favour by paying attention to natural changes and business cycles.
For example, resource-based economies follow a 10-year boom-and-bust cycle, while service based economies follow a 4-year boom-and-bust cycle. During a bust cycle yo will need to change your strategy and tactics to see the current economic and business realities.
Identify the signs of change in the business yo are being. Find out what the impact to the business will be. Create a strategy in advance to cope and adjust with the boom and bust realities. If you feel you are coming out of a bust, plan ahead to add resources, inventory and staff. If you think the boom has busted, it is time to reduce expenses. Take time to evaluate what you can do without or how you can eliminate expenses.
