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Business Advice

What High-Performing Businesses Have In Common?

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The Australian economy has dealt some hard blows to business owners recently. High inflation rates, tight household budgets, ATO relief payment clawbacks.

But what if you want to maintain your business performance and continue your path to growth despite all the upheaval? It is not an unrealistic goal. Other businesses have achieved this in the past.

How do you ask?

A few typical aspects of successful businesses may have contributed to achieving optimal business performance in a challenging economy.

It’s important to note that these traits are general and may not be suited for every business model or industry.

Book a consultation with Clout Advisory’s Business specialists for advice tailored to your circumstances.

Traits Of High-Performing Businesses

1. Diversified Revenue Streams:

Relying on a single product or service can be risky as all your income depends on that one thing. A healthy business seeks to diversify its offerings. You may have a specific niche you are catering to, but are there different needs within that silo? Would it be possible to cater to a broader audience?

For example, a carpenter may specialise in custom chairs. But they can offer an extensive range of different styles of chairs to accommodate their customers’ tastes.

Alternatively, they could expand their skills to other pieces of furniture and attract customers looking for different things but still within their range of expertise.

Partnerships are also a great way to diversify your business revenue stream. In the above example, the carpenter could partner with an upholstery business or someone who can install stained glass into pieces.

Sharing the load and diversifying mitigates the impact of economic downturns on one income stream.

2. Strong Financial Foundations:

Money is the lifeblood of every business organisation. It keeps the business heart pumping. No business can reach its full potential without adequate accounting processes that provide vital financial information. A solid economic base with manageable debt and sufficient cash reserves provides a safety net during challenging times.

A solid financial foundation consists of proper administration, debt management and cash flow mechanisms.
Most high-performing businesses have a good accountant who can save their business money and ensure that it runs efficiently and meets all current rules and regulations.

3. Agile Decision-Making Processes:

Adaptable businesses can quickly respond to changes, pivot strategies, and capitalise on emerging opportunities.

One of the critical components of a healthy business is being an effective leader in the industry.

A growth mindset underpins all high-performing businesses. What made yesterday a success won’t win today’s market; learning and improvement are essential to sustained success.

A great example of this is V8 Juice. In the early 2000s, the company faced intense competition in the fruit drink sector, with competitors such as Tropicana and Minute Maid. Their crucial difference was having eight fruits and vegetables in every drink. So, V8 was repositioned as a way consumers can increase their fruit and vegetable intake and gain the success you may recognise them for today.

4. A Customer-Centric Approach:

A high-performing business never loses sight of a critical operational function: to create and keep a customer. Prioritising customer needs and building lasting relationships fosters loyalty even in uncertain times.

Keep an eye on those highly profitable and low-maintenance clients who become brand advocates. Please get to know this customer intimately, regularly engage with them and consistently seek their feedback. This informs your decision-making for product and service expansion, employee competency, process efficiency and output quality.

Having the whole business ethos centred around the client will magnify the personalisation and satisfaction felt by the customer. Reputation and social clout can make the business an industry institution.

Strengthen customer relationships through personalised experiences and effective communication.

5. Innovative Culture:

A culture encouraging innovation and continuous improvement helps businesses stay relevant and competitive.

High-performing businesses invest in training to continue to develop their employees’ skills and adapt the workplace to meet the needs of their employees.

Healthy businesses never stop learning or evolving and continue improving by moving with the times and concentrating on what is needed to help their employees achieve their goals.

They make decisions in the best interest of their employees and business and assemble their best team to achieve their goals.

The company culture extends from the people hired to how they are trained and involved in the business and the processes and procedures that guide everything they do.

6. Efficient Operations:

Streamlined processes minimise waste, reduce costs, and enhance overall efficiency. High-performing businesses can identify risks early and ensure effective strategies lead to solid KPIs.

Identifying risks early and seizing opportunities will be key components to running a healthy business.
Key performance indicators (KPIs) can be used to measure the effectiveness of operations. How long does a job take? How many can you complete in a specific period?

Whenever your objectives are unmet, you need to start to analyse and adjust the specific process. By analysing the metrics for business performance, you can spot any issues that need to be addressed to meet your goal.

Furthermore, you could identify areas where resources can be optimised without compromising quality.

High-performing businesses understand the power of their employees – they can make or break an organisation. The right people in the right places doing the best possible processes will run the business like a well-oiled machine.

7. Flexible Strategies:

Going back to the V8 Juice example. They started in 1933 and were mainly used for Bloody Marys, as the recipe was 87% tomato juice. As the times and consumer needs evolved, so did the strategy of V8 Juice. They were a nutritional staple during WWII and played on the name as a source of ‘power’ when V8 engines were the hype during the 70s. V-Fusion and Energy drinks are expansions of the enterprise as the population’s tastes change over time.

To do this, all successful businesses closely watch market trends and anticipate shifts that could impact business. Data is essential to strategic planning. Good data not only tells the history of your business but also lights a path forward.

You can compare data of the same product or service from last year to now or compare different products and services to each other for the same period. However, there must be a consistent measure of data to compare and accurately analyse trends.

Please find out how to identify trends in our previous blog.

Is Your Business Performing Well?

The view that a healthy business makes a profit is antiquated. It takes much more to create a sustainable business in the current climate.

If you objectively view your business, do you share some of the above traits with high-performing companies? If not, use them to build resilience into your business.

Know your strengths and weaknesses. Restructuring your business may assist in increasing performance and bolstering the individual aspects that contribute to a healthy business.

Clout Advisory can be an unbiased partner working to build your business and achieve your goals. Clout Advisory provides hands-on support from an honest performance evaluation to a strategic plan forward.

Contact us today to hear how we can help you.

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