“Every man must be tempted, at times, to spit on his hands, hoist the black flag and begin slitting throats.” – Henry Louis Mencken, American Journalist
The other day this quote came to mind after I discovered that due to a filter that was set up by a former employee who had been fired, a good percentage of inbound leads were being filtered and therefore NOT called or properly followed up on. Ugh. I HATE losing money…and this, folks, is a “mistake” that has been taking money out of my pocket for a few months now before I discovered it. I’ve swiftly and aggressively responded to this and have been watching it like a hawk until we get 100% of the inbound leads accounted for and followed up on. I’ve designated two people on my team to fix this immediately and have personally been pulling and reviewing leads until I’m satisfied we are squeezing 110% of the juice from every lead that comes in. Sloth or sloppiness in the sales department will NOT be tolerated or I shall hoist MY black flag.
Of course, this is not how most would respond to such news. They’d shrug. I often find similar “holes in the bucket” of MSPs and their response is “Meh.” C’est la vie. Shite happens. Is it any wonder they’re not growing profitably? One MSP came to me for advice on how to make his website perform better. After testing the opt in form on his home page, we discovered not only was the lead going nowhere (meaning he wasn’t being notified and it was NOT going into a CRM) but it also went to a broken “template” page that still said, “Insert Company Name Here.” I asked him how long it was like this. He said, “At least 2 years.” Two years? TWO YEARS? You never ONCE checked your website in TWO WHOLE YEARS? I don’t even have the words.
Another client hired me to review his marketing to try and figure out why he wasn’t getting any leads. After just a little digging around – for about 20 minutes – I discovered his full-time telemarketer was NOT calling on inbound leads, referrals and other opportunities given to him. We found leads given to him printed out and stuffed in his desk drawer, abandoned. Again, no CRM in place, no checking. How long had this guy been there? Over 6 months. 6 friggin’ MONTHS!!!! A GIANT hole in the bucket.
As the saying goes, you get what you tolerate. When you allow sloppy, slothful performance from your employees, your marketing and your money invested, you DO pay a price – but what’s stunning is how mildly people react to this.
Any business – YOUR business – is an investment device where dollars are put into play, exiting the organization and RETURNING with more, with the goal being that more come in than leave, thereby accumulating equity for the business owner. As Kevin O’Leary says: “Here’s how I think of my money. As soldiers. I sent them out to war every day and I want them to take prisoners and come home so there’s more of them.” Whether this happy incident occurs or not with any kind of consistency depends largely on how prudent and determined YOU are to be efficient in the operations and accountability of the money.
A dollar invested can also return minimized to $0.70 or $0.50 or not at all, due to ignorance, stupidity or even a risk taken that didn’t play out. How swiftly and aggressively you respond when this happens tells me everything I need to know about your ability to run a business productively. As Warren Buffet famously said, “Rule #1: Don’t lose money. Rule #2: Never forget rule #1.”
In many businesses, loss is happening with wild abandon in multiple categories, from gross overspending on outsourcing for convenience’s sake (I don’t like the idea of hiring a telemarketer, so I’ll outsource it), to time theft of employees who come in late, leave early and take LONG breaks; willful non-compliance of set protocols and standards by the staff; lost customers that go missing and no one notices; and employee and vendor theft. The list is long.
But the one area in business where it’s most rampant is in the marketing and sales departments. Inbound leads and referrals that are not captured in a CRM and properly followed up on take money out of your business and subtract from your personal wealth directly. Sales not closed due to sloppy and nonexistent systems do the same, as well as reduce profitability and your personal equity. Worse yet, NOBODY is tracking or monitoring any of this. I’ve seen this going on in HUNDREDS of businesses. They’re dumping untold amounts of money into NEW leads and NEW clients and NEW marketing without putting an equal amount of money, time, effort and thought into expanding the spend of existing clients…or working unconverted leads a bit more creatively, aggressively.
If half of these losses are mitigated or stopped, recapturing those dollars, it can quickly equate to half a million to a million or MORE in a year’s time, even to a smaller MSP. I’ve proven this math repeatedly, showing very logical and fact-based conservative models where plugging the multiple holes in the marketing bucket can allow for double-digit growth without doubling the cost and investment. Don’t zip by that one – it’s important. But what do most do when I show a conservative model of how tightening a few follow-up and sales screws make in dollars? Absolutely nothing. They continue on, doing business as usual.
Now that we’re in a recession that I and many financial analysts foresee getting a LOT worse before getting better, you must tighten every screw, plug every hole and shore up every crack and crevice money is leaking out of. We’ve had nearly 10 years of money running uphill, with 2019 being a stellar year for MSPs, given the Windows 7 end-of-life gift. Now we’re in winter, folks, and leads, customers and dollars are going to be harder to come by, requiring a more diligent and conscientious effort to getting the most out of every lead, every sale, every client and every opportunity.
If you want to learn how to find “hidden” money in your MSP that doesn’t require a heavy investment, then be sure to join me at this year’s Recession Rescue Roadshow For MSPs. One new tool I’ll provide is a hidden money map to your MSP business that will, without a doubt, reveal ways you are allowing profits to slip right through your fingers.