The big picture matters

Published by Travis Newton on June 5, 2018 in Business. 0 Comments Tags: .

One of the things I dislike about large business is that it’s about the previous and current quarter. You’re comparing Week 1 of the current quarter to Week 1 of the previous quarter and then to the same quarter of the previous year. It’s true that you have to know where you came from to know where you’re going but the big picture still matters.

It’s easy to get obsessed about quarterly numbers but if you’re focused on that, you’ll lose sight of the vision. What I say I think applies more to small business than large, but Amazon has retained the same vision since day one and that is focusing on growth more than anything. In the 1997 letter to shareholders, Jeff Bezos wrote the following (emphasis mine):

It’s All About the Long Term
We believe that a fundamental measure of our success will be the shareholder value we create over the long term. This value will be a direct result of our ability to extend and solidify our current market leadership position. The stronger our market leadership, the more powerful our economic model. Market leadership can translate directly to higher revenue, higher profitability, greater capital velocity, and correspondingly stronger returns on invested capital.
 
Clearly, this has worked for Amazon. From 1997 until 2002, Amazon did not return a profit. Instead, they focused on becoming a leader in the market which drove an increase in sales and then the company became profitable in 2003. For the vast majority of companies, this is not how they operate. They look at the smaller picture and then strive to make the current quarter more profitable over the next and they do this in very sly ways. It’s not my place to “name and shame” but if you keep your eyes open and ears to the ground, it’s easy to see. For example, there is one major company that owns some popular places. One of the things they do to boost revenue is they introduce something they hope people will purchase near the end of the quarter – but it’s not every quarter. It’s the quarters where they know they need something to give a boost over the last quarter. So you can go to one of their destinations and rent something fancy for $300/day (and since the introduction of this rental product, they have since dropped the price over 200%, furthering my thought that it was simply a way to boost numbers). When did they introduce this rental product? Near the end of a quarter.
 

Keeping the perspective

When you begin to focus on small picture stuff, you’re looking at brush strokes. Let’s take this to a figurative example. Last quarter, we painted the red square. This quarter, we painted the green square.

You can tell that in the first quarter, we did a lot of blue and some yellow and then in the second quarter we focused a lot on the blue. You can of course substitute these colours for products or services. But are we making progress? Are we positioning ourselves to be a work of art? In my opinion, no. You’re focusing on the wrong parts of the painting.

What happens when we shift our views to “the big picture?” Well, let’s look.

Now that we have the full picture, we can be more productive. Perhaps this is being a market leader. Or launching a new revolutionary product. We break up the picture into chunks and then we work on each chunk until we complete the goal. Looking at the big picture isn’t a bad thing. Ideas change and sometimes we end up changing the masterpiece in the end but that doesn’t matter. No matter if your art ends up being a van Gogh  or a child’s finger painting, the truth of the matter is you met your goal and then it’s time to work on the next big picture item. I will always look at the big picture – the idea I have – and then I will figure out a way to get there, one chunk at a time.

The importance of small business

Published by Travis Newton on May 16, 2018 in Business. 0 Comments Tags: .

I am a small business owner. I own a small tech company called Xinsto and we’re a managed services provider for other small businesses. One of my passions is encouraging people to shop small, shop local. However as much as I preach it and as much as people support the idea, not everyone follows through.

The importance of the local enconomy

One of the biggest factors overlooked is that when you shop local, use local vendors, you’re keeping your local economy healthy. When you keep your local economy healthy, you’re making a big impact. The first is jobs. You hear politicians constantly trying to get businesses to their towns but do you know what happens when a large company moves in? Sure locals are employed but the revenue generated by that local branch office always goes back to the headquarters, sometimes in another state. That other state reaps the benefits more.

When money is spent locally, it drives more businesses to open and existing thrive. This grows towns and local economies. For example, the larger Xinsto grows and the more team members we hire (we don’t use that “e-word” but I’ll discuss that in another post), the larger office space we need means more money to our landlord which means they can invest more into building more space for businesses such as artisan shops, specialty stores, delicious local restaurants and that means more for locals.

We operate in an area that is seasonal. Majority of our customers make their money May through November. But the more money we add to the local economy promotes new housing, new jobs, and more year-round enjoyment. It’s a win-win for everyone!

The downside nobody wants to hear

Unfortunately, one of the downsides to small business is that what we charge does cost more. That botique clothing store doesn’t have the same purchase power as a major department store. Since they can’t buy in large quantities, prices are higher with a razor thin margin. That margin is how they pay rent, pay employees, keep the lights on, and take enough home to pay their bills too. After all, we are people just like everyone else.

Another downside is that they have people who wear multiple hats. They might have a receptionist who has to double as a hair stylist. Some of these skills can easily be transferred. What I run into a lot of though is the receptionist who also has to double as the IT person. This is where our managed services really come through. When I go to a customer location and find things in a really bad state, I show the value we offer. We have the skills small business don’t hire for and we do it cheaper than what it costs to hire someone.

Small business for small business

This is why I love doing what I do. Today, businesses have to be technology focused. Their customers expect a website. Owners need a POS that keeps track of inventory in real time. Sometimes offices have networks so mismanaged that they just think technology is slow and accept it. That’s not the case.

Businesses we work with discover all the time that now their employees have time to do their jobs. Their systems are secure and compliant (PCI-DSS for anyone who accepts credit cards for instance, which is nearly every company). They end up saving money.

Remember, shop small, shop local, and give us a call for a free consultation.