Why American Businesses Fail

I’ve been doing a lot of traveling lately for a secret project. In fact, I’ve spent the last three days in Colorado visiting Denver, Colorado Springs, Boulder, Littleton, Aurora, and Brighton.

Now I’m taking off for Miami and the surrounding areas for the next three days where I’ll be doing more of what I was doing in Colorado – stopping into a half dozen or so fitness centers, private gyms, boot camps, and training studios to meet with their owners, and figure out why their businesses are failing and losing money each and every month.

So far, and without fail, every single one of the locations I’ve visited have shared the same story…

And it’s the same story you see in all types of businesses across America, from jewelry stores to independent plumbers, and from restaurants to construction companies.

The business owner often started off small with low overhead and they did alright for themselves.

They built a good client base, they grew into their own modest location, and before long they had visions of grandeur and wanted a bigger facility with more staff, better equipment and with all that comes higher costs, bigger payroll, and without preparation or planning their profits literally fell off the cliff.

In every one of these situations the owners of these businesses spent way more time on their fancy logo, the design and look of their facilities, selecting the equipment, and nowhere near enough time on the four key elements to ensure that their business would grow, profit, and serve their lifestyle.

Now they’re stressed, over worked, and broke…

If only they’d invested some time and energy into these four simple things to guarantee their success.

1. Marketing and lead generation.

I’m not talking about making a cute tri-fold brochure, flyer, or a fancy business card and calling it “marketing”.

I’m talking about active direct response marketing that takes place outside the four walls of your business on a consistent basis, and gets folks to call, email, or walk into your facility.

2. Sales and conversion.

Not a single one of the businesses that I stopped by had a predictable, proven, or systematic sales process to convert leads and prospects into paying clients. Even worse, when I asked what their closing percentage was or what the average client lifetime value was, they were clueless.

You can’t improve what you don’t measure.

3. Client retention.

Of the six businesses I visited in Colorado only one of them had a process for tracking client results and showing it off throughout her facility. But that is an essential step for success and can’t be ignored.

The rest of the locations I stopped by failed to offer an initial client introduction to the business, didn’t gather testimonials, and worse, didn’t encourage their clients to take the next, crucial step that can literally make or break a business.

4. Referral generation.

I nearly lost it when I asked these owners what their best referral generation strategies where and they’d say they didn’t have one. None of them made the effort to make referral generation a condition of doing business.

None of them ran referral generation contents or programs to encourage their clients to refer their friends, family, and co-workers.

It crushed my heart to see these awesome business owners who I knew were passionate about helping people live better lives struggle to make ends meet.

I could tell they were stressed and in way over their heads.

What’s worse is that it seemed like they had given up trying. It’s like they had accepted the fact that there was no hope for their business to recover from the mess it was in, when in reality every single one of these business are easy to fix.

Some needed a lot more “work” done than others to get their business back on track, but every single one of them could be dealt with in a systematic and formulaic fashion. It’s not rocket science, I’m sorry.

They could all be saved, turned around, and made massively profitable. But for that to happen, these business owners needed to wake up, stop feeling sorry for themselves, and take massive action on the stuff I teach them.

As I write this email I’m reminded of the 27 Fit Body Boot Camps owners I met with last weekend in San Diego at Craig Ballantyne’s Turbulence Training Fitness Summit.

We spent a whole day together in a makeshift mastermind meeting talking about how to improve their business – and at the end of the day both John and Cara Eckerman (Chino Hills and Brea Fit Body Boot Camp owners) texted me when they realized that not a single one of the Fit Body Boot Camp owners in that meeting had a marketing, sales, retention, or referral generation challenge.

I didn’t realize that either until John and Cara brought it to my attention.

The majority of their business challenges were logistical… how to structure staff meeting better… how to structure their boot camps to accommodate more clients… how to deliver the nutritional information to their clients more efficiently… and how to create a waiting list and intake process for all of their leads that they got after running a deal of the day promo and our FBBC 1000 Pound Melt Down Challenge™

These are good problems to have.

See, all business will have problems and challenges. But I’d much rather have logistical problems that have to do with growth and expansion verses marketing, sales, and high overhead costs.

I don’t know where you are in your business. Maybe you’re just starting out, and if you are then let this be a lesson to you; marketing and selling trumps a fancy facility and sexy logo any day.

If you have your own business – in any industry – and you’re doing well but have a vision to grow your business bigger, let me ask you this…

Are you bursting at the seams with happy customers? Are you getting new clients every day? Do you have a marketing system in place? Do you have a systematized sales funnel?

If not, then why do you want to grow into a bigger location?

Are you getting the most profits that you can from your current business?

Is there room to raise your rates, to cut costs, and to improve efficiency in your product or service delivery?

Do you know how much it will cost you to move into, renovate, and run your new location?

Do you have internal, external, and online lead generation systems in place?

The fact is that anyone can get a loan and open up a fancy new business with a shiny new logo and catchy name.

But it takes a real entrepreneur to start smart, sell and market like a professional, and relentlessly control your overhead costs – that’s what builds a business that will generate strong profits and deliver you real wealth for your future.

I challenge you to look at your business – or your career – and make sure that you are a master of the fundamentals first, before going after any of the fancy, ego-driven aspects of a business like a larger location or sexy logo.

As Mark Ford taught us, be a “chicken entrepreneur”. Start small, produce profits, and systematically grow your business, and you’ll avoid failing like so many of those other businesses in your neighborhood that seem to come and go like the wind.

I assure you, success is not rocket science. If I can do it, anyone can do it! I came to this country in 1980 and couldn’t speak a lick of English. I was placed in the slow-learner classes in school. I didn’t make it through college. But I realized this…

Success simply requires following in the footsteps of other successful people that have come before you. So as a young man, I found a successful business mentor and did exactly that.

As I told those businesses that I visited last week, if you look to the masters of the past to get the direction for your future, that’s how you will achieve your American Dream.