Business Education

How Business Owners can Deal with Bad Managers

There’s a plethora of advice for how to deal with bad managers — from an employee’s role. But, little is out there about how to deal with a poor manager for business owners. Entrepreneurs rely on a number of other individuals to make things happen. Everyone onboard is supposed to be onboard as a team. Sadly, there are times when a manager’s style is counterproductive to the larger organization. Fortunately, there are some effective ways entrepreneurs can deal with bad managers.

Bad Managers Undermine Good Employees

You’ve probably heard the old computer software cliche that “garbage in equals garbage out.” Meaning, if the right ingredients aren’t entered, the output will totally reflect its input. This same sentiment goes for your company’s team members. If employees have the right management leadership, their performance will reflect it. However, if that leadership is poor, you’ll get poor results.

Bad management can impact employees and a company’s overall operations. Incompetent managers exist, and they can have challenges relating to staff members and keeping them motivated. In addition, substandard supervisors may not be able to balance budgets, increase revenues or capably perform other crucial tasks. —Houston Chronicle Small Business

It’s a bit more difficult to manage a manager than it is an ordinary employee. Largely because these individuals are experienced and used to managing others — but not necessarily themselves. So, it’s entirely possible for them not to see their own flaws and shortcomings. If an employee under him or her doesn’t produce the right outcomes, a bad manager believes it’s because of the employee and not himself. Of course, this is circular logic and the situation will only worsen over time.

3 Effective Ways Business Owners can Deal with Bad Managers

The good news is there are ways to get a wayward manager back on track. (Or, reform a bad manager into a good steward of their team members.) Here are three effective methods business owners can use to deal with bad managers:

Identify their weaknesses. Okay, this goes under the “obvious” category. But, it’s something that simply cannot be ignored. By getting feedback from your employees and observing him or her in their official capacity, you can pinpoint his or her weaknesses (and strengths). Then, work with them to formulate a plan to help them overcome their weaknesses and rely more on their strengths. Don’t be overly critical. Instead, speak about their shortcomings in a transcendental way and emphasize their strongest traits.
Always strive to set an example. Here’s another bit of obvious — but absolutely necessary advice — always strive to set an example. After all, if you run the company like the infamously bad side of Steve Jobs (who was reputedly a ruthless and hard-driving boss), expect the same behavior from your manager(s). But, run your company as a benevolent yet firm boss and your manager(s) will most likely follow your cue. When you make a mistake, own up to it and do so honestly and humbly.
Give him or her public praise when deserved. This is difficult because it could easily backfire in a number of ways. Still, it’s necessary to bestow praise when and where it is due to encourage others and to foster a sense of unity. Of course, you can’t just praise your manager(s), you must also do the same for your employees.

What other suggestions do you have for dealing with bad managers as a business owner? Please take a moment to share your thoughts and experiences so others can benefit from your unique perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

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What to Do When You Lose Your Biggest Client

July 29, 2021 No Comments

Losing any client is a blow to any business owner. But, it’s particularly troubling when it’s the largest paying customer your company has a working relationship with (or had at one time). While it’s disturbing for any size client to stop doing business, it’s an absolute crisis when it’s the single largest one. Or is it? The answer really depends on how you handle the situation. So, read on to learn more about how to deal with losing your largest client. Seize the Opportunity Entrepreneurs are usually able to identify opportunity when it presents itself. But, in cases where there’s a tentative failure or bad fortune, it can be very difficult to see it and act upon the moment. Sure, it’s a setback and this makes it quite hard to get past the shock. However, the sooner you spring into action, the better. (Though don’t mistake this for making rash, uninformed decisions.) Whether you’re a Fortune 500 company or a small mom-and-pop business, losing a massive client is always shocking, uneasy and frustrating. Unfortunately, it’s something that almost every entrepreneur experiences at some point in time. —Forbes.com Instead, take a step back and give yourself time to form a generalized overview, one that’s not out of panic and fear. After all, it’s far better to take an honest assessment and determine precisely where you stand in order to determine exactly what actions are necessary in the short-term. This way, you’ll make informed decisions that are based on reality and not trepidation, anxiety, and alarm. 3 Ways to Deal with Losing Your Biggest Client Losing a big-time client is a real reason for concern. However, it’s also not an excuse to give up and close your doors for good. There are more than a few things you can do to prevent significant damage and/or start building new streams of revenue. Here are three of the most effective strategies you can use after losing your biggest client: Expand existing business relationships. The easiest way to make up for the difference is to leverage your existing business relationships. After all, current customers are the easiest ones to deal with and the most obvious place to double down. Since you have an existing relationship, you can offer more products and/or services to them and that will get you through in the short term. Take the opportunity to expand offerings. This is also a prime time for expanding what you offer to the public. This is a great opportunity to expand your business by focusing on your most popular selling items, whatever these are now and in the near future. Prevent the same situation from happening again. Of course, you probably don’t want to go through the same ugliness again at any time in the future. So, make sure to develop strategies that prevent this type of loss from happening again and you’ll gain a better sense of security. What other suggestions do you have that might be of help? Please share your thoughts and experiences by commenting so others can benefit from your perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

How to Set Business Product and Service Prices

May 16, 2017 No Comments

Pricing products and services is difficult for any new business owner. Though it might seem to be a simple equation, that’s hardly the case. There are quite a few factors which go into setting your price or prices. Even within industries that buy from manufacturers to sell directly to consumers, there are variables from one vendor to another. Location is part of pricing, not just distance, but also demand and population. Services aren’t much different in this respect. Let’s say that you’re a dietitian, and you work with various doctors, hospitals, and gyms over a large geographic region. You travel quite a bit, so you go from big cities to rural communities. Chances are excellent you’ll charge more for your professional services in the metropolitan area than you will in sparsely populated rural areas. How to Set Business Product and Service Prices One important aspect to keep in mind when setting prices for goods and/or services, is they are promises to your customers. A price reflects value and consumers are careful about which products and/or services they choose. This means that price, while a very important factor, isn’t the only consideration consumers take into account when purchasing. For instance, a big bag of individually wrapped chips complete with select flavors is priced for $6.99. Next to it is a generic store brand priced at $4.99. Based solely on price, you’d opt to save $2 and go with the store brand. After all, you’ll save money and the chips will taste the same. Price is the most important factor in determining profit. Yet countless businesses fail to get their pricing strategy right. The price you charge for your products or services is directly related to your Cost of Goods (labor & materials to produce the product/service), your overhead and the competition or demand. Your focus needs to be on your desired Gross Margin. Price is a major way you communicate your firm’s value in the marketplace. Yet many small business owners set prices arbitrarily or sheepishly follow the crowd. —Bloomberg Business Now as you wind your way through the grocery store you visit the meat department. Inside the display case there are four ready-to-cook hamburger patties made mouthwatering with fresh bacon bits and cheese and is priced at $12.49. Right across the aisle in the frozen section there’s a 10-count box of plain, frozen hamburgers for $9.99. Suddenly, saving $2.50 doesn’t seem worthwhile and you splurge because the fresh, mouthwatering ready-to-cook hamburgers are simply irresistible. The point, of course, is perceived value — you’ll have to base your business’ product and service prices on their value. However, that’s just one factor of many others which go into pricing. Here are some steps you can take to help you set the right price: Learn about demand in your area. No matter how wonderful your product or service might be, if there’s no demand for it in the area, it won’t sell. Think about the old sales joke, “Selling ketchup popsicle sticks to customers in white gloves.” Obviously, people wearing white gloves have no need for such a mess. The same holds true for demand in your area. If you’re selling snow shovels, it’s should be to consumers in climates where it snows. Check out competitors’ pricing. This is a simple way of learning what consumers will pay for a product or service. Of course, you should only rely on established prices by flourishing businesses. Always factor-in costs. There’s no getting around the fact that it costs money to run a business. Even freelancer contractors have operating costs. For brick-and-mortar operations, there’s rent, utilities, insurance, inventory, employee pay and benefits, and other costs. Be willing to discount. One way retailers sell products is by offering discounts. This is a great strategy, if it doesn’t wipe-out your margin, or it’s a one-time deal to establish a relationship for future business. Don’t undercut simply to attract business. A big mistake that some new to business make is to undercut competitor pricing, only to learn the hard way they can’t deliver. After all, it does no good to attract business if customers aren’t receiving what they expect. Pricing is a science and an art. The science is an equation based on your Labor + Materials (Cost of Goods) divided by your desired Margin or divisor. If you desire a 40% Gross Profit Margin (the amount left over after you cover your Labor and Materials), then your divisor is 60% and not a 40% markup. Using a 60% divisor based off your Cost of Goods will yield a 40% Gross Profit Margin. A mistake many businesses make is to mark up their Cost of Goods which yields a lesser Gross Profit Margin closer to 28%. We call this “Profit by Accident”. Because it is feasible to guarantee your business makes a profit, we developed our “Profit by Design” strategy. Contact us for a complimentary consultation to review your pricing strategy and learn more about “Profit by Design”. Now, what about the art of pricing? The art is in the research, testing, creative marketing and demand for your product or service and how you promote its value. The art is in your ability to pivot and massage all of the components (labor, materials, overhead, marketing, value, customer perception, etc.) to work together. Combined, you will develop a pricing strategy that proves out in your bottom line profits and more money in your pockets! Pricing is a delicate balance, but with some research and a bit of critical thinking, you’ll be able to set prices for your business’ products and/or services. Do you know and understand your pricing strategy, or is yours Profit by Accident? [shareaholic app=”follow_buttons” id=”26833294″]

Managers should Avoid these Phrases to Avoid Killing Employees’ Trust in Their Leadership

May 5, 2022 No Comments

When it comes to the workplace, trust is key. Employees need to trust their managers in order to feel comfortable taking risks and be productive. Managers, in turn, need to trust their employees in order to delegate tasks and give them the freedom to make decisions. Unfortunately, many managers say things that damage this trust relationship. So, let’s discuss five of the most common phrases that managers use that kill employees’ trust. Words can Speak Louder than Actions Managers should avoid the following phrases in order to maintain a trusting relationship with their employees. Trust is essential for a healthy workplace and these phrases can damage that trust relationship. Employees need to feel comfortable coming to their managers with questions and concerns, and they need to know that their manager will be open and transparent with them. The employee-manager relationship is one of the primary components to a strong organizational structure. Employees rely on their managers for career development and guidance on how to improve their skills. One of the elements of a successful employee-manager relationship is trust. When the sense of trust is strong between an employee and manager, it adds efficiency to other elements of workplace productivity. —Houston Chronicle Small Business When managers use these phrases, it sends the opposite message. It makes employees feel unimportant and disregarded. It creates uncertainty and frustration, which leads to a lack of trust on the part of the employees. And that, of course, results in a negative impact on morale, productivity, and overall company culture — three poison pills that can cause actual, long-lasting damage. Five Phrases Managers should Avoid to Avoid Destroying Employee Trust We’ve all heard the age-old wisdom about sticks and stones breaking bones but words never inflicting harm. Of course, this philosophy is entirely contextual because we all vividly remember instances when words cut deep. While these phrases aren’t intended to insult or hurt, they nevertheless undermine your authority, respect, and relatability. So, avoid using the following phrases because they will slowly kill employee’s trust: “I’m the boss, I don’t have to explain my decisions.” This phrase is incredibly damaging to trust. Employees need to feel like they can come to their managers with questions and that their manager will be open and transparent with them. When a manager uses this phrase, it sends the message that the employee is not valued and that their opinion does not matter. It also makes the manager seem like they are hiding something. This can lead to employees feeling uncomfortable coming to their managers with questions or suggestions, which can hurt productivity and morale. “I’m too busy to deal with this right now.” This phrase often comes across as dismissive and unprofessional. It sends the message that the employee’s concerns are not a priority and that their manager is too busy to deal with them. This can make employees feel unimportant and disregarded. It can also lead to them feeling like they are not able to come to their manager with problems or concerns, which can hurt morale and productivity. “I’ll get back to you.” This phrase often comes across as ambiguous and frustrating for employees. Employees want to know what is going on and they want answers from their managers. When a manager says this phrase, it sends the message that the employee is being ignored and that their question is not important. It also creates uncertainty, which can lead to employees feeling anxious and stressed. “I’m not sure, let me check on that.” This phrase is often used as a way to avoid making a decision or taking responsibility. It sends the message that the manager is not capable of making decisions and that they are not in charge. This can make employees feel like they are not being taken seriously and that their concerns are not important. It can also lead to frustration and a lack of trust on the part of the employees. “That’s not my job.” This phrase communicates that the manager does not care about their employees or their job responsibilities. It sends the message that the employee is unimportant and that their job is irrelevant. This can lead to employees feeling unvalued and unmotivated. It can also cause them to feel like they are not able to come to their manager with questions or concerns, which can hurt morale and productivity. Which other phrases would you include in this list? Please take a moment to share your thoughts and experiences so others can benefit from your perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.