The Biz of Pacelinebiz

Turning things on end to achieve results!

Business Lessons Are Everywhere

leave a comment »

Slow But Steady Costs Time And Money

Slow But Steady Costs Time And Money

Today I write about another business lesson that played out in front of my eyes without even looking for it. I find that these are the best kind of lessons, if you can recognize them. As I was cutting my grass on Memorial Day weekend I noticed that my neighbor was getting his grass cut by a crew of two people with push lawn mowers. The whole time I was cutting my lawn I was thinking about this and decided it would be a worthy topic to write about.

The two-man crew took at least an hour to finish the job and I would estimate they could have cut that in half had they had a riding lawnmower. This problem was so basic that I had to stop and comment to my wife about it. Apparently the first problem they have is inadequate access to capital. This best thing they could do would be scrape together $500 and buy a used riding lawnmower. The pay back on this capital expenditure would be very fast.

Let’s look at the numbers. If they can cut an additional three lawns per day at $30 per lawn due to this equipment upgrade ($90 more per day) it would take about 6 days to recoup their initial investment. The extra cost of gas for the riding mower versus two push mowers is assumed to be negligible. They already had a pickup truck that would fit the riding mower as long as they could figure out how to build a ramp to load and unload it.

As I was running the numbers in my head while finishing up my lawn, I envisioned myself becoming an Angel investor for the company. I would buy the riding mower and the two-man crew would cut my grass until they satisfied their debt. It would only take about 17 weeks at $30 a week to complete the repayment. After the 17 weeks, the mower would be theirs with no interest charged. If they were able to find the additional three customers they would now have time for each day, the extra $90 daily revenue would amount to an astonishing $11,700 more in revenue during a 26 week mowing season.

I realize this is an extreme example, but can you take a similar step that will move your business to the next level? Business is risky and there is no such thing as a sure thing but risk does get rewarded. Perhaps it is time to step out and risk a little for a great potential reward. At one point you took a risk and started a business – where has that spirit gone?

Have a great week.


Written by pacelinebiz

July 7, 2014 at 8:01 am

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: