5 Tips to Get Your Company to $1MM Per Year

I've spent the last several years working with small and medium-sized businesses. Many of them were failing. Some had issues in finances. Others had simply wanted to grow and wanted to know how to do it. Every single one of them wanted to reach rarefied air - to have a million dollars in revenue a year. This is a pretty sweet spot for owners to be in - only about 15 percent of companies in America are making this kind of money. But you also have to drill down much deeper into the data in order to really understand what this does and does not mean.

Everyone business owner wants a million dollars a year. If you made a million dollars a year, you'd be within the top 1 percent of earners in America. But to drill down farther into that, in the year 2011, there were only 236,883 people earning $1,000,000 or more a year. I don't know about you, but that sounds pretty unrealistic to the average American. Over 312 million Americans, and less than 1 in 1350 make that kind of money. You only have slightly better odds than if you were to get hit by a meteorite.

BUT, if 15 percent of companies can do over a million dollars a year in sales, that's only 1.5 out of ten companies. That's incredibly doable. And with a capped 15 percent corporate tax and the right set-up, owners could conceivably make $850,000 out of it. That kind of number is enticing. But let's be absolutely realistic - take home pay should never be the goal of a business owner. Don't let the zeroes in a bank account blind you to the truth. You are going to have to WORK for it.

These five ideas can make it much easier for you to get there.

KNOW YOUR PRODUCT'S VALUE

I hear this one all the time. "Why the world do I need to know this? I've owned my business for a few years now!"

Simply put, knowing your product and its value is a simple sales tool. If I build a machine that costs $1 million dollars in my garage, and then I sell it, I have $1 million in sales, overly simplified, of course. A simple farm tractor, which sounds common, can sell for up to $400,000 to the right farmer. A typical MRI machine, common in hospitals across the world, can run well into the millions. By contrast, 20 full pounds of copy paper can run as little as $15 for reams of pages. Even the staff at Dunder-Mifflin wouldn't have a hard time selling that!

The cost of the product isn't the point - it's knowing how many you have to sell. Often, my clients are like - DUH, we know that. But really understanding that selling that product is your company's LIFEBLOOD doesn't necessarily sink in. Business creep, the daily activities that a company does to operate, grows as a company gets larger. A medium-sized company might have ten employees, only four of which have to do with the regular operations or sales. But sales is sales - whether the product is thousands or $15 - you have to know how many you have to sell in order to make your goals!

One of the biggest problems that I see is that owners lose track of the most important parts of their business - knowing their value. As a service provider, I don't sell paper or tractors. I write business plans, provide strategy road maps, constant coaching to business owners, and creating projects and programs to add depth to a company's offerings. A $500 business plan doesn't seem like much, but knowing all the reasons for a business having one is why the $500 is a steal for the average business owner. That project the owner needs done might be $10,000 or more, but the cash flow it permanently generates is priceless to the company. Me knowing all of these things makes expressing those values to others a simple exercise in finding needs and fulfilling them.

Moreover, sales is a NUMBERS game. I know that for every client I pitch and sign to a contract, two to four will decline. It's my key indicator. It's one of the simplest strategies for a growing business to tackle. If I sell every third person on a $50,000 project that my company can do for them, I need 20 people to say yes in order to do $1MM in revenue. That means I need to get in front of 60-80 business owners in order to do so. Boiled down into a yearly number, that's barely one a week. That's not exactly hard to do.

You walk into thirty businesses a week without even realizing it. You go to the gas station, the store, your own company, you walk past that accounting office next door and the insurance company down the hall. How many of those people could you sit in front of on a daily basis, that need your product? Forget the power of selling on the internet. Now that the entire world is basically connected in your pocket, the playing field for entrepreneurs has been completely leveled.

When you can stretch outside your comfort zone, you'll realize - as a business owner, just pitch EVERYONE. Yes, my wife is really tired of my pitch...

PLAN YOUR ATTACK, ATTACK YOUR PLAN

Oh man, the Army used to beat us over the head with this cliche, so badly that you'd groan and be like, "Can we get to work already?" I used to HATE it. 150-person plans used to take hours in front of a model, a map, or something similar. We'd have back up plans to the first back up plan, a contingency if everyone was dead, and five different radio frequencies. Once, they even gave us smoke signals, SMOKE SIGNALS! Guys, if everything's on fire, something's not right!

However, when I got to the business world, I saw the good common sense of having such plans - because SO FEW PEOPLE HAVE THEM! Seriously, about one in three businesses that I visit or work with doesn't have a solid, coherent plan to work with! Many business owners are boot-strappers - they started working on some hobby, and someone came along and started buying their good or service. They never actually THOUGHT about making it a business - it just happened. My wife is a perfect example of this. She took a childhood sewing hobby that she and her mother did together and used it for relaxation and therapy after her mother died. But then she started discovering rarities and identifying others that collected them and coveted them as much as she did. She made friendships and started finding and selling them. But she never thought it was a BUSINESS. PayPal last year sent her an invoice for all of her income, and she nearly died when she saw how much she was making! It was more than her regular job.

But she never actually sat down and mapped out a business plan. That's where I came in, with a lot of fighting and suggestions, since she listens to me just about never! So, we worked in a simple organizational plan. We got her accounting software (free from TurboTax if you use it for business tax filing!), got an accountant friend to check on her periodically. Nothing super involved, but she's now about to double her highest sales year ever. All it took was a small road map and a constant check on the course direction. A good plan is a great start.

Also know that your plan is going to fail. SOMETHING is going to happen that makes your carefully planned assault go completely haywire. In the Army, it's usually the radio. The movie cliche of the radio not working? Yep, that's because it happens in real life, too. In business, you had to get those 5000 donuts delivered for the school bake sale on Monday. But it's Saturday, and your sugar supplier is four days late with your bags. They forgot the gluten-free flour mix, and you can't give them the 750 allergy-friendly donuts that they requested. Not to mention, the school is throwing an entire week-long event highlighting your donuts as a main supplier and local brand. Welcome to a massive problem.

None of the marketing and optics on a complete failure is going to look good. And in the digital world, people are going to find out about it. Someone drove three hours to your restaurant, just to find out you ran out of the brisket they wanted? Welcome to a hideous Yelp review! Someone didn't like the Renaissance paintings on the ceiling that were drawn by a super-famous artist because the cherubs were naked? TripAdvisor is going to torpedo your ratings. Yes, I've watched all of these happen.

How these businesses succeeded was in the actions they had to take after all the bad publicity happened. The donut company gave vouchers to each kid, as well as threw them a gluten-friendly party exclusively for them. The kids felt valued, and the parents raved about the idea all over social media. The barbecue company owner personally delivered several pounds of brisket in the company truck, as well as brought a full picnic for the entire church congregation. The restaurant owner set up a private table out in the grass, so the family could come in and eat in a quiet location by themselves, even though they had no patio seating available. Solving the problem went a LONG way to fixing their goodwill.

DO WHAT YOU'RE GOOD AT, HIRE OTHERS TO DO THE REST

One of my favorite clients is a contractor based out of Denver. He got his license and works mostly on kitchen remodels for local friends and family. He was having a problem with his business, not because it wasn't working, but because he wanted to make more revenue and didn't have the time to see all of his projects to completion. One request would lead to four, which turned into ten, which got incredibly busy as he was trying to complete projects while the requests and referrals kept rolling in.

It took me twenty minutes to see where he was shining - he loved the personal interaction with others. Our 30 minute called turned into 90, as he was trying to figure out how to add more revenue. He loved the sales calls, the check-ins with contacts, the smiles of happy customers. Yet, the hours of labor required to resurface and refinish kitchens was a drain on his energy and time away from sales.

A quick rework of his business structure was needed. He had a lot of subcontractors that he wanted to work with and hire, check their work, and bring in if he needed. Which worked perfectly for him. He could sell the projects and the need, be the contact, and let others finish out the work. The markup for his service as a project manager was added to the prices of the contractors. He'd check the final products, keep the clients happy, and spend his time where his energy worked best - with his natural talents and extroverted personality on display. An office manager handles scheduling and budgeting, an accountant keeps the business organized and legal, a foreman handles materials and delivery coordination. The business is currently soaring.

Finding complementary people to your own skill sets are the most important foundations of a successful business. My consulting team has talents in areas that I can only dream of succeeding. Marketing and data analytics might be completely foreign to me, but a successful team needs both, along with people that love those roles. One of my team is fluent in both Spanish and Portuguese, and her ability to explain to local clients our services is reaching markets I'd never be able to penetrate on my own. I may not know exactly how they're doing the smallest details, but their knowledge and experience constantly refreshes how and why I do projects for companies.

DON'T GET TOO FAR OUTSIDE YOUR COMFORT ZONE!

A good friend of mine has owned her own company for a few years now. She didn't start the company by choice. She was one of the most successful HR representatives for Amazon for years. She was rising quickly, with several promotions within three years. But she told me, she HAD to quit. I thought she was crazy. When she told me why she left, not only did I understand it, I would encourage it in others. She left the role because it wasn't true to her inner monologue anymore.

She started her company almost by accident. People would constantly contact her about how to get in Amazon. "How would you write the perfect resume? How do you get through the interview process? How do you get around the algorithms? What's the perfect thing to say to the recruiter?" People would send over their resumes and ask for tips. She was so flooded with the requests, she had gotten completely sidetracked from her initial goal to get back into HR for another Fortune 500 company. A company was born.

Three years later, she still writes resumes, for a price that is totally justified by her experience and awesomeness. She personally coaches hundreds of students across America, incorporates them into a group where positivity and humanity are at the center of job searches. She helps navigate the world of networking and teaches people how to get through the broken system of HR.

All of her offerings come from a single place - she helps thousands of people find the perfect job, the perfect boss, and how to negotiate the perfect salary. When I asked her if she would consider secondary products, she replied "Only if they fit with who I am and what I do." She tests thousands of hours and test subjects to get the perfect extension of her personal brand.

This lesson comes truly hard for others. One of my construction clients recently came to me with the idea of getting into manufacturing. He had data points, ideas, and every single good positive thing to say about exactly why he needed to proceed with this plan. He had already put in an order for the equipment and the parts! He even came to me and asked if I would help him get it up and running. I said, "Nope!" Short and simple. "It's not what you do."

He hemmed and hawed about it, and it took several of his employees speaking up for him to realize - this was a total pivot from where his business is. A book printing company doesn't turn around and start producing crops for farmers. It isn't their message, which is "Books are awesome, read this guy's expose on foreign affairs." You don't turn around and say, "We build your dream kitchen AND print t-shirts for your soccer team!" Those ideas not only compete with each other, but they split your focus, time, and money.

TAKE CALCULATED RISKS!!

Risk is inherently something we as business owners understand. We aren't guaranteed a paycheck, anymore. We have to put in the work and make sure that every little penny and pound that we spend is accounted for. We have to buy materials, supplies, and so many other things. We aren't guaranteed to sell the finished product of any of these. But we buy them anyway.

Another good friend of mine lives in Hungary. His family was outgrowing their house, and they needed something better for the kids. As a non-Hungarian, it's extremely hard to buy property in Hungary. There are a myriad of government hoops to deal with, lingering relics of the Communist-era that still persists today. But the family needed a house, so he put in the paperwork to buy one. He started to find the lawyers, the real estate agents, and began to work on buying the house. It could take months to get approval, so he wasn't exactly in a hurry. They found a small farmhouse not far outside of the town he was living in. His small locally own and operated consulting firm was doing modestly, and he could afford to be patient and put down a down payment on it. So he started waiting.

However, the government came back extremely quickly. Much faster than he was ready for. Sure, they said, you can buy the property. But you have to buy it out-right, with no financing whatsoever ever. It's the only way your family can buy the house you wanted. That was money he didn't have.

So, being the extreme entrepreneur that he is, he went to WORK. He started mining contacts in Europe and America. He asked for referrals to friends with companies of their own. He started posting adds all over the internet, paying for them on advance services. He offered his consulting services and contacts to literally hundreds of people. If clients would pay upfront for his services, they'd get a discount on the entire amount. And he would cover all of his own expenses, which is a fairly large concession in the consulting world. Just wire the payment through PayPal, and he'd start cranking out his work.

Boy, did it WORK. Not only did he pay the entire amount of the house within a few short weeks, he had enough surplus cash, work, and connections that he could start working on his dream - a multinational speaking and consulting company in the EU and America. Today, he attends conferences and seminars on several continents. He speaks at military entrepreneur seminars and takes two-week retreats with business friends to places like Peru and Tanzania, where they work on their businesses while experiencing nature's glories.

The man took a serious risk, and then he backed it up with some serious sweat equity. I like to remind entrepreneurs that we might be natural rebels, we may not fit in comfortably where people don't want us asking questions. But we start our own companies when we aren't afraid to take a risk! If we are willing to gamble on ourselves, we should be willing to gamble that events will conspire to help us reach our goals. Moreover, we take ownership of our lives in almost every aspect. Success can be a powerful motivator!

In retrospect, none of these solutions are incredibly difficult to execute. It requires a decent plan, a little ingenuity, an awful lot of hustle, and some Luck. But if you're prepared to sweat, love what you do, and know that everything you ever wanted was on the other side of fear, you're prepared to make your company successful. Success is worth more than a million dollars, but starting there means your company can really achieve your wildest dreams!