It’s time for the Nero’s notes review. I wrote about the importance of reviewing projects here.
As the rain is pouring down, this seems a good time to hunker down and get into the weeds.
Nero’s Notes Review
Neros Notes is a trading style of Loggedoff Ltd. The company began trading in February 2017. To date, I have taken no salary and the company has lost money each year. Ballpark figures, the company lost 40k in Year one, 11k in Year 2 and looks like maybe a 5k loss in the year to end in January 2020.
Not exactly Apple or Amazon, is it?
I had hoped the company to be cash generative in Year 3, and it looks like it won’t quite make it. However, the trend is going the right way and the target now is to be generative in 2020-2021. Hopefully, the company can begin to make a dent in the loans that I have injected to provide working capital.
Sales are growing and we are getting better at managing costs. There is no silver bullet, it’s all about incremental wins both in revenue and cost.
Over the next six weeks, I’ll be sketching out a plan for the next three years and a budget for the next twelve months.
The plan is broad-brush, a framework of ideas and a vision of where I want the business to be in 12, 24 and 36 months.
The budget is more detailed. I start with the “knowns”, the fixed costs, and then start making estimates for the other numbers, based upon the previous year. The Nero’s Notes review now becomes the Nero’s Notes strategic plan. Here comes the magic. I identify some areas to improve. What can I focus on that will yield measurable improvements to the bottom line? I do this in stages, and on paper.
First, I write as many possible actions as I can.
Facebook ads. Instagram ads. More blog posts. Videos. More collaborative marketing. Lower office rent. Lower labour costs. Find alternative suppliers…
No analysis, just brainstorming ideas.
Next step is to start considering each action, and to do so with an open mind. I’m wary of dismissing ideas out of hand. The whole aim of this process is to think differently from the norm. Many of the ideas will be pruned. I want to get the list down to somewhere around 1 to 5 things that I’m going to do. In my experience, doing one thing well is much more effective than splitting my focus across multiple improvements.
I flesh out each initiative, thinking it through with pen and paper. This is messy, and involves lots of crossing out. I’m testing the idea, stretching it, breaking it.
This process goes on over several days, until I have fixed, trimmed and tested initiatives on paper.
What I do with them? I’ll cover that next week.