CNBC's The Profit has been something I've been tuning into for the last few of years. With the upcoming season looming (November 21st) Here are the three main takeaways I have from the show to date, in no order.
Know Your Numbers
This goes without saying, however, it is truly amazing how many people really do not know their numbers. This seems to be something so elementary, yet so many small business owners have a mindset of if they build it customers will come. The number of times I have seen Marcus challenge people on their financial forecasts is amazing to me. Even if you get lucky and have a killer product, that doesn't mean success.
The Three Ps
One of the fundamental lessons of "The Profit" is that of the central importance of the three Ps: people, processes and product. Lemonis emphasizes that all business problems – and successes – can be traced to one of these three aspects. He notes that a critical component of a successful business is making sure that all three P's are functioning smoothly and at peak efficiency. In one episode, Lemonis talks about the importance of investing the necessary time and expense to make sure that your people are properly trained to perform their jobs competently and smoothly.
The product pinwheel is not necessarily new to the world of fashion, nor is it new to the world of tech. Steve Jobs refocused Apple on his return from Next by "Getting rid of the crappy stuff." He reduced the numbers of SKU's the company had dramatically and streamline their offerings.
He presented this in the form of a product pinwheel much like Marcus discusses with fashion labels. However, Marcus though presented it with more clarity to me. He wanted the designer that he was working with at the time to focus on who the customer was and what they were trying to do rather than trying to sell garments.
As a product maker, this is a highly important lesson take note of. We can't worry about building something to sell. We must understand who we are selling to first to guide ourselves through the process of making critical decisions.
Thanks again Marcus for the free education that you and your show have provided us entrepreneurs and making it entertaining in the process.