I Regret to Inform You… Your business’s shotgun approach is sucking it dry.
- Harry T. Jones
- May 1
- 3 min read
Remember the premise of this series?
Most of us have received letters that begin, “I regret to inform you…”
Sometimes this kind of news arrives in other ways.
A bank covenant violation. A stack of unpaid vendor invoices. A cash flow statement that doesn’t add up—no matter how many times you run the numbers.
For the business I’ll call Joseph’s, the letter arrived quietly, buried in a decade of impressive revenue growth.
Nobody sent it. Nobody signed it.
But the message was unmistakable:
I regret to inform you… this business’s shotgun approach is sucking it dry.
Over the last decade, Joseph’s business grew from $10 million to $50 million in revenue.
Impressive, right?
You should know, it’s a cash hog.
The bank covenants are violated—meaning the business can no longer meet the profitability requirements to service its loans.
Vendors aren’t being paid on time.
And the leadership team? They are happy. They constantly celebrate the revenue numbers.
What? There is a disconnect here…
The sales force goes after every door that swings.
Every opportunity.
Every customer.
Every market.
If it looks like a sale, they chase it.
And the entire compensation structure rewards exactly that behavior—new revenue, new accounts, new sales.
Nothing about profitability.
Nothing about sustainability.
Nothing about the customers that actually make the business stronger.
They quintupled their revenue.
The result: The company is nearly destroyed.
I regret to inform you, a business without a healthy niche and the discipline to defend it is a cash hog.
The Question That Changes Everything
We’ve been asking this question of every business we work with for years:
What can your business do better than any company in the marketplace—and be rewarded for it?
That’s your niche.
Not what you can do.
Not what you have done.
What you can do better than anyone else and get paid well for doing it.
When I posed this question to the leadership team at Joseph’s, something interesting happened.
I asked them to show me the profitability of each account. When we laid it all out, we discovered they had 19 profit centers. The profitability of each of those centers should add up to the total profit of the company.
They were losing money.
Then I asked: What’s your process for evaluating new customers? What are the capital expenditures required, and what’s the payback period?
“About 30 months,” they said.
“How often do you measure that?”
Silence.
“Well... that’s what we think it’ll do.”
They weren’t measuring the financial sustainability of their customers. They were chasing revenue and hoping the math would work out.
It didn’t.
What a Turnaround Expert Taught Me
I once asked a friend—a man who has invested in turnaround situations for 30 years and does incredibly well—what he looks for when he walks into a struggling business.
His answer was immediate:
“How are they doing in their core business niche? Have they identified it? And are they still strong in it?”
He said the second thing he looks for is their core culture.
Not their revenue.
Not their growth rate.
Not their market share.
Their niche. And their culture.
Because without those two things, everything else is just noise.
Three Questions to Ask Yourself Today:
What can your business do better than any company in the marketplace—and be rewarded for it? If you can’t answer that in one sentence, you don’t have a niche yet.
How do you measure the profitability of each account? Revenue is vanity. Profit is sanity. Do you know which customers are making you stronger and which ones are sucking you dry?
What are you rewarding? If your compensation structure rewards revenue and nothing else, don’t be surprised when your team chases revenue and nothing else.
The Good News
Just this morning, I was on a call with a founder who has turned the corner.
They are now evaluating every single new opportunity on a cash-flow-positive basis. Before they say yes to a new account, they ask: How can we make this relationship profitable from the beginning?
That discipline is changing everything for them.
It’s not too late to make the same shift.
What Can You Do?
If you’re ready to define your niche and stop the cash drain:
Get in a Succession Planning Breakthrough Group where other founders are wrestling with the same questions—and finding answers
Read Succession Planning for Impact to understand how defining your niche protects your legacy
Work through Succession Planning for Impact (The Workbook) to identify where a lack of niche focus may be derailing your transition
Sign up for our private email list for ongoing insights on building a business worth continuing
The best time to define your niche was when you started the business.
The second-best time is today.
Don’t let the shotgun approach rob the next generation of what you’ve worked so hard to build.
Let’s finish well—together.
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