“Think about what else you can do to generate a new revenue stream, because at the end of the day, a viable business is one that produces revenue,” Vaughn said.
Diaz recommended that they do a business plan. “You need to do some strategic planning, to find qualified people and get more time off for yourselves. You need a business plan: What do you want to happen in six months? In five years? You have to apply that plan to a small business in order to become a medium business.”
Rappa said they will seek SCORE’s help in developing a plan.
Review the business model
Rappa and Runkle said they are trying to grow their business by offering contractors equity positions. They give each contractor half of the pet sitting fee. If the contractor grows the business and hires a sub-contractor, then each gets a cut. The SCORE team recommended they review the business model for profitability.
“If you are charging one fee, then paying a portion to each contractor as you go down the line, you’re not making any money,” Diaz said. “It is diminishing returns.”
Vaughn said if they change to an employee system, they could set up standards of customer service to preserve the brand and pay using a different model.
Rappa and Runkle said they will look at the different options for growing their business, and decide what makes the most sense for them.
Find a reliable workforce
“Your first priority should be to expand your staff,” Diaz said. “The customers are there. You need to increase your capacity to serve them.”
Runkle and Rappa had initially hired younger workers because they thought that demographic had the energy for the job.
But they found the younger workers they tried weren’t reliable. “They don’t respond to phone calls, or they don’t show up,” Runkle said.
The SCORE team recommended looking for workers in an older, more stable demographic, and to those who have flexible schedules and a better work ethic. They also suggested contacting vet schools to find students who already want to work with animals.
After the initial meeting with SCORE, Dee’s Dogs took on two more full-time contract workers, a college student who loves dogs, and a middle-aged woman who had previously owned her own business.
“They have a good work ethic,” Rappa said. “We always thought ‘No one can do it as well as we can,’ but now we’re seeing that they can.”
The couple needs to assume more of a management role as their company grows, the SCORE team advised.
“The business is growing, and it’s taking up all of your time,” Diaz said. “But you have to deal with sales and operations, you have to act like a CFO and CEO.”
The couple needs to create a plan for financial operations and marketing “and look at things more objectively,” Diaz said. “You have to evolve from this stage to the entrepreneurial stage.”
The couple also should outsource more of the day-to-day duties, and decide what roles they want to take on personally, Vaughn said. “As we learn to delegate, we learn to let go,” he said.
Runkle said it’s difficult because there is a constant flow of work. “We have people who need us to walk their dog every day,” Runkle said. “We have people who leave on vacation every week.”