Pawn Shop Advisor Blog

Measuring Success

Over the weekend I received several interesting replies about the message I sent out about the aggressive and innovative carwash owner in my area. I hope you enjoyed this message and understood its underlying theme. That being, any business owner will benefit greatly from keeping their eyes open and seeing what new ideas they can implement and apply to their business - no matter what type of business the idea came from. But one reply I got on this message was different - very different.

I believe you may benefit from what was asked, and I will reply to this lady pawnbroker below. She wrote to me and stated:

"Steve, I usually enjoy your e-mail tips, including the one about the carwash. But because of it I feel the need to ask you a question. You say this business owner is highly successful because of the amount of federal income taxes he pays. This annoys the hell out of me. Is this how you measure success? Profits? Income taxes? I'm troubled by this. There are more important things in life. Anita G."

Dear Anita, Thank you for letting me know how you feel. First of all, I did not intend to annoy you or anyone. I apologize. However, my answer to your question may surprise you. You asked if I measure success in profits. The answer is no. But the answer is also yes. I measure BUSINESS success in profits. This is the only intelligent metric by which you can measure the success of any small business. But in doing so, you need to keep something in mind.

Keeping track of profits in your business is your best way to keep score on the health and success of the business. There are however many different types of profits. Any top-notch accountant can make a fabulously unprofitable company seem profitable. So if you're keeping track, track all of the real profits. Not just the ones on paper. Business owners should keep in mind salary, bonuses, contributions to retirement accounts, health benefits, retained earnings, investments, and also increased equity in their business. This will keep your pawn shop business healthy. This is also an accurate measurement of your business success.

In my mind, and I believe also in yours, personal success is a totally different story. I would never measure someone's personal success by the number of zeroes in their bank account. Nor would I measure someone's success by where they live, the clothing they wear, the car they drive, or where their kids go to school. That being said, I am not annoyed if this is how they choose to measure their own personal success. It's not my business - it's theirs.

It's also not my business how anyone else chooses to measure someone's personal success. People view success in different ways and we are all entitled to our opinions. But I can sum up how I choose to measure my own personal success in one word. Generosity. Through my eyes, being a generous person is the number one quality of being a successful person.

I feel strongly enough about this that I have discussed being a generous person with many pawnbrokers over the years. Some who I have discussed this with feel my point of view offers conflict within the profession. I have had some in our trade tell me that you can not be a successful pawnbroker by being a generous person. I disagree. I'm both.

By being a generous person, I'm not saying that I'm overly liberal with my pawn shop customers. I've always treated business as business - and this is something you should always try to keep in mind. But by being more successful in business - through profits - I can be more successful personally - through greater generosity. The hole you give through is also the one you receive through. But you should never give with the expectation of receiving back.

I hope this answers your question and I thank you again for your comment.

By the way, if you were a client of mine with the Pawn Shop Advisor(tm) http://www.pawnshopadvisor.com/main.cfm coaching program, you would have already known exactly how I feel about this. In the "Back Room Systems" section of the program, I have included my six step prosperity system. Needless to say - generosity is one of these steps.

Keep your eye on the target and your mind on the goal,
Stephen Krupnik

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