Just like most of you out there, I own many different types of investments with different rates of return. Some of them do well, while others are not so hot. The poorer performing investments are periodically changed to better ones (in theory) so as to increase the returns on my portfolio. I do the same sort of review on my businesses, though I am more likely to change the systems and not sell the companies.
Now, I do these business reviews at least once per quarter, if not more frequently. The major warning sign I look for is if the company is not turning any real profits – or put bluntly, costing me money. If the company is taking money out of my pocket, it is time for a drastic change – without profit my company cannot survive.
So, I take a look at the profit systems that are in place and tweak them as necessary. Sometimes you can go from a loss to a profit from just changing the way you do things – and that is what I am looking for.
This has also become a habit for me – once I have one business making a profit, it is time to add another.