In today's fast-paced world, speed is more than just a competitive advantage—it's necessary. In the relentless race of business, if you're not moving fast, your competition will. Consumers demand speed in this era of instant gratification, and companies that fail to deliver quickly are often left behind. This article is a tale for modern times, exploring why speed is crucial in business.

Do you remember Aesop's fable "The Tortoise and the Hare"? 

Well, we all know, but let me remind you.  One day, the Hare bragged to the other animals in their pack: "No one can beat me in speed," he said, "I challenge anyone who can run as fast as I can." The Tortoise, with his characteristic calm, replied: "I accept the challenge." "Great!" exclaimed the Hare, laughing.  "Don't brag until you win," replied the Tortoise.  So, the course was set, and the race began.  The Hare ran like lightning: he was almost invisible and so far away.  Then he stopped and – to show his contempt for the Tortoise - went to sleep.

Meanwhile, the Tortoise was barely walking, one step at a time. When the Hare woke up, he saw that he was close to the finish line. So, he ran as fast as he possibly could, but the timing was not on his side, and it was not able to win the race. The Tortoise smiled and said, "No need to run; you have to start on time."

This story is instructive in several ways: first, if you set out to do something, do it and then rest; second, speed matters, and 999 times out of 1000, the fastest wins the race no matter the fable.

But have you ever heard of the 72-hour law?  

This law refers to effective time management and goal achievement.  It means that if you have an idea or a project, you have to take at least one step towards its realization within 72 hours of the idea. Otherwise, the chances that you will realize the idea are significantly reduced. This is a stark reminder of the high stakes in business and the crucial role of speed in seizing opportunities. 

Without speed, the chances of succeeding in business are significantly reduced. If you're reading this, you know exactly what it means to manage the business.  If not, I suspect that you are not yet an entrepreneur or are just starting out and making decisions.  The main idea of business is to make money.  

To earn $50,000 net per month in business, the average sales required is $50,000 / 0.085 = $588,235. In 2000, the average net profitability for small businesses was about 5-7%. This means that in order to make a net profit of $50,000 per month, the business would need to have sales of approximately $714,286 - $1,000,000 per month. In 2010, after the economic crisis of 2008, the average net profit decreased slightly to about 4-6%. 

To achieve the same net profit target, the business would need to have a turnover of $833,333 - $1,250,000 per month. In 2024, the average net profitability for small businesses in the United States is approximately 7-10%. This means that to earn a net profit of $50,000 per month, a business must have a monthly revenue of approximately $500,000 - $714,286. This means that now is the best time, because to earn the same $50,000, you need a lower turnover than in all previous years. But you must put it in 5th gear and not just watch someone else's business grow. 

For those who are still in doubt about whether to increase their business turnover, here are some statistics.

Statistics of Business Closure for Large and Small Businesses during 2020-2024 (COVID-19 Pandemic)

Small Businesses: In the early months of the COVID-19 pandemic, since January 2020, approximately 34% of small businesses in the United States have closed. Cities such as San Francisco were particularly hard hit, with up to 48% of small businesses closing. These statistics serve as a sobering truth reminder of the need to learn from past mistakes and adapt to changing circumstances in business.

Large businesses: For large businesses, the closure rate increased from 1.3% in 2019 to 2.7% in the second quarter of 2020. While this rate is significantly lower than for small businesses, it still reflects the significant impact of the pandemic on large businesses.

Reasons:

Small businesses: Significantly higher closure rate due to reduced financial stability and limited access to credit.

Large businesses: Although large businesses were also affected, their ability to adapt and the availability of reserves allowed them to avoid mass closures similar to small businesses.

Looking for resources to get your business off the ground? Do you have an idea that needs access to funding? Are you ready to run fast like a Hare and confidently like a Tortoise to achieve the desired level of business profitability? Well, we are here to help! At Capital MBS, we will provide you with easy and convenient access to financial resources to help your business grow and prosper, opening up a world of possibilities for your business.