Three absolutely ‘must dos’ when starting a business enterprise, but do you dare?
Is there a magic formula to guarantee that when you start a business enterprise, it will be a success?
No! Absolutely not! There a billion factors involved, most of which are not in your control; an unexpected government initiative, a surprising competitor with the same concept, an international credit squeeze, and even a virus emerging from bats in an unknown province in China with an unpronounceable name.
And so the list rumbles on. Moreover, rules that apply to a specific industry may be less relevant to another.
However, none of these issues negate the responsibility that you, the intrepid entrepreneur and executive, should have for seeking to do your level best.
I have helped countless numbers open their business. Time and again, three over-used phrases come up. People use them all the time, but frequently misunderstand their true significance. It is time for me to share this trade secret with a wider audience.
FIRST, before you lay out a single penny, cent or shekel, you need to know where you are going. That means you need a “vision statement”.
Imagine you are the captain of a large ship. You are told to set sail. The vessel leaves port, but then what? Without a target, the captain will not know how much petrol to take on, provisions, crew, etc. And his mighty boat will go around in circles, because it has not been assigned a clear destination.
That will be the same disastrous outcome for your business. To translate a Hebrew colloquium, you will be hitting the accelerator on the full yet going nowhere slowly.
SECOND is the function of a “business model”. Look up this phrase on the internet, you will discover a billion versions to describe this phrase. Allow me to cut through the red tape and deliver a practical explanation.
Whether you have created a product or service, before launching to the market, you need to know who is going to buy it, where, how, when, at what price and why. When you think you know the answers to those questions, validate them.
Proof to yourself that you are not talking goobledeegook! Otherwise, as you formalise your findings in a business plan, the document will be incoherent.
THIRD, and by no means least, there is the little matter of “fixed costs”. Let me immediately clarify that these are expenses that exist almost every day and remain very static in level throughout the year. In other words, these costs hang around, even if you do not sell even one item.
A typical example could be office rental or back office staff. Another example, when it comes to smaller operations, could be the monthly budget of your household. If you cannot cover these items through sales, you are on the wrong track! No room for discussion.
I have spent nearly 15 years as business coach and mentor. It concerns me how often I have seen SMEs trying to ignore this rule, usually ending up dipping heavily and ineffectively into their savings.
If you have read up to here, you may be saying “well, I know all that, but I still don’t seem to get it right. Help!”
What is stopping you both reaching out and then accepting guidance? The answer is not procrastination. That is the symptom. Compare your position to my clients in the year of corona. They have opened businesses, taken operations overseas, secured loans, increased sales.
My work is to act as your guide, coach and mentor. I use my experience as a strategic economist, with an ability to see all sides of an enterprise. I offer you the clarity you desire to make vital decisions on your path to success.
To find out more – to learn how to create a solid vision statement and business model, and then to ensure you get things done – do not hesitate to call me.