Have you unintentionally set your business up for failure?
No one sets out to fail! Most business owners read all the statistics
(maybe more than once) before they open their doors. Many know the
reasons why businesses fail. But some businesses operate under this
paradigm: "failure can never happen to me because I know better." Is
that you?
What most business owners miss is looking at the reasons for business
failure and turning them into action steps to help overcome the odds of
failure. How do I know? I once thought I knew better, too!
Bear in mind that even "adolescent" businesses fail.
According to the SBA statistics, 90% of small businesses fail within
the first five years. Many businesses aren't producing enough income
because the business owners aren't "business wise." They may be
excellent at a specific task - consulting, programming, massage
therapy, web site design, copywriting, etc. Or they have a great
product. But wise about the "business" of business, they are not!
In the past five years of my business, not one client (including those who have been in business for more than 10
years) provided me with a business plan to review. Not one!
Two of 100 clients have had marketing plans, but marketing plans don't
work without a business plan and other focus type tools, too. The other
common (95%!) mistake I see (and help my clients correct) is pricing
their services very low as a way to gain market share and new clients.
So low, in fact, that a potential buyer will perceive the service or
product as being cheap and of low quality, even when the provider
offers years of expertise. NO ONE wants to hire a business that is
cheap! Inexpensive - yes; affordable - yes; cheap - no, no, no!
The most common problems business owners experience stem from simple
functions like streamlining, organizing, information resourcing,
marketing, planning, visioning, languaging, communication, technology
and ecommerce.
Example: If you know that most businesses fail because they don't have
a usable business plan, develop your own business and marketing plans
and use them daily; don't create one that gathers dust on a shelf. I
use the One Page Business Plan Book or Interactive CD by Jim Horan. It
helps business owners create very realistic, focused, and well
thought-out business and marketing plans, including scorecards to help
you anticipate and avoid business problems.
Example 1: Recently, a client turned down an opportunity to teach
computer classes on a subject she could easily teach.
Using teaching to market her business is on her marketing plan. So why
not? Well, the proposed classes weren't going to help her get business
for her primary business, they weren't going to attract her ideal
client, and the pay was much lower than her usual hourly rate. She felt
confident about declining the offer. Of course, that same week, other
new business - the type she really wanted - came her way!
Example 2: New client knows she wants to create a business plan. She
also has a strategy of increasing her income by joining four
organizations with networking opportunities for her to meet her ideal
clients. She joins the first two groups - total cost: $400.
As she starts her business foundation work, which includes the One Page
Business Plan, she realizes that her ideal client isn't whom she
originally thought it was! Some clients might be found in the two
groups she's already joined, but not her ideal clients. As a new
business owner, she wants to spend her time around her ideal clients,
first and foremost. Planning just a little more for her business would
have saved her $400 in membership fees.
What other simple things can you do to build a solid business foundation?
∑ Use a one-page plan daily to create your to-do list and
monitor your business.
∑ Create an Ideal Client Profile and Elevator Speech and
define a niche for your business.
∑ Read one of the "E-myth Revisited" books by Michael
Gerber.
∑ Go with your strengths. Hire individuals whose strengths
ARE your weaknesses to "fill in the gaps."
∑ Remember that there is no need to repeat the SAME mistakes
others have made.
∑ Know what your business exit strategy will be.
Most business owners don't know what they don't know. Get assistance by
hiring non-biased professionals who help you realign with your vision,
create plans and financial scorecards to monitor your business. Look
for someone who can suggest resources to help you and your business
grow.
Someone who's been in your shoes and succeeded. Start looking at how
having a partner - a business consultant, coach, counselor, strategist,
organizer or planner - can help you grow your business.
Ready to learn more about business success? Take a look at the articles
I found on business failure that are posted below, (http://www.coachmaria.com/articles/succeed.html).
Learn to overcome the costly (both in money and your time) errors that
other business owners have already made. Give your business a fighting
chance to continue to succeed.
©
2004 Maria Marsala, is a business builder who helps women-owned service
businesses increase their bottom line in less time. A former Wall
Street trader and manager, she used her business expertise to create 6
S.I.M.P.L.E. Business Steps, a program developed to help her clients succeed in less time. Learn more at http://www.ElevatingYourBusiness.com
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