A Few Words Before You Start Your Business
Whether you are starting a business you expect will become the next Microsoft or you are starting your own restaurant, green dry cleaning establishment or clothing store, whether you plan to offer your own personal services as an event planner, a masseuse or as a janitorial contractor, you must create a plan. It could be that you are going to offer the same type of work you’ve previously provided as an employee – legal services, accounting services, marketing, media services. Or, you may be planning to develop apps for i-phones or i-pads. No matter what type of business, no matter how large or how small, every business that expects to succeed needs a plan.
“Why,” you ask, “what good will that do?” “I don’t want to take the time,” you say, “I just want to get going.” Well, the fast path to failure is the unplanned path. 66% of small business start-ups survive 2 years and 44% survive 4 years. My bet is that you want to be in that 44% and you don’t want to just survive, you want your business to thrive. Most certainly, you want it to be profitable. Planning, preparing for all the challenges you’ll confront, that’s the most powerful means to your success.
You may have already googled ‘business plan’ and thought, forget it, that’s a lot of trouble or, you may have felt a tad daunted by the complexity. Not to worry, there are ways to shape your business plan so that it works best for the size business you are planning – whether it’s a $25,000 a year business, a $250,000 a year business, a $2.5 million dollar a year business or something still larger. Whatever size business you envision, you, your invested time and your invested dollars will more likely see a successful return if you start with a plan. Click here for all the business plan details – what needs to be in a plan, what kind of a plan for start-ups, existing businesses, for big ideas and for the more modest-sized firm. (Why risk it, make a plan!)
By the way, if your only goal is to make money, your prospects for success are immediately reduced. Surprised? It’s true. The strongest new businesses are those started by people who love what they do! Here’s the story of a woman who was passionate about how to treat the people who worked for her – she even included the Golden Rule in her initial business plan. She started with a $5,000 investment and a very clear plan; today her firm’s annual revenues are just shy of $3 billion!
Mary Kay Ash had worked successfully in direct sales for more than two decades ultimately becoming national sales director for a global firm. However, at 45, she resigned over her growing frustration as yet another man she had trained was promoted to a position not just above hers but also at twice her salary. Without a clear view for what was to be next, she started writing a book to help women achieve the business opportunities she had been denied. The more she wrote, the more she realized that she was actually creating the plan, the foundation for a new organization where women could develop their talents and achieve unlimited success.
In 1963, using the knowledge she’d gain working for others along with the plan she’d just developed and $5,000 in savings, Mary Kay Ash created Beauty by Mary Kay. Sadly, her husband died just as she was about to launch her new firm so she enlisted her 20-year old son, Richard. The plan for her fledgling company was very clear about its values – the company was founded based on the Golden Rule – on praising people to success – and on the principle of placing faith first, family second and career third. This, indeed, was a company with a heart.
This remarkable business, started 47 years ago, is not just a company with a heart, it’s a company with more than 1.8 million independent Beauty Consultants throughout the world and sales of about $2.6 billion, a company that’s been profitable starting with its very first year. That’s right, Mary Kay Ash wrote a plan from her heart, invested her $5,000 in savings and, with help from her son, she grew Mary Kay into one of the strongest businesses in our world. Material sourced from the Mary Kay website, http://www.marykay.com/company/companyfounder/default.aspx.
For more information on using your passions, your greatest strengths, go to Everyday Life/Your Strengths.
When your goal is a thriving firm, it’s necessary to seek the advice of experts. Yes, for sure you can read Accounting for Dummies, but that doesn’t mean you’ll gain the greatest advantage when seeking business loans or investment credits or when making certain your firm is profitable and not just churning cash. Or, you can go to a seminar on marketing and hope you’ve gained the right information to take your business to the right customers using the right offers and media. When you are risking not just your money but also your time and your heart, it’s an imperative that you use experts in their field. Remember, there’s not a successful enterprise today that doesn’t seek the advice of experts. If you need references, be sure to go to Money Matters/Links.
Learn everything you can about your customers, who they are, why they’ll want your product, why they’ll pick your product or service over another. Is there something about your product or service that makes it altogether different from your competitors? Is there a way to tell your competitors about the difference so that your customers will recognize it and chose your product or service? This is called differentiation, how your product or service differs from your competitors in ways that compel your prospects to choose your product or service.
Your financing strategy is critical to your company’s well being. Right from the start, it’s necessary to work from well-developed financial forecasts while supplying the new business with the capital necessary for all cost categories. It’s necessary to have a well-developed stream of capital that funds all operations. Further, fully developed financial plans along with the tools to assess your progress will help to make certain that your company generates profits and not just cash flow.