Starting your own business from scratch can be a terrifying prospect filled with self-doubt and worries about failure and going broke.
To help you safely negotiate the path of entrepreneurship, we asked business mentor and author Brian Marcel to share his blueprint for business success.
If you are still thinking of starting your business or are stuck along the way and want to break out to the next level read on.
This guide follows the life cycle of a small business and gives tips on how to grow from a standing start based on my experiences, and with the occasional excerpt from my book ‘Raise the Bar, Change the Game.’
The Start before the Start
It’s never too late to start your own business. I was already thirty-five years old, and I had yet to discover what sort of company I wanted to start.
I always knew I wanted to start my own company but never knew what I wanted to do. So, I kept following the opportunities until they led me to something that appealed to me.
I always tell people I mentor not to get stuck on trying to find a new and disruptive idea. Great of course if you can but most of the great ideas have already gone and unless you have invented something revolutionary stick with something you are passionate about and do it better than anyone else.
Being passionate about an idea is crucial as it is this that keeps you going through all the inevitable knocks and disappointments. Learn to love your customers and not your product or service. You need to go the extra mile for them and nothing will be too much trouble.
Begin with a Plan
To start the business, you need to have self-confidence and a risk-taking mentality. You need the former to inspire your prospective employees and the latter to give things a go even though you may fail.
It doesn’t actually matter if you do fail because you will only be back where you started, a lot wiser and able to pick yourself up and start again.
Once you have selected your idea make sure you surround yourself with positive people who will encourage you to go ahead. Negative people or nay-sayers will strongly discourage you and say it will never work. Probably, they are envious of your entrepreneurial streak. Don’t listen to them, let your passion overcome any doubts.
Then produce a plan. It need only be a one pager unless you are seeking a large investment with the following headings:
- The name of the Company
- What is the purpose of the Company
- Your Mission Statement
- Five goals to complete by the end of the first year
- BHAG (Big Hairy Audacious Goal) a dream well into the future where you visualize what your Company would ideally look like that seems impossible today
Make sure you create action plans for each goal with a timeline and accountability, and understand that all goals should be SMART – Specific, Measurable, Achievable, Results orientated, with a Timeline. Remember, it’s not enough to say we will be the best; you have to make it happen.
Here are five strategies to achieve those goals:
1. Hire the Best People
You can’t do everything yourself as you just don’t have the skills. Until you can afford to hire anyone you will have to. If you have a friend or partner you trust with complimentary skills such as being a details person if you are a visionary or vice versa this is ideal to split the shareholding 50-50% from the beginning.
I was fortunate to have my wife who brought the soft skills to my business and was an important sounding board for me, but I am a visionary not interested in day to day management so now I have someone in each Company who runs it on a day to day basis while I do the strategic thinking.
Hire people who are more intelligent and cleverer than you. They will bring in new ideas and skills to the Company. Do not be so proud that you can’t listen to new ideas.
Make sure you give them a rigorous interview and judge them on how they would fit in with the culture of the Company, then look at their past performance for clues of future performance.
2. Focus on Profits and Cash Above All
Nothing lasts forever. You product/service has a life cycle so anticipate any competitive disruption or replacement.
Profits are important, but cash is king. It’s essential you learn how to read basic management accounts and a balance sheet. You can make large profits but if your customers are not paying their bills on time you can run out of cash and so go bust.
Even the healthiest of businesses ultimately can run out of cash without seeing it coming. I once went to my bank and asked for $50,000 to buy one of my competitors which I knew to be just a year return on investment. A slam dunk if you will.
My bank turned me down and put me into incubation where they controlled all my cash movements until I had repaid all my borrowings from them. Then I got left to wind myself up.
I did get my money back in a year thanks to my brother who lent me the money, but the bank had seen that I was lending too much to my other business and the more successful they got the less cash I had available to service my debts.
So, learn to read your cash flow position daily, weekly or monthly.
3. Grow the Business Through Networking
Reputation. Is everything these days. It used to be enough to advertise but with social media and fast news the focus is on reputation both yours and that of the Company. Clean up your Facebook page especially the photo of you drinking a case of beer at your 21st birthday party.
Customers have so much access to information about you that you need to cultivate what they see on line about you. They will ask previous customers how you performed and whether you are trustworthy. So, start building a network of great contacts.
Go to industry conferences and offer to become a speaker. Get involved in relevant discussions on social media, become the go-to person and thought leader in your chosen markets.
To become a good networker, it is important to be a good listener. By the way this is good advice in everything you do especially sales. First of all, it is polite but secondly it can be used as an effective weapon as a silence can become embarrassing and the person who breaks that silence may well reveal something they had no intention of revealing.
Introduce yourself to your target with a visiting card and then ask them about themselves. This is a sure winner as who doesn’t want to talk about themselves?
You shouldn’t, if asked, just give minimum pertinent information and don’t be on permanent transmit. Do not sell anything on first meeting just build a relationship and sales will come naturally later.
4. Break Through the Glass Ceiling
If you get stuck or feel you are reaching a glass ceiling and cannot breakthrough there are various tactics you can use;
- Seek out new markets and or products/services.
- Be more evangelical about what you currently do.
- Use blogs, white papers, contact key influencers to raise awareness among their followers and networks.
- Hire a new sales person with market knowledge in your field with a seven-figure track record. He/she will be very expensive, but you can get a feel after 3 months if the money was well spent and you can get rid of them if it isn’t.
- Get rid of dead wood in your organization. There are three stages in the life of an underperforming employee: faith when you hire them that they will do their job, hope when they haven’t achieved their target, but you still hope they will. Finally, charity when they are still employed but should have been sacked months ago.
- Target specific companies who will give you bigger orders.
- Pretend to be bigger than you are.
- Collaborate with companies who are in your eco-system whose skills you need to deliver a project. They will start bringing business your way.
- Start digital marketing especially inbound marketing to target and track leads more effectively.
- Look for small improvements in several of your processes which together add up to a large improvement. This is more manageable.
5. What to do When it all Goes Wrong
Things will certainly go wrong not once but many times, so you need to be prepared, you need to have a Plan B.
Do not panic. Several times I had staff leave me to start their own businesses. Flattering I know but not very helpful. I accepted that they were not indispensable and just replaced them with better people.
Sure, I lost some business, but these setbacks are normal in business and if you maintain that self-confidence and self-belief I mentioned above – don’t confuse this with arrogance though – you will pick yourself up and win through.
I hope this guide is useful and will give you the kick you need to get started, or help you through any growing pains you may be experiencing.
Just remember you are a special person taking risks to embark on a scary journey but along the way you will achieve so much and give people jobs and build them a better life while you do the same for your family.
Best of luck to you all.
About the author
This guide has been exclusively written for ByteStart by Brian Marcel, author of Raise the Bar, Change the Game, and founder of International Bar Code System (IBCS) Group. Known as “Mr. Mentorvator” he has helped seven entrepreneurs become millionaires, and is aiming to do the same for ten more people in the next five years.
More on starting your own business
ByteStart is packed with help and tips on all aspects of starting and running your own business. Check out some of our most popular guides;
- 10 Advantages running your business as a limited company has over being a sole trader
- How to set up a limited company
- Which types of insurance must your business have?
Funding your business
- What to do when the bank says “NO”
- 6 Things you need to know before launching a crowdfunding campaign for your business
- How to maximise your chances of securing a small business loan
Leading a business
- How to be a leader rather than a manager
- Why the best leaders do less
- The Founder’s dilemma – Managing the transformation from start-up to growth business