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September 13, 2006

How to succeed in business

Link: How to succeed in business

by Brian Turner

Alright, we’ve told you how to fail a business – let’s look at how to give your business the best possible chance by looking at elements you’ll want to get right to succeed.

1. Planning

Most sources of advice on starting up a business will rightly point out that you need to plan. But you can’t just pull figures out of the air – you need to know something about the business area you’re entering into to make it work.

On the one hand, you can do research – but always be aware of the limitations of research figures. There are lies, damn lies, and statistics. And more so that those statistics are often yesterdays news.

Don’t simply try and get information on the business area you plan to enter – enter it before you run the business. If you’re looking to sell products, then do your research as a customer – find out how other businesses relate to customers and the prices, perks, and methods of reaching customers they employ.

And if you’re selling services, make yourself something of an armchair expert on the subject before you sell yourself commercially. Be warned, though, that commercial pressures can make the whole experience very different, but at least by knowing as much as you can about the industry you’re entering into, you’ll be better prepared to solve new problems as they arise.

2. Flexibility

In the modern business world most business areas have an element of fluidity you simply can’t plan for, so ensure you have a degree of flexibility you can work with.

That means if you wrote up a business plan, only to find market realities evolve differently than expected, then you evolve with them.

This is especially the case in the modern digital world where the internet and ecommerce is one of the most exciting – but also most volatile – mediums that you can work with.

So in your initial planning look at different options you may need to engage at some stage. Some you’ll never use, some you’ll need to adapt as you face them – but overall, get it into your head at the start that marketplaces change, and to succeed you need to change with them.

3. Administration

You need an accountant from the very beginning. Determining your expected levels of profitability at the start can determine your business structure – ie, sole trader or limited company – and therefore determine just how big a tax bill you can expect to face. In this regard, an accountant can save you thousands or even tens of thousands.

Also, ensure you’re on top of administrative duties from the start. I know it’s a chore and not many people enjoy typing up invoices, but at the end of the day, the sooner you have control and constantly updated admin records, the easier it is for you in the long run.

Fail to admin properly and it really can cost you – not simply in extra tax liabilities, but also in lost revenues if you have to dedicate time playing catch-up with the books.

And bear this carefully in mind – the tax man can and does destroy companies for failing to admin their books properly.

4. Investment

There’s every likelihood that you’ll need not simply start-up capital investment, but also constant periods of reinvestment of revenues into your business to allow you to maintain efficiency and even expand.

Investment amounts will vary immensely on the business type – bricks and mortar businesses traditionally start with high overheads, while internet-based businesses traditionally have low start-up costs.

But as before, markets change, and you need to ensure your business is a well-oiled machine that can adapt and move with new and emergent market trends, to remain competitive.

Ideally, you’ll want to set yourself a budget and try to keep as close to it as you can, whether on a monthly or annual basis, so that you can reign yourself back from investing too quickly, or even not investing enough.

Simply ensure that whatever form of investment you take, you implement intelligently. Don’t risk your home on a business unless it absolutely definitely needs to be done, and make sure you have a clear plan for recouping investment costs through excess profits.

5. Pace

Look after yourself. No, seriously. A new business can require a lot of time and effort from yourself to establish, but watch out that you don’t burn yourself out.

There’s nothing more tragic than creating a well-run and profitable company if it makes you too ill to continue managing it.

I don’t make this comment lightly – many people who started their own companies will know of people who burned out, nearly burned out, or almost burned themselves out as well.

Bottom line is, a healthy company needs a healthy management who can be alert to the companies needs without sacrificing themselves totally.

And if you’re working from home, there are some decent tips here: How to survive running a small business from home.

6. Customers

Customers are the life-blood of any business. Treat them well, and in theory, they’ll treat you well.

But you have to have an idea of your limits, and know how much you can provide for free and when you have to charge.

It’s all too easy with a new business to try and make every customer extra-happy by spending extra time for free helping them, or not charging proper rates because they’re a friend.

In such instances, you’re already undermining your business.

In business to business industries, other companies expect that they’ll have to pay for extra work – in business to consumer industries, the customer knows that they should expect a certain level of customer care, but that a company that goes bust from giving too much too soon offers no care at all.

Be reasonable – give time to your customers, but make them aware that while you can probably devote some extra care to make them feel special, there’s a clock ticking in the background, and that’s your overall business that requires your attention making the ticking sound.

7. Attitude

Having the right attitude is actually a very easily over-looked aspect of running a successful business.

Running a business can be tough - there are always challenges, technical problems, and issues that need solving. Plus when things look bad they can sometimes look really really bad.

What you need to ensure you develop is a positive attitude that admits that problems are a pain in the arse, but you’ll solve them anyway and get past them. And even when times look bad, think less of how to escape from the responsibility as much as how to adapt your business to change your circumstances for the better.

A positive attitude means accepting that hurdles exist but can be surmounted - and so they can, so long as you don’t blindly approach them. As soon as you start to embrace defeatism in the face of adversity, is the moment you embrace the failure of your business.

If things ever do look really bad, take yourself away from the situation and have a short break from the office to walk around and see if you can work things out. Most problems are solvable, not always easily, but often doable - though the solutions may not always be so easy to figure out, and especially when you’re standing too close to the problem.

Be brave. Be positive. Be optimistic.

Running a business can be sometimes tough, but if you can persevere, the rewards can easily outweigh all adversity.

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1 Comment »
  1. […] I recently posted a somewhat short and trite article on Platinax called How to Succeed in Business. […]

    Pingback by Brian’s Business Blog » In business, attitude is everything — October 9, 2006 @ 3:23 pm

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