 |
 |
 |
 |
There is no one on earth or the other eight planets that would love your business like you so be sure to understand how every component of your business functions to ensure that your business survives in the long term.
One of the most important things any of my business mentors said to me was that “It’s great if you love what you do, but that’s not what business is about. When you decide to label it a business, it has to ultimately be profitable.” That is the reality of things.
As an entrepreneur, you need not know only your craft but you need to also know how to be a leader, a forward thinker and even if you do not intend to manage the day to day aspects of your business, you need to know how to identify a good decision when the manager you hire suggests it to you. NOTE: There is no one on earth or the other eight planets that would love your business like you so be sure to understand how every component of your business functions to ensure that your business survives in the long term.
Some key areas you should understand are:
Financial Management, which refers to an understanding of cash flow planning, revenue management and maintaining good credit. In the United States in particular, a good credit history is everything.
Planning and Development – Planning is at the core of any business. Entrepreneurs must have a vision since even monopolized markets do not remain monopolized forever. That said, you would have to find new ways to engage customers and ensure that they remain with your company. To do this, you will have to have a clear understanding of who your customers are, what they need and also an understanding of your competition and how they compare with you (this will be examined in later posts).
Personnel Management – Entrepreneurs are leaders so needless to say that people skills and people management skills are necessary. This includes recruitment, conflict resolution, motivation and training. Small businesses usually do not have a large staff if staffed at all, but once your business grows and you employ others you will need to understand that your business is as strong as the weakest link. Explain the importance of the above to the people you employ and in the long and short term, your business will benefit.
Business to Business Relationships – In the real world, the idea of isolating yourself will get you nowhere fast. In business, it’s no different. The most useful thing a business, especially a small or startup business can do is to create sound business relationships with other businesses that it may rely on. Building sound relationships with these businesses will increase efficiency since from time to time you may receive preferential treatment, you may receive assistance when you are in a tight situation (perhaps you need a faster turnaround time for a particular service than the company tends to offer but they will do it on your behalf), and of course there is the ability for a small business to barter products and services. In this way neither company spends its limited funds directly, but gets exactly what it needs from the other.
Sales and Marketing – The last but certainly not least important area to assess yourself on is sales. Don’t get sales confused with marketing. Though equally important, marketing refers to targeted activities and material that engage potential customers. Sales refers to the actions necessary to secure a sale. Without sales your business cannot survive and grow. You need to be able to identify potential customers and their individual needs, explain your goods and services effectively to them and convert these potential customers and leads into clients.
In coming posts we will explore the importance of a business plan and a marketing plan. We won’t go too in depth here but understand the importance of assessing your company’s viability in relation to the market. Where the business plan is involved you must see your position relative to your competitors and where your marketing plan is concerned see where your marketing dollar will be best spent to ensure effective usage of limited funds.
ervinWelsh – CEO, Beyond Timeless
