It’s hard to distil a lifetime’s business learning into a few short words, but here are some suggestions that you may not have encountered before.
- Don’t do it for the money. Riches are the currency of success; they shouldn’t be the goal. Go into business because you have a great idea, because you want to make a difference or perhaps because you feel you can run a better business than others.
- Forget the ‘passion’ thing. I know it’s the received wisdom at the moment but passionate people tend to be emotional and that can cloud judgement. Instead I’d settle for logical, rational, analytical thought, the ability to take knocks and bounce back, and a commitment to continued learning.
- Listen to your market. Research your customers’ (or potential customers’) views, find out what they think about your product area, how they use existing products, what they think of competitors’ products, what they would like but don’t get now. I’ve never failed to find nuggets of pure gold.
- Find a niche. Find a gap that’s not being filled, that’s exploitable, reachable and defendable and make it yours. Niches can be very profitable because they are neglected by competition but can fulfil a genuine need for customers.
- Plan carefully. Have a written business plan, go through every step being ruthlessly honest and leave nothing to chance. Best of all, get expert help. If you don’t do it, you may miss something vital and you’ll have nothing to monitor progress against.
- Get professional help. Especially get a good accountant – they’ll help you model the finances of the business and see you through the maze of tax advice you really need. Choose your accountant as your new ‘best friend’ because you’re going to be working together.
- Focus on cash generation. Even profitable businesses can die from lack of cash but it’s a rare business with a healthy cashflow that can’t survive. If you don’t know how to do it, get your new ‘best friend’ to set up a system for you.
- Plan your exit. The easiest businesses to sell are those where the cash and profits are healthy and growing, competition is avoided head-on, the systems and process ensure consistency of result, the business is scalable … and the owner is dispensable.
- Plan for the worst in one special area. The shareholders’ or partnership agreement is a vital document. It governs the conduct of the owners of the business across the many situations that can go wrong. You should get a lawyer to draft this for you; it can be worth its weight in gold.
- Don’t be afraid to change. Circumstances change and that original great idea may not transpire to be viable. Learn from your experience and don’t be afraid to move on to something new; it’s better than flogging dead horses and you don’t get to meet an administrator.
- Be positive, not blind. Yes, you will need to be positive but never fall into the trap of believing your own propaganda. Be honest with yourself, your financial backers and your team; it won’t always be easy but they’ll learn to trust you.
Tony blogs regularly on many of these and other issues relating to business at: http://theretrospectiveentrepreneur.wordpress.com/