Starting a business 101
In my work at Confidential Counselor, as well as my role in strategy for the Hatchery, I regularly have the opportunity to work with new and would-be entrepreneurs. With the economy still stalled and hiring frozen, increasingly, people are seeking to start their own businesses. I wanted to share with you some of the most common mistakes that I see.
- Too much focus on seeking outside investors and capital
- Spending more money than is necessary on a website
- Devoting too much time on the minutia of the business instead of actually running the business
While working capital and a good website are important, the truth is that if you have a killer application/product, or offer an unbelievable service, you need to primarily focus on marketing. For some reason, startups are reluctant to concentrate on business development, and this is a mistake.
Being organized and efficient are important, but getting bogged down in theoretical or meaningless discussions and debates takes valuable time away from biz dev and marketing.
At the end of the day the bottom-line is the bottom-line. In other words, what did you produce for your efforts and did it generate income, and hopefully profit.
In good times or bad, investors will always look for great opportunities. Give them a solid reason to look at you based on your successful accomplishments and track record of success.
If you are unwilling to change, why bother asking people what they think? This is the question that I pose in this post regarding surveys and market research in general.
Sales accountability
A colleague recently asked me to complete a review of a sales team of one his clients. What I found was surprising, but sadly, not very unusual.
- Average time to respond to new sales inquiries: 2.2 days
- Rate of missed deadlines for quotes and bids: 41.8%
- Likelihood of not communicating customer needs to support departments: 68.1%
- Median time to respond to customer email: 5.2 hours
Some of these findings may surprise you, and in other cases, perhaps not.
How does your business stack up? Given this economy, can you afford to be anything less than 110% customer centric and laser-beam focused on the needs of your customers and prospective customers?
This is a big part of our work at Confidential Counselor. Please email me if we can be of assistance to you.
President Obama as well as his economic team and senior advisors have taken to the airwaves to tout what they are going to do to supposedly help small businesses. The vehicle that they have chosen to do this is to provide TARP money to community banks for small business lending.
On the surface, this sounds like a grand plan. Unfortunately, in reality, based on what we know so far, this appears to be nothing more that campaign style rhetoric. Here are some reasons.
- Will regulators and underwriters suddenly ease off on their overly stringent restrictions that they started applying 18-24 months ago?
- Many small businesses owners have killed their own personal credit rating in order to keep their business afloat and employees working during this recession. How will that be viewed by community banks?
- This program, as stated now, is especially geared toward urban and rural areas. So if I own a small business in say Princeton, NJ, employ 10 people, and I need assistance, I will not qualify because Princeton is not in an urban or rural area?
- One of the many failings of the ARC program was that financial institutions that did participate, and very few did, only wanted to work with current customers. Will this new program be different?
As an aside from all of this, why hasn’t the President called for swift passage of H.R. 2568? This would have a huge and positive impact on small business and would stop the diversion of millions of dollars to large corporations who currently receive small business set-aside Federal contracts.
President Obama once again recently said: “You got a better idea? Bring it on.” Well Mr. President, I, and many other small business owners do have better ideas and we in the trenches have done many things (letters, email, telephone calls, etc.) attempting to reach you to share them, yet, you have ignored us. Why?
It is time for President Obama to show some real leadership towards small business and to do the things necessary for them to save current jobs, create new jobs, and to grow their businesses versus regurgitating the same old worn out applause lines.
It is often said that it is the small things in life that get you. Using that saying, I believe that its also the small things that can help your business grow with little effort or cost. Please see…
Plan more events for your business
In this economy it is easy for companies to easily dismiss company functions such as client gatherings or networking events. Before you take this harsh step, let me offer some advice.
Over the last 6 months Confidential Counselor clients have actually increased their events based on our counsel. Specifically, they have partnered with other firms to produce successful functions.
As an example, a client of ours sells pianos. With our help, they were able to have a piano manufacturer share the expense of a networking and customer event. The manufacturer attended the event, provided marketing materials and on-site experts, as well as shared the expenses for the event. It was an overwhelming success.
We have also done this with restaurants, veterinarians, radio stations, software companies, furniture companies, office supply companies, and countless others.
As a side note, whenever you host a company event, you should always set goals beforehand. Seems like a simple and obvious thing to do, but, more often than not, people forget to do this.
The watchdog charged with monitoring the government’s $700 billion bailout unleashed one of his harshest criticisms of the program to date, questioning its overall effectiveness.
“I need money before I hire people, not after I hire them,” said Jimmie Hughes, the owner of Grand America in Richardson, Texas. Hughes’ 15-person company sells supplies for a range of businesses, including funeral homes and police departments.”
Mr. Hughes is spot-on. Small businesses have no access to credit, which means no working capital to go out and develop new business. Tax cuts are great, but it is more step step 3 or 4 versus step 1.
Please check out the full article to learn more.
Are patients customers? That’s the question more and more physicians need to ask themselves, especially with the stressed economy and the the rapidly changing business dynamics of the healthcare…
