Month: November 2005

I wrote my first business plan with my good friend Tim at the ripe age of 19 years old. Tim and I decided that we wanted to enter into the business of selling computers through the retail channel. We needed to raise some capital to start our business so we went about writing a business plan. Along the way to writing the business plan we elicited the help of many seasoned business people as well as many small business associations. The process caused me to read dozens of books, gathers thousands of pages of census and market data as well as do market studies.

After 6 months of 10 hour days we finally finished our business plan and our company vision had changed more than I could have ever imagined. About the only the consistent with our initial vision was that we would use computers and that there were to be the two of us as partners. We went from wanting to sell retail to working on call and in an office rather than a store. We changed our approach from selling product to selling services and solutions. Most of all we went from a concept that was going to cost us upwards of $100,000 (which we did not have) to something we could begin with a mere $5000 which we were able to raise.

What a difference 6 months and many lates nights can make,

Cheers,

CB

This is an area that I think can be both over used and underused, sometimes at the exact same time. No business should operate without a business plan; however, it is critical to remember that business plans are not written in stone. They should be fluid and will evolve each and every day as your market changes, you become more experienced and different economist and environmental effects come into play.
One of the first important lessons to learn about planning is that even with the best laid plans, events will rarely go completely as expected. Just relax and accept this as the way of life. Make sure you are not so rigid in your thinking that you have to follow the plan to a T. The business plan is designed to be a guide.

I can’t count the number of hours I have wasted in my sales career on customers who were more hassle than good before I learned the importance of knowing my audience. I am sure you know the type of person I am referring to. We have all had the experience of someone who will nickel and dime us on our most inexpensive product only to get it home then return it 2 days later. This is a key illustration on how important it is to know who your target market is. As business people and salesmen we should know inside and out what kind of customer we are looking for. We should be able to repeat this information in our sleep and recite it within 5 seconds of someone asking. This simple yet important process is lost on so many people.

I believe that listening is a skill that is very much under developed in our society. Often times what happens when someone is speaking to us even though we hear the words we are not actually listening. The human mind is capable of taking in over 500 words per minute but most of us use only a small fraction of that ability.

What often ends up happening is that when someone is speaking to us we immediately start to interpret what they are saying based on our ideas and the things we believe. When this happens we shape our opinions of that person based on our beliefs and the things we are thinking about and often miss what the other person is trying to tell us. This can be devastating if done in the sales process.

We as human beings have a deep down desire to be understood, when we feel that people do not understand us we shut down and become hostile or distant. Conversely, if we feel that someone cares about us and listens to what we have to say we become open with that person and begin to develop trust in them.

Fear can be defined as an acronym: False Expectations Appearing Real. This happens when we do not make our choices wisely. We can however change this at any time by taking responsibility for our choices, learning from them and becoming better at making them.

Often times we will have a bad day in life, but what we must realize is that 80% of our problems are within ourselves. Outside factors can only impact us if we allow them to do so. Until you make a conscious decision to not be influenced by outside sources you will be destined to be ruled by your environment. As soon as you make this determination your life will instantly change for the better. It will be like a load of bricks has been lifted off your shoulders. You will become free of your shackles and can begin moving towards your goals and objectives.

Those in life who fear choices really are living what psychologist call a “self fulfilling prophecy.” The term “self fulfilling prophecy” was defined by the American sociologist William Isaac Thomas when he said “If men define situations as real, they are real in their consequences.” What happens is a fear is created in the mind and it becomes the focus of a person. Since it becomes the focus, all actions taken by a person are complimentary to that focus.
What ends up happening is people focus so much on bad things happening because of decisions, they fear to make decisions. In not making decisions they become creatures of circumstance and end up being the brunt of bad events.

The high road to becoming a self-made millionaire in America is starting and building your own business. But this is not as easy as it sounds. Most businesses started by inexperienced people fail. Probably the primary reason why people don’t start businesses is because they’re afraid that they’re going to lose their money and for good reason. 99 percent of businesses started by people lacking business experience fail within the first two or three years.

Why Business Fail And why is that?

It’s because they don’t know how. They haven’t the slightest idea how to make a business successful. They may have an idea for a product or service, but they don’t know all the things that they need to know to run a successful business.

Why Businesses Succeed However, surprisingly enough, 80 percent of businesses started by experienced businesspeople succeed.

Now why should this be so?
The reason is because experienced businesspeople know what to do. They know how to purchase their products and their services. They know how to negotiate with their suppliers. They know how to raise money. They know how to negotiate leases. They know how to sell and to market. They know how to manage their finances. In other words, experience is the key. In order to start your own business and succeed, you have to learn how.

Competence Makes The Difference Now according to Dunn and Bradstreet, 96 percent of businesses in America that fail, fail because of what is called “managerial incompetence”. Managerial incompetence means that the people running the businesses don’t know what they’re doing. And here are the two critical areas of managerial incompetence that cause business failure. First is sales and marketing. 48 percent of businesses that fail in America fail because the business cannot sell enough of its products or services. Very few businesses fail when they have high levels of sales and revenues coming in.

Control Your Costs The second reason that businesses fail, 46 percent, is because of poor cost control. They may be selling enough on the front end, but they’re losing so much on the back end that they go broke anyway. Sales and marketing, financing and cost control, both require experience. And if you’re serious about becoming financially independent, you have to learn how to do both of these. Put Luck On Your Side You must learn the skills you need to be successful. Business success is not a matter of luck. Business success is a matter of application. It’s a matter of ability. It’s a matter of experience and skill and intelligence, and wonderfully enough, you can learn what you need to know to be successful. And you can start by learning through on-the-job training, which is called OJT.

Most successful businesspeople become successful because they get all their training by working for someone else.

Action Exercises
Here are two things you can do immediately to make sure that your business succeeds greatly:

First, take the time to get the knowledge and experience you need in business by working for someone else where you can learn a lot in a short period of time. Go to work in an area in which you are interested and learn everything you possibly can.

Second, read and study in business, especially entrepreneurial business, all the time. Read one or two business books per week and read every business magazine that is published on your subject. Never stop learning and growing.

“Inevitably in life we all come to the crossroad where we find ourselves saying “I don’t have time for this”. It is not that we do not have the time, as each one of us has the same 24 hours in a day. It is what we choose to do with that time that makes all the differences in the world. Have you ever stopped to wonder how some people seem to find all the time in the world to do the things they love while most people are stuck in their dead end rut we like to call a job.

Well I am here to tell you it is nothing more than the choices these people differently than us that make them who they are. You can change your behavior to become one of them by simply making better decisions.”

I am curious as to whether or not business people see this as an important issue facing them. I would welcome feedback on how you feel your time is managed and what areas you would be interested in receiving help on.

Cheers,

CB

Often times we will have a bad day in life, but what we must realize is that 80% of our problems are within ourselves. Outside factors can only impact us if we allow them to do so. Until you make a conscious decision to not be influenced by outside sources you will be destined to be ruled by your environment. As soon as you make this determination your life will instantly change for the better. It will be like a load of bricks has been lifted off your shoulders. You will become free of your shackles and can begin moving towards your goals and objectives.