Business Management: Defining Your Course To Success
There are a few things in life that we all need to survive like food and water and protection from the elements
. If you have these, not only can you make it from one day to the next but you also provide yourself the opportunity to better your current life and future.
It is said that you cant:
Go 3 hours in the elements without protection,
Go 3 days without water, or
Go 3 weeks without food.
Well, the same is true for your business. If you want your business to not only survive but prosper, you should also follow these business rules:
Business Rule of 3:
Never go 3 hours without marketing,
Never go 3 days without praising your employees and staff, and
Never go 3 weeks without reviewing your business plan.
While the first two are obvious and wont be discussed here, if you really want your business to succeed, then you must have an understanding of what that success is and then develop a plan to not only get there but to make sure that you are continuously on the right path (the review).
Now, unless you are seeking outside funding or outside partners like suppliers, large customers (i.e. government entities) or alliances, your business really does not need a formal business plan as much of that formal information (like your business structure or location) are redundant and unnecessary to insiders like you.
What your informal business plan should focus on is the Who, What, Why and How your business will become a success.
Lets look at these individually to understand why your business should focus on the Who, What, Why and How:
Who Who are your customers, your core customers? Those customers that will sustain your business through both highs and lows. These consumers will be your bread and butter. While your business may want to sell to everyone on the planet, it is just not possible to both provide and market to every person on earth.
Thus, your business needs to focus on a niche segment. This will allow your business to focus specifically on a subset of consumers ensuring that your business is getting the right message in front of the right people at the right time as well providing the right product to meet their needs (see our next point).
Know the 80/20 rule. Your business will receive 80% of its revenue from 20% of its customers. Know who that 20% of your customers are and ensure that you are the company they think of when their needs arise.
What What products are you are offering? Are they designed to meet your target customers needs? Are they built for them or for you? Bottom line: will your products and services meet your targeted customers needs, wants and unknown desires.
Far too many consumers tend to settle on one product or another because they either have no other option or are unaware of other options. But, having customers settle on your product is not a long-term strategy as these customer will not be loyal to your business and will be constantly looking for or trying other products.
If you know your customers and provide products for THEM then you will not simply be a settle for company but the go to business of their choice.
Why Why your customers should buy from you! What is the value proposition that makes your products and service better than your competition? This also relates to your marketing ensuring that you are getting the right message out in front of the right people at the right time. But, if you dont know your customers and dont have the right products for them - then your message will always be off and so will your business.
If you cant tell your targeted customers why they should visit your business, then they will never be your customers.
There is a lot of noise in the market these days companies/competitors touting their products (some that work and some that dont). If you want to stand out, you have to be able to convey to your targeted customers why your products or services are better at meeting their needs be it functionality, reliability, convenience or cost.
How The how here is not so much how per say (as that is why you are writing and reviewing your business plan) but - how much.
How much is it costing your business to provide this product or service and how much can you charge for it (charging too high a price may be good for your bottom line but could drive customers away to less quality / lower cost products).
Thus, can your business still make money? Can it make enough money to not only cover its costs but to ensure an adequate return on the capital invested?
Plus, reviewing your financial plan can also help your business understand where it can continue to both cut costs (while keeping qualify at current levels) and where it can generate additional income (through new or better offerings).
Many new business owners write some type of business plan when they start their business (as they should). But, those early plans are usually very rough drafts of the true business plan that entrepreneurs really needs or should have.
The reason: Most new entrepreneurs just dont have the knowledge yet about their company, their products, their customers or their market or they tend to follow one of the millions of business plan templates out there wasting time and energy on sections that just do not matter their business. But, do know that each business is unique and each business plan should be unique as well.
Now, knowing that your first business plan will be sub-par does not mean that you should not write one. Further, once in place it is not done. Know that your business plan should constantly be reviewed and updated as you and your business move forward and learn or gain more information.
Thus, if you want to ensure that your small business is on the right path and staying the course to success, think about the business rules of 3 and pay particular attention to developing and reviewing your on-going business plan.
by: Business Money Today
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