What are the key factors for the success of a new business?
Everything you learned in Entrepreneur and Fast Magazine is probably wrong. Those magazines are pornography for business starters.
This is going to be damn hard work. Harder than you figured, by a factor of 5. You can’t go home at 5. Most people just give up, exhausted and spent. Burn-out within 15 months is common.
You are going to feel a lot of pain, anxiety, fear, angst and dread. If you can’t deal with it, if you’re not tough enough, it’s all over. Flame out comes sometimes within a year, most often after the 2nd year.
You are going to have to plan things out. Which means you better do your research. Most available research is rubbish. You have to dig, hard. The vast majority of business plans aren’t worth the paper they are on. Business starters have to understand the dynamics of their businesses, and the key elements to success.
Nothing happens until something is sold. Having the perfect product but no sales is guaranteed failure. You must sell, sell, sell. Oh, and did I mention, sell?
You have to understand the 5 factors that make any business successful:
1) Idea – is it a good one? Is there a need? Can the concept be actualized? Can the product benefits be quantified?
2) Market- what is it, where is it, and how do you get to it? What message will motivate the prospect? How do you get a repeat buy? What will competitors do to you?
3) Capital – financial and human. How much do you need, and how much extra should you get because you’ll always underestimate what you need. How much is it going to cost? What key people do you need and where are you going to get them, reward them and make them stick?
4) Execution – is almost everything. Marketing, sales, production, fulfillment, customer service, accounting, HR, finance and accounting must all run like clockwork. Ignore one and you’ll sabotage the business.
5) Flexibility- the original plan won’t work. Guaranteed. What is plan B and plan C? How will you know if things aren’t going according to plan? How can you dodge torpedoes, keep the spinnaker filled and keep on course, which will change?
Being successful in business is all about focus on details. Many disparate details. You must be obsessively focussed and driven. This is extremely hard to do over more than a very short while.
Mindset: you must be in a position where there is no alternative to success. You cannot fail. You will not fail. You must be driven to succeed, literally desperate for success.
Legal – you better know the law. Employment law, business law, contracts law, copyright law, UCC, tax law. There are landmines out there to get those who don’t understand the legal issues in every business.
Spiritual aspect. Most entrepreneurs don’t talk about it, educators ignore teaching it, but starting a business has a spiritual aspect to it. You are giving birth to a new creation. You need all the good Karma you can get. You will set in motion either a good thing or… I find that success doesn’t happen without a good dose of prayer. OK, so you might call it something else, you may deny the existence of anything not in evidence to our limited senses, but I believe strongly that my success has been propelled in large part by some help from Above.