3 of the 20 MUST Know Laws to Building a Successful Small Business
1. Find a Need & Fill It! (Blah, Blah, Blah!)
You have heard this a million times before, but it is the core, the root, the foundation of any business. Business is about serving people’s needs. The more people you help, the greater you are rewarded. It is not about doing what you love. Although if you can accomplish both, then that’s great. But as catchy and simple as this phrase is, unfortunately there is a little more to it.
One of the biggest problems people have when starting a business is what I call “Dedication Justification“. Justifying what they want to do by concocting some need that really does not exist for their product or service. Dedicated Hobbyists and Artists are notorious for this. For example, Let’s say you are an artist and want to start a business selling other people’s creative works as well as your own. So you convince yourself that there is a real need in your town for great art. The only reason more people in your town don’t buy art is that there is no place to purchase great art. Guess what? Chances are you are lying to yourself and you don’t even realize it.
Even if you buy into the “find a need” concept, there is a right way and a wrong way to approach it. I can’t argue that there have been fortunes made by people that saw a need and invented a product or service to fill that need. That, however, is the WRONG way! Although people have become millionaires taking this route, there really is a much better way. Going this route usually takes people years of research, testing, fighting with manufacturers, getting patents etc., before their vision is ever manifested. In the meantime, they have killed themselves, destroyed their families and invested thousands or hundreds of thousands of dollars just to get to the starting gate. And let’s not forget the millions of people who have taken this route and lost everything. No my friend there is a better way.
There will always be needs that need to be filled. There is a need for cheaper fuel to power our automobiles. But are you in the position to drill for oil, refine fuel, develop nuclear energy or discover some alternative fuel that no one has found yet? I am guessing the answer is no. The secret is not to look around and find just any unmet need. The secret is to find a need that you are qualified or can become qualified to fill. This requires a lot of self analysis and honest self-evaluation. It’s something most people are not prepared to do, at least honestly.
For example, let’s say that you are a welder. You should not open a welding shop and hope that people who need welding will beat a path to your door. A much better way is to keep your eyes and ears open for people who are complaining about an issue that can be solved by welding. This may come from hanging around the local farm store and hearing farmers complain about their tractors and big equipment needing repaired, but not being able to haul the equipment into town. So you start a business that specializes in making house calls for on the spot farm equipment welding and repair. Or you hear on the news that most of the bridges in your state are way overdue for servicing, so you start marketing to local governments to inspect and repair bridges.
As another example, successful plastic injection molding companies like Rubbermaid and Sterilite look around for common problems and products that can be made with plastic. A company that specializes in computer programming looks around for needs that can be addressed through computer software.
Anyone can start a temporary job placement service without a lot of experience in the temporary job placement service business. I have seen many come and go even when there was a demand for such services. But you do need to have experience with marketing, selling, doing payroll, hiring people, organizing, etc.
2. Standardize Your Product or Service
Trust me when I tell you that most of my life I have made this mistake. DO everything in your power to standardize your product manufacturing or service (create business systems) or you will spend your entire career re-inventing the wheel and getting nowhere. If you must be in a business that requires customization, charge by the hour not the job! Until you reach a level of demand and prestige like Vera Wang, Ralph Lauren, or Gucci forget selling custom work by the job. Inevitably your buyer will have a different idea and want changes or not be satisfied because they concocted something completely different in their minds that is totally different from what you have. Again, all laws in business can be broken. But trust me when I tell you that your life will be a living hell if you develop a business where everything is customized. Don’t say you haven’t been warned!
3. Find a Way to Leverage Your Work
(This is an extension of Standardizing Your Product or Service) If you want to make the big bucks or at least a good living without working yourself to death then heed this. The biggest mistake that I have made and most people that I know who have gone into business fail to realize, is that you want to do something once and get paid for it thousands of times. Spend two years writing a book (once) and sell a million copies. Build a machine (once) that makes the best widget in the world and then hire someone to run the machine to produce millions. Develop a business that serves a community in such a way that you can hire people to answer the phones, push the buttons and follow the procedures that you developed (once). Movies are produced (once) and sold millions of times. The final version of the first Ipod was engineered, assembly lines created and then the engineering that went into it where sold over and over again.
For the entrepreneur the keyword that you want to repeat to yourself a dozen times a day every day is “Systems”. If you cannot develop a system to produce and deliver your product or service, then you do not have a business.