Entrepreneurs: How Strong Is Your Business Foundation?

A Business Lesson from the Three Little Pigs

One of the most important business moves an entrepreneur can do is make sure that their business is grounded upon a solid foundation. Just like a house, a business cannot survive in an unstable environment or on shaky ground. If for some reason an entrepreneur ignores this concept and moves forward to build their business on uncertainty they are definitely setting themselves up for failure and loss. Trust me when I tell you that successful entrepreneurs know the value of beginning your business venture on the grounds of stability.

Interesting enough, when I think of a business’s foundation I think of the story of the Three Little Pigs. I know this concept may seem a bit odd at first; however, after further analysis it makes perfect sense. As many of you already know each of the pigs built their houses in three distinct ways using three distinct types of materials. In the story, Pig number 1 built his house out of straw. Pig number 2 built his house out of sticks. Pig number 3 built his house out of bricks. In an effort to show the relevance between this story and an entrepreneur’s business foundation I will explain how a foundation built upon straw, sticks and bricks is relevant to entrepreneurial success.

A Business Foundation Built Upon Straw

Straw is the material that is left over after grain is separated from cereal plants. Typically, when you think of straw the thought of animal feed comes to mind versus house building. In the Three Little Pigs story pig number 1 used straw to build his house as a protective measure against the big bad wolf. However, the straw was not a strong enough material and the wolf was able to blow it down making the pig’s house irrelevant.

In the business arena the same fate would occur to an entrepreneur that decided to build their business on a foundation made of straw. Straw, without a strengthening agent is a very weak material. The slightest amount of pressure added to it and it will crumble to the ground. The best analogy to a straw foundation would be a business built upon fabrications. Fabrications could be anything from falsified financial statements, defective products, and other deceitful business practices. An entrepreneur that builds their business based on lies will eventually find themselves at the wrong end of the law; which could not only cost the entrepreneur their overall business but their reputation as well. Bottom line, building a business upon a straw foundation will more than likely have a detrimental outcome.

A Business Foundation Built Upon Sticks

Now, if you are anything like me, you are wondering if a straw house did not work for pig number 1 in the Three Little Pigs Story, then why would pig number 2 build his house of sticks. Well, it’s due to the same reasons entrepreneurs that have had failed businesses in the past repeat the same mistake in their current business. Neither party seemed to have learned their lesson despite the losses. Now unlike straw, sticks have a bit more stability but will still have the same outcome despite this fact. Sticks in the business sector are entities such as non-existent business strategies, irrelevant mission and vision statements, and other overlooked business foundational principles. If an entrepreneur fails to have these key entities in place within their business then the business is bound to fail just as quickly as a business built upon lies and deceit. The result of building a business on a foundation of sticks means that the entrepreneur failed to plan and as a result they subsequently planned to fail.

A Business Foundation Built Upon Bricks

Now pig number 3 understood the value of building his house on a solid foundation. He even accounted for the fact that the other pigs built their house out of mediocre materials and would need a place to stay once it all came tumbling down. As an entrepreneur this is the mindset that is needed to build a business on a foundation of bricks. Bricks can be categorized as investments, information technology, key stakeholders, strong organizational structure, and other business functions that lead to maintaining the competitive advantage. In order to succeed an entrepreneur must build their business on these solid foundational principles. Just like in the story of the Three Little Pigs a house build upon bricks can withstand the harshest of elements and will not fail in the face of uncertainty.

If you found this article intriguing and would like to know more about how building a business on a solid foundation will be beneficial to your success, feel free to click the link below.

Enjoy Your Journey!

Laying Your Business Foundation – Part One

The current economy is driving more people to start their own business and rightfully so. Business ownership signifies that you have taken the reins of your own destiny. The unfortunate aspect of this decision is that many people are not prepared for what it takes to be a business owner. You’ve read the articles through media blasts and other sound bits. Start your business in as little as three days. Earn more by working for yourself. Take control of your life by working for yourself. Spend more time with your family and friends. The list goes on and on and on. Although there is a great deal of truth to this but let’s be honest. Business ownership is not as glamorous as the media portray it to be. If you decide to take the plunge into business ownership I personally guarantee you the rewards far outweigh the temporary setbacks, delays and pitfalls. I’ve been a successful business owner since 1987 and believe me if I would have known about “how to” do anything in business Warren Buffet and I would be entrepreneurs co-mingling. I learned through “trial and error” which is very time-consuming and incredibly expensive. Thankfully, your business will not start out dysfunctional. Listen, learn and duplicate what is already established and functioning properly.

In this article I will show you “how to” Lay Your Business Foundation.

  1. Decide if you want to be in business. This will shave off 10 seconds of your precious time within a 24-hour window. This is very important because most people in business missed this point. They started doing something without thinking or planning and one day all the pieces did not fit into the puzzle. And those missing pieces goes back to the drawing board called decision. Our thoughts dictate the outcome. Think about it, did you start reading this article out of boredom your where you thinking about starting a business? I think the latter answer is correct or you will probably be somewhere else.
  2. What type of business? You know what enjoy doing so why not turn it into a profitable business. Now before you take the bull by the horns make sure this business is something other people need and want. Never assume what you like is something other people will pay their money for. Always see from the prospects lenses. If they like your product or service duplicate and legally protect it as quickly and accurately as possible. What you have done is taken a hobby, thought or idea turned into a profitable business.
  3. Location. Do you want a home-based business, store front or virtual business? See why I started off with question #1 and you thought I was being a smarty. These are the kind of decisions only you can answer. Although each of these businesses are somewhat similar each one functions differently. Here’s what I mean. Home-based businesses is operated from your personal dwelling; therefore, no overhead costs unless you build onto the existing structure. Let’s keep this simple! Either location will require some type of license to operate your business. a.) For home-based businesses check with your municipality for city or county business license requirements; b.) Store front locations will definitely be required to have a business license among other permits, etc. Again, check with your city or county municipality for requirements and; c.) Virtual business licenses can be tricky. Since you are not physically operating from a physical location or home-based a license is probably not required; however, whenever filing taxes you will either use your social security number or obtain an employer identification number (EIN). If you choose the later and use a company name then you must obtain the proper licenses and or permits to operate your virtual business. Note: An occupational license may or may not suffice to operate your business. Again, check with the municipality in your locale for business license and or permits.
  4. Financial Resources. Regardless of the size, location or dimension of your business, having MONEY is essential. I know you’ve heard that it doesn’t take money to start a business. Whomever or wherever you heard this is emphatically wrong. Look at it this way. Can you go into a store and make a purchase without funds? The answer is NO you cannot; regardless if you used a credit or debit card, cash and another acceptable method once it arrives at the financial institution it is converted into CASH. Make sure you, an accountant or someone you trust that is money savvy to look over your finances before you take the plunge. If the funds are not there WAIT until you can afford to go into business. Trust me I started my first business with $75 I borrowed from a bill I owed to a debtor. This made me very ill because I did not have enough cash to float me from one crisis to another. Note: Being strategic about starting a business is imperative to your life long plans. If you do not have enough cash I strongly advise that you wait until you do. Another option is to start with a small investment from the dollars you loosely spend on things that do not yield you a return on investment.
  5. Supplies and Equipment. Make not mistake you will need both. For a small home-based business your office supplies/equipment yearly average is about $2500+. Keep in mind costs vary according to the type and size of your business. Your supplies/equipment list can be placed on an excel spreadsheet or another suitable software that is comfortable for you. Here is an example of each heading: Description, Amount, Costs, Frequency, Vendor, etc. This will get you started then incorporate other headings as you grow.

Business Foundations – Setting Strong Foundations for More Business

Before you start making those calls and seeing more clients, you must be fully prepared to get the business. Although you may be eager to close more sales, there are several things to take care of before you’re on your way to achieving your sales goals.

Imagine building your dream house. The first thing you would do is pour cement into the ground to create a solid foundation on which to rest the house. Once the foundation is in place, you’ll be ready to build a dream house that will last forever. It’s the same with growing your sales and building your client list. When you have a strong foundation in place, you’re powerfully prepared and confident to call on prospects, and go after new business.

The foundation to bringing in more sales is made up of the following 4 key qualities:

  1. Acting from Integrity
  2. Taking Responsibility
  3. Keeping Promises
  4. Creating a Plan

Successful people embody these 4 qualities consistently in their lives. Let’s take a look at each of these qualities and how it works.

  1. Acting from Integrity. When you’re a person of integrity, you value and honor the word you give to do something. You are someone who is being accountable, trustworthy and honest. If you say you’re going to deliver your product by a certain date, you deliver it by that date. If you say you’re going to make 30 calls a day, you make those calls each day. You never step over anything with anyone including yourself. When you live your life from integrity, you experience freedom and power that impacts all areas of your life. Success begins with integrity.
  2. Taking Responsibility. When you take responsibility for your actions, you give up any reasons or justifications not to do something. As Brian Tracey, well-known author and speaker says, “The mark of excellent people is that they refuse to make excuses, blame others, or complain about their situations. Instead, they say, over and over, I am responsible!” When you’re being responsible, you know you’re the one to get the job done and expect no one to do it but yourself.
  3. Keeping Promises. When you make a promise, you are stating your commitment to the result. Your word becomes action. Your promise supports your commitment rather than your mood. It engages you as a player in life, and you cease to be a spectator watching from the stands. When you give your promise to another person, you are holding yourself accountable to that person. It’s now out in the world and becomes more real for you. This is true for all aspects of your life. You will see your sales increase when you keep your promises.
  4. Creating a Plan. When you create a sales plan, you are designing the steps that will lead to achieving your goals and keeping your promises. With a clear and specific plan in place, you have a road map to follow that will get you where you want to go with an end in sight. A well thought-out plan helps you to be organized, focused, and on track to reach your sales goals.

I invite you to start putting these qualities into your day-to-day business and see the results that will follow. You will be surprised at how much success you will achieve.

ASSIGNMENT

Your assignment this week is to answer the following questions and fill in the blanks:

  • Acting from Integrity. What did you say you would do this week to grow your business? Was it making sales calls? Was it getting out there and networking? Are you doing what you said you would do?
  • Taking Responsibility. Are you taking responsibility for doing what it takes to increase your sales and close more business, or do you make excuses or blame others?
  • Keeping Promises. What promises are you going to make today to call more prospects, meet with more clients, and close more sales? Think of 3 promises you are willing to make this week to sell your services, and write them down.
  • Creating a Plan. What 3 steps can you outline that will help you achieve your sales goals? Write down: “I will do the following action steps that will help me grow my business. They are (you fill in the blank).”

By implementing these 4 key qualities in your life and your work, your foundation is firmly in place and you’re clearly on track for producing breakthrough sales results!

Have a great Sales Breakthrough week!

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Business Coach Explains To You How Build Solid Business Foundations

Make sure you have solid foundations.

Have you ever seen a skyscraper being built?

The first thing they do to build it is to dig down.

It’s a little strange to see, but it makes sense if you think about it.

By digging down and making sure all the foundations are in place, and making sure they are rock solid… the building can then reach up towards the sky.

Without the rock solid foundations the building could topple and crash to the ground.

Unfortunately that’s what happens to some businesses.

Some owners neglect, ignore or are ignorant of some of the ‘foundations’ that MUST be in place to allow the business safe and secure business growth.

The things we are covering aren’t as exciting or as ‘glamorous’ as the topics that most business owners want to delve into like marketing, or team training… yet the areas are fundamental to the success of your business.

And they are topics that all multi-million dollar business owners are great at… and follow religiously.

Although they aren’t as glamorous – they are still fundamental to the successful growth and in some cases – the existence of your business.

So please don’t fall into the trap of ignoring these areas like some business owners do – because you can find yourself in serious trouble.

Insurances – Go over the kind of insurances that you need, and your business needs in case of any form of mishap, act of god and/or litigation. There are some critical ones that you need to be aware of. And there’s some that you may not have thought of that are fundamental to your business. So check them out and put them into place.

Contracts – How good are the contracts you have in place? Do you have any? Do you have them with your team and suppliers?

Make sure you’re working with a good contract lawyer to make sure you’re adequately protected in your contracts. Don’t just copy other people contracts; get them done specifically for your business.

Disclaimers – With the increasing rate of litigation make sure you are working with your lawyer to protect yourself from any type of litigation that may occur.

Technology – Find the appropriate levels of technology for your business so you can become more effective and efficient with your current workloads… and make sure you’re continually taking care of your current technology and updating regularly before the need arises.

Technology is only a cost if you don’t use it. When you use it, it’s an investment.

Software – When you start off in business you can get away with rip off versions of software. Yet when you’re aiming to grow – get the real versions.

I recommend it.

As you start to grow and you’re producing data that’s becoming more and more valuable you need to protect it and have constant support and access to it.

If you don’t have the ‘real McCoy’ you can say goodbye to sometimes years of hard work.

Back ups Virus Protections – Make sure you’re following the guidelines of backing up your data and keeping up-to-date virus software as well.

The data on your computer has taken you and your business literally thousands of hours at around $20 per hour. So you’ve probably got $100K or more worth of data on your system. Back it up, and store it off site.

If you’re online – you’ll know how many viruses are around. So get yourself a great system and update it daily.

I use Vet and I update it daily.

Correct Asset Protection – There’s no point making great money and building wealth if – seemingly at the drop of a hat – you lose it all. It happens because of poor asset protection. Make sure your assets are protected.

Get yourself a good asset protection lawyer and accountant.

Statutory Obligations – Be aware of all the statutory obligations that you have of running and owning a business – and comply with them. It’s the law.

Taxation – Make contact and work with the tax office often to understand all the different forms or taxation that you and your business are subject to. Know when payments are due, budget for them and make sure you get everything in on time.

Rateable Remuneration – As your business grows and you employ more and more people make sure you’re updating your rateable remuneration with WorkCover. Otherwise you can be stuck with an unpleasant bill or even be fined.

Time Off – Like the axe man that cuts wood. You’ve got to take time off to sharpen your saw. Otherwise it just becomes blunt and ineffective.

Time off helps charge up your batteries – and it also makes your team step up when you’re away.

Regular time off will have you feeling fresh and ‘on-the-ball’.

There may be many more things that you can do for your business to make sure you have nice strong foundations in place for growing your business.

Go through all the potential areas and topics that are specific for your business – and make sure they are in place. That way you’re geared up for growth.

Copyright © 2006 by Casey Gollan. All Rights Reserved