Business Planning Start-Up Guide
Before we begin, ask yourself these two questions: (1) What is your underlying personal why? (2) What are your external whys? …The whys other people want from you?
This looks easy, but there is more to this than you think. In fact, this is one of the most essential components to your long term business success and happiness.
I’ll explain it a little below, but I recommend a great book on this subject, Start With Why by Simon Sinek, Portfolio Trade, Reprint edition, December 27, 2011 (Amazon link).
Let Me Explain
Warning: You may be thinking, “Yeah, yeah, I already know the “why” and just want to get started.” Do yourself a favor, really give this some thought. If you don’t, you may find that you’re struggling to make your business work because your heart isn’t into it. Or you’re an achiever and doing well, but you feel empty.
I’m not saying that you have to turn your hobbies into a business. Sometimes, hobbies should stay that way. I’m also not saying that it has to be what you always dreamed of. I don’t believe that either. Sometimes we have a strong “why” that may not be our dream but it motivates us.
What is Your Underlying Why?
What I’m asking is this: What are your true motivations. Let me give you two examples:
Bob is a carpenter and his wife wants him to be a general contractor. The problem is that Bob don’t like managing things or people: He doesn’t like bidding on projects and hiring sub-contractors. But, he does it anyway because it sounds okay. I mean, his wife will be happy with his decision. Right?
What’s life like one year from now? Bob is doing okay, but getting out of bed in the morning is a struggle.
- Take that same carpenter. Instead of doing what his wife wanted, he discusses it with her and discovers what he really likes doing: He loves solving problems and fixing things. So, he starts a fix-it or handyman service. He goes into it and loves it. He’s fixing things. He’s building things. He simply loves his craft and being on his own.
What’s life like one year from now? He jumps out of bed each morning and enjoys the projects he gets to work on.
She Never Dreamed of This – But It Fits Her Perfectly
Sometimes we have other “whys” besides fulfilling our creative dreams. We may not like the trade or profession, per se, but we like the independence of being our own boss and having time freedom.
- Jill loves spending time with her family and raising her children. She also values her freedom. But, she never expected to own a septic tank and port-a-potty business. She never, ever dreamed of pumping septic tanks and cleaning potties. However, she loves being her own boss and having the free time to be with her family. Heck, if she needs more money, she hustles up more business. It’s perfect!
Which “why” is important to you? What is it that you want? What is it that others want from you? Often it’s not either or. However, if you can reconcile the two you will likely find something you’re interested in and something that pays the bills. Perhaps a personal antidote will make the point.
When I Should Have Listened to Me
I started a real estate multiple listing service (MLS) for the for-sale-by-owner home seller. On paper a flat-fee MLS service looked like a good fit and winning idea. I am a licensed real estate broker and though I wasn’t seeing clients, I did keep my license active. Keeping a active license meant taking classes and spending money to meet the state’s requirements. So an online flat-fee MLS service sounded like a great idea – it could at least pay for itself, I thought. My reasoning was this: It wouldn’t take a lot of work and it might even provide a little extra income. You can read more about this in Nick’s Start-Up Projects, Test the Viability of Your Product or Service.
When I did the market research, it was winter and the real estate market in Idaho was “dormant.” It looked like an open market with the possibility of making some money. In the Spring, when the company began marketing, the competition was suddenly rampant. No one wanted to pay the price I set for my service. It appears real estate brokers use flat-fee MLS as a client conduit. They didn’t mind spending more that it cost to service the clients; because. they can always make it up when the customer decided to use a broker after all. It was a loss leader.
After two weeks and a few hundred dollars of Google Adwords marketing, I hung up the hat. I wasn’t willing to provide the service for a loss or the small fee I would have to charge to attract paying clients.
Lesson Learned – Which I Hope Helps You With Your “Why”
Looking back, I knew it wasn’t a good fit. I was uneasy about starting it up, spending money on it, and then I was a happy it didn’t work out. I’m trying to build businesses which I can manage and not work in.
The long-term prospect meant attending to low paying clients for up to six months at a time, and then being liable to any “issue” the buyer or seller had after purchase. In fact, I didn’t have any face-to-face interaction with the clients (it was all online) or any involvement in the real estate market – things that I’d enjoy doing.
My advice is to listen to that little feeling in your stomach or that little voice in the back of your mind. If it’s saying something listen to it. Don’t confuse that “feeling” with start-up jitters. I know the feeling wasn’t “the jitters” because its “failure” gave me insight to what I really wanted – and it wasn’t this.