Small Business Questions Answered
I get up early—real early. Typically, I’m the first person in line at the local Starbucks when it opens at 5am. I’m normally the only person in the store, but the other day there was a young woman sitting—coffee in hand already—reading Norm Brodsky’s book Street Smarts: An All-Purpose Tool Kit for Entrepreneurs.
Norm’s book is one of my favorites, and I said as much to the young lady. She explained that she’s starting a new business and is reading Norm’s book at the recommendation of a friend. I told her a little bit about my background and Blue Corona, and she asked if she could ask me some questions. I’m always down to talk business, so I obliged.
What follows is a rough transcript of our conversation and some tips I think all entrepreneurs and small business owners can benefit from reading. Considering that it’s also National Small Business Week, I think this is particularly timely:
Question: What do you think about business plans? Did you have one when you started Blue Corona? Should I create one for the business I’m starting?
I think most people create them too early. No, I didn’t have one when we started Blue Corona. If you’re asking whether you should, you probably shouldn’t—not yet.
A lot of first time entrepreneurs believe that you must have a business plan in order to start a business, but that’s simply not true. We didn’t have a business plan when we started Blue Corona, and while I might have been a naive first time entrepreneur, my partner had previously started multiple, successful businesses, and he happens to have an MBA from a little school in Massachusetts that rhymes with Blarvard.
If you’re going to finance your new start-up with your own cash, I would skip any formal business planning and jump right into doing the real work. By real work, I mean selling your product or service, no matter how rudimentary; getting feedback and data from real customers, and tweaking things accordingly.
At Blue Corona, we did this for more than a year. Then, once we had some real data, we created a growth plan. A growth plan is like a business plan except that it includes a lot of real numbers, where a business plan would have contained guesses. The more guesses you can replace with real data, the better your odds for creating a successful business.
Of course, if you are raising money from outside investors, you will likely need a formal business plan.
Question: Besides Norm’s book, what other books do you recommend?
Some of my favorite books are:
- The Great Game of Business by Jack Stack & Bo Burlingham
- A Stake in the Outcome by Jack Stack & Bo Burlingham
- Winners Dream by Bill McDermott
- Up the Organization by Robert Townsend & Warren Bennis
- Simple Numbers, Straight Talk, Big Profits by Greg Crabtree
- The Hard Thing About Hard Things by Ben Horowitz
- Every book Patrick Lencioni writes
- The Real-Life MBA by Jack and Suzy Welch
- Buy-In by John Kotter & Lorne Whitehead
- Crucial Conversations & Crucial Accountability by Al Switzler, Joseph Grenny, Kerry Patterson, & Ron McMillan
- Life with a Seal by Jesse Itzler
I read a lot of business books, and I think every business professional should be a voracious reader. That said, I think every small business owner needs to recognize that the secret to building and maintaining a great business is this: there are no secrets. There is no magic formula or one-size-fits-all approach.
You build a great company by showing up every day; using the data you have to make decisions; analyzing the result of the decisions you make, and adjusting accordingly. Too many struggling small business owners mistakenly believe there’s a silver bullet or that if they only adopt The E-Myth, all their problems will go away.
One needs only to look at the history of the business of The E-Myth to see the flaws in this way of thinking.
Question: What’s the biggest lesson you’ve learned since starting Blue Corona?
The single biggest lesson I’ve learned since starting Blue Corona is the power of re-framing—taking a situation and looking at it from a different perspective. There’s a specific section of Norm’s book that speaks to this perfectly. It’s summarized in this Inc. Magazine article.
When you’re running a business, you face a never ending stream of issues. The bigger your business gets, the more issues you have.
As Norm says, “It’s easy to get overwhelmed by the flood of problems you encounter when you first go into business. The typical reaction is PANIC. To be successful you have to get over your panic. How? By getting caught up in the excitement of finding solutions.”
This is an example of the power of re-framing. Problems are exhausting. Solving puzzles is a game, and games are fun!
Re-framing isn’t just valuable for addressing problems; it’s also important for preventing them from ever happening. As they say, “you are what you think.” As hokey as it sounds, the fastest, most direct route to a better business and a better life is to focus your thoughts on what you want—not what you want to avoid.
Question: What’s the best way to get new customers? SEO? Facebook? Direct mail?
Because I run a marketing company, this is one of the first questions business owners ask me. Everyone wants to know which works better—pay per click or SEO; social media or email; direct mail or TV.
These are all marketing channels. The best way to get new customers is to put in place a specific process to advertise and market your business—specifically, you need to TRACK > TEST > TWEAK > REPEAT.
Marketing channel performance is constantly fluctuating based on competitive factors, marketer’s tactics, industry-factors such as weather, and much, much more. Some businesses get lucky and they find an underutilized and undervalued marketing channel, and they’re able to generate a positive ROI from it for years. But eventually all good things come to an end.
Instead of viewing “the best way to get new customers” as “which works better—SEO or Facebook?” look at it as a process. Put the right analytical tools in place so that you can measure and track all your advertising campaigns and marketing channels.TRACK every campaign and channel individually, and review the data often. TEST new campaigns and new channels. TWEAK your future tests based on the data you collect. REPEAT the process.
This process is the best way to get new customers.
I hope you found this helpful, and considering that I’m now out of coffee, I’m heading back to Starbucks for a refill. If I run into another curious entrepreneur, maybe I’ll follow this post up with a part 2!
About The Author: Ben Landers is the President and CEO of Blue Corona, a data-driven, inbound internet marketing company. Submit an inquiry to book Ben to speak at your next conference or event.
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