look at some of the main qualities that successful entrepreneurs tend to possess. You don’t have to have them all, but your chances of success increase every time you say “That sounds like me” to the following descriptions:
• Successful entrepreneurs love what they do. Because they are doing work they enjoy, it doesn’t seem like a job or a chore to them. This is what keeps them going during the tough times, when they have to work late nights and meet tight deadlines.
• They are not daunted by hard work. It is not easy to research, start, and run a small business. Making the dream a reality takes a lot of time and effort. Entrepreneurs are not afraid to work hard.
• They are inquisitive and interested. They are always reading and talking to other people about their interests and experiences, and they like to keep up with current trends and events. This is how they increase their personal contacts and discover “what’s next” for their businesses.
• They like to deal with people. It doesn’t matter whether the business produces goods or services, entrepreneurs need to deal with a broad range of people on a daily basis — from customers to suppliers to business partners and employees. They need to enjoy dealing with people to make things run smoothly.
• They thrive in unstructured situations. They generally don’t like to be told what to do, when to do it, and how to do it. They enjoy the challenge of making all the decisions themselves.
• They have good communication skills. Whether it’s writing business proposals, talking to a bank manager about a loan, or convincing a potential customer that their product is superior, they are able to get the point across effectively.
• They have a supportive family. They have the support of their family and do not ignore the importance of their lives outside the business.
• They can cope with a fluctuating income. These people realize there may be some years when their income is low. They plan ahead for these times so they don’t put the whole business at risk — and they are confident things will get better.
• They have (or can develop) necessary skills and experience. They are not afraid to face their limitations, and they are prepared to acquire the skills they don’t have or to hire people who already have them.
• They recognize the value of good health. Long hours and stressful situations take a lot out of you. These people realize the importance of regular exercise and a healthy diet.
Now that you have thought seriously about your own personal attributes, you have likely discovered you are not perfect. But if you are resolved to work on your weaker areas, you will improve your chances of success as an entrepreneur. The next thing to consider is the attributes your business will require to succeed.
Attributes of a Successful Business
Throughout my years of self-employment, I have seen hundreds of businesses come and go. This has given me an interesting perspective on what basic elements a business needs to succeed. I have concluded that a successful business is like a stool with three legs to keep it stable. They are —
• operations,
• selling and marketing, and
• finance and administration.
In order for a business to succeed in the long run, it needs to be actively engaged in all three functions. Let’s look at each and see why.
Leg 1: Operations
The operations section of a business is the actual work that the business does. For a plumber it’s fixing people’s sinks and tubs. For computer consultants it’s programming clients’ computers or providing technical services. For bookkeepers it’s keeping the books for clients’ businesses. It’s obviously vital that you be able to perform the work of the business. At least, it’s vital until your business grows enough to be able to pay someone else to do the work for you.
Operations is where most people have the least amount of trouble. Unless you decide to start a business that you know nothing about — which is a risky strategy — you probably have the skills you need to do the work of your business.
In Chapter 4, when I talk about how to sell yourself and your business to clients, you’ll see that it’s essential that you be good at what you do. If you are good, word will spread to other customers. If you aren’t, it won’t. In fact, if you don’t provide good services or sell good products to people, bad word-of-mouth will spread, and that will almost certainly kill your business before it begins to walk.
Most people who start a business know already how to do the work of the business — the operations part. They have one leg of the stool. Note that two types of businesses have a major advantage over all others because their operations involve one or the other leg of the stool:
• Bookkeepers and accountants generally have no trouble with finance and administration.
• Advertising executives and consultants usually have sales and marketing skills.
If you are thinking about starting one of these types of businesses, you already possess two-thirds of the skills you’ll need to succeed. If your business is in any other field, you’ve got more work to do.
Leg 2: Selling and marketing
The second leg of the stool is selling and marketing. This is definitely my weak point. I was never taught how to sell or market anything in my life. I think this is one of the greatest flaws in the North American educational system today. No matter what we do, we need to be able to sell to be successful. Why aren’t we taught how?
Everything I know about selling I learned one of three ways:
• By making mistakes myself
• By learning from clients who know how to sell
• By listening to, and reading books by, people who know how to sell
I discuss selling and marketing in Chapter 4, so I won’t get into the details here, but think about it for a moment. You may be great at what you do. You may even be the best in your area. But how are you going to be successful, or even survive, if no one knows you exist?
The simple truth is that you need to think about what sales skills you have. If you don’t have these skills, are you willing to work on them? If you are shy, are you willing to venture out and take some classes or attend networking training, such as Toastmasters? If the thought of selling scares you to death, you’ll need to consider how you will get over this huge obstacle. If you are motivated, you can surmount it to some degree by reading books written by people who know how to sell. However, if you truly believe you will never become proficient at selling, you may have to find an associate you can work with who does know how to sell.
Leg 3: Finance and administration
This area is a strong suit for me, as you might expect. It’s easy for me to keep accurate books, make sure bills and taxes are paid correctly, and file annual income tax returns as required. What about you?
I can’t stress the importance of finance and administration enough. I’ll even spend all of Chapter 6 talking about how to keep financial records.
Sadly, I have watched many businesses fail. One of the traits they shared was lousy financial records. They had receivables so old there was no chance they would ever collect any money. They owed back taxes and had been assessed late-filing penalties and interest charges by the government. They had received many “demand for payment” letters from suppliers and, in many cases, nasty letters from their banker asking when the line of credit was going to come down.
The people running these businesses saw their dream of self-employment turn into a nightmare. Not only did their business fail, but they were often left in