Sunday, November 25, 2012

Three Good Reasons for Going Into Business – Not!

This article was written by Mike Capsuto, SCORE Orange County Business Mentor

imageThe most common reasons people express a desire to go into business are:

  • Financial security
  • Job security
  • Become their own boss.

None of these are entirely good reasons.

First, it takes three to five years of intense work and frustration before a business generates sufficient cash flow to provide a comfortable level of financial security for you and your family. I once asked a businessperson how he became so successful. He said that it took years of hard work and having to overcome many failures to be an overnight success. He also said that it was financially well worth it.

Second, when self employed you start every morning unemployed. Sales do not miraculously appear at your door. You have to get out, meet customers and close sales before your competition does.

Third, there are many outside pressures preventing you from being entirely your own boss, many of which you never had to contend with as an employee, such as:

  • Expectations of family, investors and creditors
  • Compliance with local, state and federal laws and regulations
  • Skills of the labor supply
  • Changing technology
  • Lack of financing
  • Customer demands
  • Competition

With all these conflicting factors, how does one become successful?

Though important, success does not entirely come by forming a business entity, conducting market surveys, writing a business plan, etc. as literature may suggest. Businesses are run by people and their personalities.

Do you have or had an activity in the past such as a hobby, playing golf or any other fun pursuit that got you excited? You could not wait to get started. You looked forward to facing the competition. You had no fear of failure yet, every time you failed, you created new winning strategies. People were attracted to you by your energy. Successful entrepreneurs have similar personality traits and understanding these traits will increase your chances of your business succeeding.

· Emotional Intelligence: All clients or customers have a level of anxiety when dealing with your business. They are thinking: “Can I afford it?”; “Is it healthy?”; “Can I find it elsewhere for less?”; or “Does it make me look fat?”. Successful people have a high level of emotional intelligence. They have the ability to identify and understand a customer’s emotions and communicate in a positive way in to overcome their anxieties. This understanding of emotions helps you relate better to other people, forming strong business relationships and achieve greater success. Some literature call this the Likeability Index.

  • Persistence and Confidence: Many successful people failed more often than they had successes. They treat each failure whether large or small as a new learning experience. Adjusted their approach and went after the solution with enthusiasm. More people fail because they just give up. Believe in yourself and continue to try even though giving up seems the simplest solution. If you give up it will always be in the back of your mind “What if I had done ….”.
  • Creativity: Creativity is the ability to solve problems in new and interesting ways. Whether you are developing new business strategies, improving daily operations or finding ways of resolving a customer’s problems, creativity will allow you to find the unique solutions for success.
  • Ability to Handle Fear: Fear holds people back. People don't try due to the fear of losing money, making a costly mistake, ridicule from family, friends and peers, and the fear of not having a regular pay check. Others have fear of meting people and having to sell them on your product or idea. To not to try is the same as giving up. Successful entrepreneurs have fear. They have learned to become educated about their problems and suppress that fear when times are difficult.
  • An Inquisitive Nature: People succeed because they have the ability to ask why? They want to know why something happens and move to improve that method. Their inquisitive nature allows them to achieve a deeper understanding of problems faced in their business and in turn allows them to become more efficient. They solve problems by asking why?

If you define your business as a fun pursuit, the business will have its own momentum. Your attitude will change from the stress of having to make your business grow to knowing that it will be growing on its own, and you will be enjoying every minute of it.