When people are looking at business ownership, they are in one of two positions. Like my story, I’d say about 15 percent are just coming out of college and are full of a “taking on the world” attitude.
But that segment is certainly the minority. The substantially larger group, from my experience, does so because they were forced to. Most people say they would like to own a business, but the truth is that most people never start one. It’s only because of a layoff or downsizing that they ultimately say they don’t want another J-O-B.
Like me, most entrepreneurs have found starting out in business to be much harder than originally thought. However, reaching this stage of business ownership, it’s much more rewarding — both financially and emotionally.
Whether it is adding a new brand to your holdings, adapting an existing operating model, or making leadership changes in your organization, I want to share four strategies that have helped me over the past three decades:
- Have a plan. You don’t know if you’re achieving success unless you have a written plan. This allows you to organize your vision and outline strategies to achieve your desired results. Secondly, the act of planning helps to make you accountable to tracking your progress against your goals. Remember, it is not uncommon for plans to require updates as conditions change. I was asked recently if my career looks the way I predicted it would when I began at 24 years old. It’s entirely different, but that’s OK!
- Be determined. An unbelievable amount of determination is required to be successful in business. There are unimaginable road blocks that creep up, whether you’re starting a new business or you’ve been established for many years. The ability to have a goal and adjust to conditions such as competition, the economy and technical advancements showcases your positive mindset on achieving your set goals – even if the pathway to get there has to change.
- Recruit a board of advisors. Having a group of professionals whose judgments and recommendations I trust and treasure has been crucial to my business success. Look at the areas where you struggle and look for skill sets you need help with in finance, insurance or marketing. Go after high-level experience in the areas you need help with. It’s amazing to me that when I started in business, by just asking someone a question, they were willing to help. I have asked people at the top of their industries to give me an hour a month and they happily agreed. I’d tell them what was going on in my business and then listen to their advice. Share your written plan from step one with those who are willing to hold you accountable.
- Amass enough working capital. Having enough money, from launch to break-even, is important for a new venture or strategic investment in your business. I’ve learned that whatever number you have in mind, you should double it. I like to compare working capital in business to the space shuttle. In business, it’s money and with the space shuttle, it’s fuel. If you only put three quarters of fuel in shuttle’s tank, it will only go three quarters of the way to orbit, which would have a horrific ending. The same is true in business. You must have enough working capital to get the business into orbit. In business, orbit equates to cash flow, breakeven and producing a profit so the business becomes self-sustaining, and in space, it means free travel in zero gravity. Enjoy the ride!
David McKinnon is the co-founder and chairman of Ann Arbor, Mich.-based Service Brands International, an umbrella organization that oversees home services brands, including Molly Maid, Mr. Handyman, 1-800-DryClean and ProTect Painters. To contact him, email [email protected]