Now that the economy is rocking and rolling, you’re increasingly likely to meet a starry-eyed human babbling on about becoming a business owner.
Probing for the object of this person’s entrepreneurial infatuation will precipitate what, where, how and when questions and, finally, the most important question: Why do you want to own a business? Answers to this last question, unfortunately, often produce what I call “The Myths of Small Business Ownership.” Here are the four most prominent ones:
Myth 1: When I’m an owner, I’ll be my own boss.
That’s right; you won’t have an employer telling you what to do. But you’ll trade that one boss for many others: customers, landlords, bankers, the IRS, regulators, even employees.
Modern management is more about inspiring, leading and serving than “bossing.” In a small business, everyone must wear several hats and the dominator management model doesn’t work well in this 21st-century multi-tasking environment.
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Personal service businesses: Think prices, not wages
Millions of small businesses sell personal services like consulting, website development, or janitorial services, instead of something tangible like a computer or a kumquat.
Unfortunately, pricing a service is not as intuitive as a tangible product. Consequently, service businesses too often don’t charge enough to sustain themselves profitably because of how they think about what they sell to customers.
Don’t make the professionally fatal mistake of comparing what you charge customers to deliver your product — a service — to how much you would expect to make per hour as an employee. Doing so, to paraphrase Mark Twain, is like comparing lightning to a lightning bug. You must think like a business, not an employee. You have to think pricing, not wages. Here’s why:
1. You’re a business now, which means you offer customers a price list, like you would see on a wholesale catalog or a restaurant menu, not a wage list. And you collect revenue, which is what businesses produce to create the gross profit that pays expenses, including the salaries, taxes and benefits of employees — and owners.
Five year-end steps to take while closing out this year
Fourteen hundred and forty — the number of minutes in a day. Since we can make more money, arguably the greatest challenge of any small business owner is balancing the demands of the forces that compete for those minutes.
“What is the best use of my time right now?” is the constant management question out here on Main Street. And in no other part of the year are we more time-management challenged than in December. The reason is because it’s the only month in the year where we’re faced with allocating time to two very powerful management imperatives: The tactical focus on closing out the sales year as strongly as possible, while simultaneously taking strategic steps to set the business up for a fast and clean start on January 1.
In his book, Blue Highways, William “Least Heat Moon” Trogden said his Osage Indian grandfather once told him, “Some things don’t have to be remembered, they remember themselves.” It’s a natural law that the year-end sales push doesn’t have to be remembered, it remembers itself. But as we come to the two-minute drill in the fourth quarter of the marketplace game our business plays all year, committing precious time and energy to prepare for what comes next requires the discipline and devotion to remember it ourselves.
There are many areas to focus on this month to help you start the New Year clean and fast. But here are five to get you started.
When cause-and-effect met humanity
As the 17th century dawned, cause-and-effect was merging two parallel universes.
In the Old World, a group of Leiden Separatists was making decisions that would put them on a circuitous journey. Meanwhile, in the New World, a manchild named Tisquantum was born to the Patuxet tribe of the Wampanoag Indians.
Both the Separatists and Tisquantum became very important to the future of mankind, but not before their lives would change and intertwine in ways not to be imagined by the inhabitants of either world.
In search of religious freedom, the Separatists crisscrossed Europe and then the Atlantic Ocean. On their odyssey, the Separatists would steel their convictions, which would prove handy in the New World.
Incredibly, first as a hostage and later as an interpreter, Tisquantum crossed the Atlantic six times. On his odyssey, Tisquantum learned Old World languages that, combined with his New World survival skills, would contribute to his rendezvous with destiny.
On Veterans Day, let’s recognize all who served
Veterans Day has its origins in Armistice Day, which was first acknowledged by President Wilson in 1919. The first anniversary of the signing of the Treaty of Versailles took place “in the eleventh hour of the eleventh day of the eleventh month.” Congress made Armistice Day a national holiday on November 11, 1938.
Alvin King, a small business owner in Emporia, Kansas, had a problem with the name Armistice Day. Al was so moved by the death of his nephew, John E. Cooper, who was killed in the Battle of the Bulge during World War II that he, along with the Emporia Chamber of Commerce, started a movement to rename and redefine Armistice Day as Veterans Day. His goal was to expand recognition beyond those who served in WWI. The idea caught on and President Eisenhower made Veterans Day official in 1954.
But who should be recognized on Veterans Day? If you’re looking for the definition of a military veteran, good luck. There are several variations on that theme, since the veteran universe is primarily associated with financial benefits. Consequently, the government has a lot at stake in the official definition.
The gold mining tool of professional salespeople
Let me tell you a story about the most powerful tool in sales.
A few decades ago, a 27-year-old, shiny, new Xerox sales representative was minted. Already a sales veteran, it wasn’t his first rodeo. Indeed, he worked his way through college selling on commission.
Commissioned salespeople, like entrepreneurs, work the marketplace high wire. Observing this act, a salaried employee once remarked that selling on commission was “living by your wits.” In the vernacular, business-to-business sales professionals know “you eat what you kill.”
Pre-Xerox, this salesman received rubber-meets-the-road sales training from the small business owner who gave him his first commissioned job, followed by a multi-year stint with Sears, where more sophisticated sales training was acquired. And finally, he survived the rigorous hiring process and completed the Xerox Professional Selling Skills program. PSS was globally recognized as the sales training gold standard, and any Xeroid of that era will tell you of its positive professional influence on the rest of your life.
With the ink barely dry on his PSS certificate, our young Xerox salesman made one of his first calls on the local installation of a national firm. He was now a fully converted, Kool-Aid-drinking disciple of Xerox sales fundamentals, and his head was packed with product, pricing and probes. Unfortunately, as he sat in front of Mr. Keener, the plant accountant, all of the professional probing techniques and listening skills our sales executive had learned and practiced were no match for the cargo of content he dumped right there on Mr. Keener’s desk, like a truckload of, well, you know.