I was talking to a young man starting a business the other day. He was very excited to be in business and ready to charge forward and make his mark. He has a service, a plan and is clearly willing to work hard to achieve his goals.
That conversation got me thinking about what would be the bullet points for running a successful business. That is, what ten things if mastered, would give a business the best chances for success? I know there are hundreds, but here would be my top ten:
- Everything has a cost.
- Figuring out the true costs of your goods and services should be the #1 goal of your business.
- Figuring out what you will charge people for your goods or services is the #2 goal of your business. Get #1 or #2 wrong for a long period of time, and you’ll be out of business quickly.
- Cost + percentage pricing for most businesses is inevitably less profitable than pricing based on the value to your customers.
- Make sure your business has some moats around key products. These might be exclusive distribution contracts, high-specialized skills (heart surgeon, artist, BMW-trained mechanic, ect.), extremely high barriers to entry for the competition, customization, etc.
- A one-person business is seldom going to provide exceptional earnings.
- Finding, training and motivating employees are the keys to growing a business. Money alone is seldom the top way to attract and retain excellent employees.
- You will be much more successful if you focus on bringing people up than putting them down.
- No business is an island, so treat your customers, suppliers, competitors, and community with respect and dignity. You’re all connected and need each other.
- When you own a business, you are responsible for everything. If you don’t want the responsibility for an amazing amount of issues-big and small-you’ll be happier working for someone instead of running your own business.