Starting A Business

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Starting a business is exciting and risky! This presentation addresses a few points a business start up needs to consider to be successful.

Starting a business is exciting and risky! This presentation addresses a few points a business start up needs to consider to be successful.

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  • Not going to give lists of government departments
    Talking about What you really need to focus on for starting & being successful in business

Transcript

  • 1. Starting Your Own Business A Primer For Budding Entrepreneurs Profitkoach - Business Growth Specialists
  • 2. Profitkoach Your Presenter - Brian Bijdeveldt • Business Coach & Consultant for 12 Years • Member of International Coaching Federation • Certified Business Coach • Facilitator For Marketing Programs Profitkoach - Business Growth Specialists
  • 3. Overview What we are going to talk about…  The Entrepreneurial Seizure  Why Do Businesses Fail?  How To Avoid Becoming A Statistic  Risk & Starting A Business Profitkoach - Business Growth Specialists  Summary  Questions
  • 4. The Entrepreneurial Seizure Profitkoach - Business Growth Specialists
  • 5. The Entrepreneurial Seizure • The technician/artisan/craftsman decides to go into business. • No systems • No financial control • No idea of marketing the business • Poor time management Resource – Michael Gerber – The E Myth or The E Myth Revisited. • The business is set up from the start as a vehicle in which the ‘entrepreneur’ can pursue their trade (social media guru, web designer, physiotherapist, etc). There is no exit plan.. Profitkoach - Business Growth Specialists
  • 6. The Story In Our Heads… • The dream of proving yourself and being your own boss • Out performing the pack. • This is the fastest way to realise all your goals and dreams of independence . • Any other way is too slow. • Success is mine! Profitkoach - Business Growth Specialists
  • 7. Business Or Employment? Business - potential Employment o Great Income/profit o Independence o Control of your own destiny o Challenge o Build a valuable asset o A terrific lifestyle o Wealth o Contribution o Steady Income o Security o Career Opportunities o Challenge o Structure o Contribution Which Has The Greatest Risk? Profitkoach - Business Growth Specialists
  • 8. Entrepreneur Or Technician? Entrepreneur Technician o Has vision, goals & mission o Defines Strategy/plans o Defines how the business will expand o Sets up business systems o Builds business to be easily managed o Works On the business o Tests and measures o Creates a job with overheads o Limits growth due to dependence on owners capacity o Builds a business based on their technical skills o Works In the business Which One Are You? Profitkoach - Business Growth Specialists
  • 9. The Good & The Bad WELL RUN BUSINESS o Profitable / high resale value o Owner works moderate hours o Required skills learned or outsourced o Owner can take time off o Operations are systemised o Cash flow is managed o Planned marketing/sales activities o Leverage employed POORLY RUN BUSINESS o Low/no profit - low resale value o Owner works long hours o Owner “saves” by doing everything o Owner cannot leave business o Adhoc delivery of services o “Lumpy” cash flow o Constantly chasing customers Which One Would You Buy? Profitkoach - Business Growth Specialists
  • 10. Why Do Businesses Fail? Profitkoach - Business Growth Specialists
  • 11. The Missing Pieces… Competition or lack of market knowledge Lack of financial planning and review Over-dependence on specific individuals in the business Owners concentrating on the technical, rather than the strategic work at hand Inadequate capitalisation (not enough money) Lack of management systems Lack of vision, purpose, or principles Poor market segmentation and/or strategy Poor time management Profitkoach - Business Growth Specialists
  • 12. Business Failure Rates Not A Nice Set Of Numbers… Years After start Up % Failed Cumulative % Failed Year 1 32 32 Year 2 17 49 Year 3 13 62 Year 4 7 69 Year 5 5 74 Year 6 4 78 Year 7 3 81 Year 8 3 84 From ABS and analysis by Rolffe Peacock 2000. • Failure rates decrease over time – the owners are learning! • Around 26% of businesses survive the first 5 years. Profitkoach - Business Growth Specialists
  • 13. What’s A Quick Way To Kill A Business? Hint: It’s A Financial Thing… Profitkoach - Business Growth Specialists
  • 14. Cut Off Cash Flow! Cash Flow…The Oxygen of Your Business • Debtor Management • Collect quickly/pay slowly • Access To Funds • Have extra cash or loan arranged • Inventory Control • Don’t tie up excessive cash in stock/equipment • Borrowings • High interest rates hurt! Profitkoach - Business Growth Specialists
  • 15. Avoid Being A Statistic “Your Business Is A Reflection Or Extension Of You” Profitkoach - Business Growth Specialists
  • 16. Perform A Self Audit… • Am I Passionate About (My) Business? • Am I willing To Work Hard? • Do I Have Energy & Drive? • Am I Persistent? • Will I Take Responsibility For My Decisions? • Do I Have A Plan For Success? • Am I Willing To Listen To Advice? • Am I Ready To Learn New Skills? • Can I Handle Disappointment? • Do I Like To Compete? • Could You Make “Cold Calls” For Business? Profitkoach - Business Growth Specialists
  • 17. Begin With The End In Mind… Define your Purpose • Your Vision, Goals, Objectives • Why You Want To Go Into Business • What Service/Product You Are Going To Offer Research The Market • Who You Are Selling To (The “Graphics” Demo, Psycho, Geo) • The Viability Of The Market/Trends – (can you compete?) • Surveys/interviews /trade organisations - test demand Learn about Time Management, Marketing & Sales Draft Your Exit Plan Plan On Building A Business That Is Sellable • Profitkoach - Business Growth Specialists
  • 18. Identify Skills Gaps… • Technician • Marketer • Salesperson • Bookkeeper • Administrator • Financial Manager • Supervisor • Trainer • Negotiator • Strategist • Creative Consultant Which Of These Roles Can You Outsource To Free Up Your Time? Profitkoach - Business Growth Specialists
  • 19. Manage Your Time… The 80/20 Rule • 20% of your activity returns 80% of your results • 80% of your effort delivers the other 20% • Plan to outsource the 80% tasks such as: • Bookkeeping & Administration • These consume valuable time • Whereas Marketing & Sales • Can generate Income Pay $20 an hour so you can make $100! Profitkoach - Business Growth Specialists
  • 20. Define Critical Systems The core systems of your business… Step 1. Dream -The vision , goals & Mission Step 2. Intention - Design the client fulfillment processes. Step3. Intentional growth – develop the lead generation and conversion systems. Lead Generation •Finding prospects •Marketing your business Lead Conversion •Convert prospects into customers Client Fulfillment •How will services/product be delivered •Client retention Marketing Operations Sales Profitkoach - Business Growth Specialists
  • 21. Financial Stuff… Work out what you will charge/prices Estimate Break Even Set Sales Targets Service Business Spreadsheet example Profitkoach - Business Growth Specialists
  • 22. Risk & Starting A Business It’s All About Risk Management… Profitkoach - Business Growth Specialists
  • 23. Risky Business… • Start a new business from scratch • Higher risk, lower entry cost (home based?) • Buy an existing business • Higher entry cost - existing cash flow & customer base • Buy a franchise (new or existing) • Systems already developed • Brand recognition • Proven model • Higher cost of entry • Ongoing fees and commissions How much capital do you have to • Less creative freedom (this may be a good thing!) What’s your risk profile? Which One Suits A Technician? Profitkoach - Business Growth Specialists risk?
  • 24. Other Considerations…  Ensure you have setup costs plus 6 months working capital  Have you accounted for living expenses as part of your working capital?  Don’t expect a business to be profitable in the first year  Understand liabilities such as leases Profitkoach - Business Growth Specialists
  • 25. Go For It! Prepare Before You Dare……. • Business is a tight rope and your job is to balance out the various roles and responsibilities that a business demands of you. Profitkoach - Business Growth Specialists
  • 26. Summary What we covered… The Entrepreneurial Seizure Why Do Businesses Fail? Avoid Becoming A Statistic Ways To Enter Business Profitkoach - Business Growth Specialists
  • 27. Resources PDF Of PowerPoint Presentation The E-Myth or The E Myth Revisited(Michael Gerber) www.business.gov.au Feel free to contact me brian@profitkoach.com.au www.profitkoach.com.au Profitkoach - Business Growth Specialists
  • 28. The Steps That Lead To Your Success! Financial Control – Financial management and reporting Aspiration – Defining your Vision, Goals & Objectives Strategy – The strategies required to meet your Vision Tactics – Low level activities bundled as a plan that implement your strategies Amplify – Extending your reach through leveraging other resources ReInvention – Planning your growth and development as an entrepreneur