Having invested 25 years into helping 3000 businesses and watched those businesses achieve in excess of $2 billion in additional income, I realise it is important to identify what they were not doing already and what I assisted them to do differently. Small to medium enterprises and start-ups often don’t have the resources and understanding that what it really takes to be successful in a start-up or small business is not to be taken lightly.

While there are eight key success factors every small business or start up should follow to reach its full potential, I’ll share the top four of them here. These are the first items every business should master to avoid becoming a business failure statistic.


Time management

Business owners, tradies and entrepreneurs are time-poor, working long hours with not enough quality time away from work. For a new business, work can be exciting enough to make you willing to put in 60-90 hours a week. If you haven’t gone broke in your first three years, as 50 per cent of start-ups do, then you may find working 75 hours a week wears a bit thin in your fourth year if you’re not making a substantial amount of money as legitimate compensation.

The solution is to learn what to do with your time each day as a business owner so that, as your business grows, you don’t become overwhelmed and less effective under stress. Done properly, you’ll be able to earn more while working less.


Leadership

Business owners are often frustrated and disillusioned by poor the quality and under-performance of employees, but don’t know how to improve this. Leadership is a critical skill for business founders to learn at the start, but even more critical as the business grows. Businesses that hit a glass ceiling tend to be run by leaders who have stopped learning. If you stop learning how to become a more effective leader, your business will stop growing soon.

The solution is to learn the power of building a high-performance team and how to attract and retain that team of first-class employees.

Cash flow

The single biggest issue that keeps entrepreneurs and business owners awake at night is cash flow. When you know you’re out of money, or close to being out, and are facing critical payments you cannot make, there’s no clear space in your head. You and your business have to wrap your minds around all things cash flow, so you can create cash buffers as early into your business lifestyle as possible.

The solution is to learn simple but highly effective cash-flow management techniques that will lead you slowly but steadily away from the edge of the cliff. This leads to an appreciation of why 92 per cent of businesses fail, and of what to do differently so that you don’t become another failure statistic.

Marketing

Many business owners don’t understand how to create an effective marketing plan, relying instead on their own energy, drive and sales ability to attract business the hard way. This means that the business is undervalued because of its sheer reliance on the founder, and it pushes the business owner into the “self-employed” category.

The solution is to learn how to target your ideal customer and ensure they’re willing to pay you what you want to charge for your products and services. Like everything in business, marketing is nothing more than a recipe that works. Understanding why less than 10 per cent of business owners have a solid marketing plan that delivers results is also helpful in knowing what to avoid in your own marketing endeavours.

When you launch your business, your objective is to build it up to a point where you can sustain your own salary. Once you’ve achieved that, it’s only logical to try to grow beyond this point and be able to afford other people work for you, day-to-day, to build a successful business. These four points are the stepping stones to reaching a level of sufficiency and independence in your business. To learn more about these points, and the other four necessities that make up the eight key success factors, you can attend one of our Master Builders workshops.



The Master Builders Association of Victoria, in conjunction with Best Practice, is now conducting business coaching workshops for members through to the end of 2015. Please visit our website at www.mbav.com.au or call on (03) 9411 4555 for information on how to participate.