Success in Business will mean different things to different people. As a minimum Kostkas think you should be able to live comfortably and enjoy what you are doing. Our most successful clients really enjoy what they do. Being Happy appears a fundamental element to achieving Success.
We recommend every business should set goals. Business and a game of football have a lot in common. There should be fixed goal posts and lines on the field to mark your progress. And yes!! Even the best teams can expect to go backwards or be held up from time to time. The important thing is NOT to allow the goal posts to move during the game. A business plan developed by the owners is a great way to set & monitor those goals. 3 pages or 30 pages doesn’t matter as along as it gives clear & realistic goals. New Game New Goals.
Business success is more likely to be a marathon than a sprint. Businesses often get off to a good start and build to the owner’s capacity. What we find is the owners often struggle to build capacity beyond themselves and a few key employees. Working out a pace that is sustainable for you is most important. What is your personality? How important are Family & Friends to you? Are you building a business to sell or hold? Smaller well run businesses often give a better return to the owner than larger competitors.
Somewhere in your business plan consider having land & buildings. Bankers love property not businesses. Time and time again we see banks reluctant to lend to businesses that cannot provide security against land & buildings. That said, as a general rule we would not recommend the Land & Buildings be purchased in the trading entity.
Businesses have a life. Understand where your business is in its life cycle. Change is constant and the digital age is challenging many businesses. Retail and the infrastructure that supports traditional retailing is a very clear example of this. Adapt or exit – avoid the trap of doing nothing while a failing business consumes your wealth.
Risk is an inevitable part of Life and Business. Know how much adventure you and your business partners can handle. Identify and manage risk constantly from pre-start up and beyond the business closure.
Smart business people know what they don’t know and seek specialist advice. Knowing who is the right specialist for you; how much the specialist should cost and helping you understand and apply the specialist’s recommendations is something your trusted accountant should be able to help you with.
Developing and retaining multiple clients is fundamental to having a strong business. While some businesses are very restricted in who uses their goods & services wherever possible try to diversify your customer base. Being drawn to and being over reliant on a very limited number of clients can be a recipe for disaster.
Have an exit strategy and owners agreement. Most couples struggle to keep a relationship on track. The great advantage for a couple in business is that they have a commitment to each other beyond the business. If the only thing you have in common with your co-owners is the business you should consider the business as an arrangement subject to constant review and renewal. There are some fantastic partnerships out there but there are many failures. Partnership Agreements; Shareholder Agreements; Unit holder agreements can go a long way to avoiding protracted and expensive legal battles. At the heart of every agreement should be the requirement to obtain independent suitably qualified Mediation before Litigation.
We really like seeing our clients travelling. Most of us understand the importance bees play in pollinating many of the crops that sustain our human society. When business owners travel they become like Bees collecting the ideas/pollen that will drive the future productivity of their business. One great idea can make a huge difference.
The last but most important key to a successful business is an appreciation of what it is too work hard. Whether you are starting from scratch or taking over inherited wealth you need to be willing to work hard. Having a big brain alone will not make you successful in business.