IN THIS ARTICLE (click to expand)
The script
Any business transaction, no matter the size or industry of the business, follows the same script:
A customer identifies a problem
They look for an answer or a solution
They find a business that provides them with their desired outcome
They give that business their money
It doesn’t matter whether the customer is a hungry 6-year-old in the tuckshop line or a C-Suite executive at Maersk trying to reduce operational overheads, the script is the same.
Sure, the stakes and complexity between steps 1 and 4 vary dramatically, but if your ideal customer approaches you and you can provide them with their desired outcome, they will give you money.
Before we cover the important details between the steps above throughout the rest of this series, here are four principles that will remain invaluable at every step of your business journey.
1) Solve your customer's problems
In the script above, did you notice that your product is never the focus? When you focus on what your customers need and how you can solve their problems, a few things happen:
You don’t waste money overdeveloping a product that no one wants or needs,
Your customers feel like you understand them (because you do) and that you can make their lives better (because you can),
You discover opportunities for growth and expansion.
What problem are you solving?
For example, Sally wants to get fit, but she is also a working mother of two on a tight budget. The outcome she is after isn’t a gym membership or a new set of kettlebells; she wants to feel good about her body and have more energy to be a better mom while remaining productive at work.
Understanding Sally’s problem reveals several opportunities:
She is busy and needs a solution that is accessible to her. What about a hyper-localised pop-up gym for busy mothers in your area?
Her desired outcome is feeling good about her body and having enough energy. Consider offering vitamin B boosters, or collaborating with an affirmation specialist who tailors their services to your clients’ needs.
She has a tight budget. What about offering low-cost (to you) items with your product for free or at a discounted rate to help her stretch her wellness budget and feel seen and appreciated?
What opportunities are hidden in your customer's problems?
Focusing on your customers’ problems, rather than just selling a product, helps you stay focused on what is important and opens up opportunities to offer tailored solutions.
2) Do the important, boring stuff every day
Being an entrepreneur can be thrilling. Securing your first sale, expanding for the first time, or reaching your turnover and profit goals are all worth celebrating. But that high can be misleading.
The Dunning-Kruger effect illustrates how a person’s confidence changes as they spend more time on a pursuit. It shows how our confidence grows rapidly before it hits a ceiling, often making us feel like experts too early. Over time, reality sets in, and we realise there’s more to learn.
As a new business owner, you will experience this curve repeatedly, to the point where you may want to give up. That’s where knowing what the important stuff is and doing it every day helps anchor you to the process.
Your success as an entrepreneur is not in the big moments. It is knowing what is important for you to succeed and doing that, day after day.
The definition of important stuff will evolve as your business grows, but here are a few broad areas that are worth regular, repetitive focus.
Financial tracking, review and planning
Are your budgets sensible for this phase of your business?
Are you leaking money to unnecessary overheads or product costs?
Are there any threats or opportunities you can prepare for?
Strategic planning
Is what you are doing now moving you towards your vision?
Is your product offering still aligned with your ideal market?
Is your business ready for growth, or prepared to handle setbacks?
Test, execute, optimise
Are you trying new things?
Are you evaluating what worked and what didn’t?
Are you consistently taking actions to stabilise or grow your business?
Customer communications
Can leads find you easily?
Do you know what your customers think of your offering?
Are they able to get rapid, quality support?
Are you building credibility by getting reviews?
Compliance
Does your industry have specific compliance standards that you need to adhere to?
Do you know what they are?
Do you have the team or processes in place to ensure those standards are met?
Optimise and simplify
Are there repetitive processes in your business you can automate ?
Can you simplify your business to better focus on what you do best?
Do you regularly maintain your critical business infrastructure?
This isn't an exhaustive list. These are just a few key points to get you thinking.
3) Don't trade trust for profit
As the adage goes, trust takes years to build and minutes to break. You will face many decisions that could make or save you a buck or two thousand but end up costing you even more.
There are two main things at play here.
Firstly, just do good business. Treat your customers and business partners with respect, deliver on your promises, and communicate as clearly and quickly as possible. Developing a reputation as someone who cuts corners, reneges on contracts, gives poor service, is impossible to contact or is a massive pain to work with will quietly sink your business before you realise it.
If a service provider you use immediately comes to mind as you read that, consider why. What is it about their service or product that is so bad? Are there any echoes of that in your business?
Word of mouth works both ways. Don’t provide reasons for people to warn against working with you.
Secondly, as you build your business you’ll develop a set of expectations around how you do business, your business values and the quality of your offering. We’ll cover branding in more detail later in the series, but what you need to know for now is that your brand is one of your most important assets.
As a young business, your brand will continually evolve and mature, but a quick way to break trust is to suddenly make a significant shift contrary to the expectations you’ve developed up to that point.
For example, if you’re known for high-end handbags, switching key components to a cheap quality supplier will decrease the quality of your products and people will notice.
Alternatively, if your brand has a strong connection to a specific demographic (women, conservative Christians, bikers, fitness fanatics) and you develop a product that opposes values held by that demographic because the market for that thing is hot, you risk alienating your core supporters and tanking your long-term scalability for a short-term profit.
4) Celebrate the wins and learn from the failures
Building a profitable business in South Africa is not an easy task, but thousands of successful business owners prove it isn’t an insurmountable one. Know that you will face failures, disappointments, second-guessing, criticism, debt and numerous other challenges common to all entrepreneurs.
But with that will also come the joy of making your first sale, reaching your first turnover goal, getting big enough to hire your first employee, and so many other moments worth celebrating. And you really should celebrate them — research describes how celebrating successes helps us cement what we learned, strengthen relationships and build confidence and connection.
Celebrating key moments gives you motivation in the present to carry on, and confirmation that you can do it when facing new challenges.
The other side of that coin is accepting that you will fail. You’ll make bad hires, employees and suppliers will mess up, customers will trash your name unfairly, you will miss opportunities or make poor business decisions, and sometimes you’ll just get really unlucky in a way you could never have anticipated.
The worst thing you can do with failure is ignore it. Every setback is an opportunity to learn. Instead of laying the blame on other people or circumstances, ask yourself the following:
Is this really a failure? If you are testing something and it doesn’t work, great! You should still follow the next steps, but now you have eliminated an option and refined a process, product or approach and created more clarity for yourself.
What happened? Go into detail to understand exactly where the faults started and what happened that caused the failure. Don’t judge, just describe.
What could I have done to prevent this? Short of getting hit by a meteor, there is always some point in the process where you could have taken steps to mitigate or prevent the failure. Was it a decision you made? A person you trusted? Money you should/shouldn’t have spent? Research you should have done?
Is this a recurring theme in my business? Hey, a blind spot! Everyone has them, but you’ll only see yours if you evaluate your failures (doubly so if you can get insight from an independent party). Are there any other points of failure that have similar causes? Are there any trends you can identify?
Are there any mechanisms or processes I can put in place to prevent this failure next time? Based on what you learned from questions 2 and 3, are there concrete ways you can avoid this failure happening again? Do you have an SOP? Do you need a more reliable review or QA process? Will a tech upgrade make a difference?
What else can I do better next time? It’s not about perfection, it’s about consistency. Failure can deter you from taking action next time, so while you’re still reviewing this one, identify what you’re going to do to get a better result next time.
Is there anything I should implement immediately? Some failures are useful case studies, while others require an immediate response to mitigate loss, especially if it is likely to compound. If this case is a latter, don’t delay taking action.
In closing
These four business keys will be relevant regardless of where you are in your journey, so we’ve designed A5 printouts which you can stick up on your wall (or use as bookmarks or coffee coasters or whatever else makes you happy). Click the button below to download the pack.
And with that, we’re ready to get into the good stuff.
See you next time.
The Concessus team
THE ROADMAP
Oh, you’re still here? Neat.
This section will be at the bottom of every article, in case you want to review something we’ve already covered or want to see what is coming up later.
How To Start A Business, From Concept To Cashflow (introduction)
The 4 Principles Every Entrepreneur Needs to Navigate Their Journey (You are here.)
Ideation: Finding and validating your business idea
Branding: Your most valuable asset
Business Planning: Crafting a solid business plan
Legal Foundations: Setting up your business structure
Staying Tax-Compliant in South Africa
Funding Your Startup: Navigating financing options
Cash Flow Management: Ensuring financial health
Product Development: From prototype to market
Marketing and Branding: Making your business known
Sales Strategies: Turning leads into customers
Building Your Team: Recruiting and managing talent
Scaling Your Business: Growth strategies
Navigating Challenges: Overcoming common obstacles
Sustainability and Social Responsibility: Building a future-proof business
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