John Ingrisano here, sharing a few of the hard-and-fast rules I’ve learned about running a business over the last three decades. What follows isn’t brilliant…just true. Enjoy.
1. The purpose of a business is to make money. It’s fine to have a social conscience, but without a positive bottom line, you’ll soon be working for someone else…and your employees will be out of a job. So, don’t confuse charity with business. When you make money, everyone benefits.
In one of my misguided island ventures, I had a partner who thought the purpose of our retail shop on St. Thomas was to provide employment for her daughter and her daughter’s boyfriend. In the end, we went belly up for a number of reasons (including my choice of partner). The funny part (if losing $150,000 is funny) was that, while I went on to recover, everyone else was stunned and resentful when the doors closed and the paychecks stopped.
2. Ethical business is good business. Don’t cheat or lie to your customers, employers or suppliers. If you do, it will catch up to you eventually.
3. Hire only quality employees. Your employees are your greatest assets. Good, honest, hard-working employees will help make and keep your business a success. Poor employees will destroy everything you are working for.
4. Treat your employees right. This starts with paying them an above-average wage. In fact, forget about the "average" wage. If they’re good, pay them what they are worth. If they’re not, replace them.
5. Watch your top line and your bottom line. Delegate this responsibility and you delegate control of your business. Not really a numbers person? Tough. If you’re in business, at least learn the basics. Then, without fail or exception, spend at least 30 minutes each week poring over the books. It’s amazing what you can learn about your company that way.
6. Get good, objective advice. Your best source is your banker who, especially if you owe the bank money, has a vested interest in your financial solvency. The next best source is a good accountant (not just a bookkeeper, but an accountant) who can show you how to use your money to make more money and save taxes. Finally, talk to other successful business men and women. Do not talk to helpful friends and do-gooders who have never risked a nickel of their own money in a business venture. What they know can’t help you.
7. Establish a "brain trust." This builds on the above point. Find half a dozen aggressive, focused small business owners like yourself. Meet once a week for breakfast or lunch to discuss business issues. Form an agenda to discuss goals, concerns and "best practices," how to solve problems. Two hard and fast rules: (A) Discuss only business matters; do social hour some other time. (B) No griping or complaining; keep this a positive, problem-solving and idea-sharing session.
8. Maintain balance in your life, including time away from the shop. Business is important, but so are family and friends and community involvement. Workaholism is just another word for taking 60 hours what you should/must be able to do in 40. Go play.
9. Never forget that success hinges on SOP — standard operating procedures. Master what works and then turn it into a process that can be repeated over and over again. That’s the primary reason McDonalds has been successful. It can work for you, too.
10. Keep growing. Keep learning. Otherwise, you will become bored and grow stale, which is also the downside of SOP. The risk of creating standard operating procedures is that they eventually can become mind-numbing. Find new challenges.
Finally, be sure to work hard, have fun and make money.
The Freestyle Entrepreneur
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