I’ve always been business-minded, looking for solutions to problems, finding ways to improve things and thinking of ways people could do things better.
I have several family members with their own businesses and that probably influenced me growing up, because I’ve always wanted to run my own business, too. Working for other companies and helping them grow made me realise that this was something I could do for myself, so I set about trying to make that happen.
I was introduced to Nadine, who had 15 years of experience in the travel industry, and we launched eShores in 2007. Nadine and I worked from her spare room for 12 hours a day, seven days a week. Within four months we had built the business up enough to move into a small serviced office and take on two staff. That’s when we knew eShores had really begun!
We saw a gap in the market for a travel company that provided the ease of booking online with the level of service and support offered by high street agencies. We knew that if we were to go down the luxury route and provide high quality service throughout the whole holiday experience, we could create a business that was unique in the market at that time.
Once we’d seen considerable success with eShores we decided to try branching out by launching another website that offered cheap holidays that could be booked online. Quickly we found that marketing the second website was very expensive and difficult, because it didn’t offer anything different from other cheap holiday sites.
Trying to expand the business was a costly endeavour, but it made us realise that it’s not always best to branch out into a different area. If you have something that works, it’s better to focus all your time and effort in to making it the best it can be.
We don’t regret trying out the second business. It had an effect on eShores and took our focus away from the main core of our business, but this simply taught us a valuable lesson in keeping 100% focused on the main product, because this is what works best for us.
My advice to anyone starting out in business would be: choose the market that you want to aim towards and build it around that; and make sure you offer something different – you must stand out if you are to succeed.
Business partners Gavin Lapidus and Nadine Brown run eShores, which is now in its sixth year of trading.
Would you ever consider setting off on a long, unfamiliar journey without your SatNav or road map and only a dribble of fuel in your tank?
You might make good progress for a while, but before too long the roads will narrow, your fuel gauge will hit zero and your mobile will show no signal. HELP! Oh, if only you’d bothered to plan ahead!
Funnily enough, business planning is just like going on a journey. You know your destination, that fine place called Success. But knowing where you want to end up isn’t enough because you need to plan your route, too. And you must be vigilant, watch out for obstacles and steer clear of roadworks – not to mention bad weather and mile-long traffic jams.
If you’re serious about starting a business, you need to be serious about planning. You must focus on your ultimate goal – fabulous success – and determine your route towards it. This ranges from the grand plan right down to what might seem like insignificant details. If you plan for all eventualities – however small – you’ll know exactly how to deal with them when they, inevitably, crop up.
I took this approach in starting and running Diva Cosmetics and it quickly brought me success and wealth. Now, having moved on, I feel that passing on my knowledge called Seven Business Disciplines to budding entrepreneurs like you will bring you success. If strategic planning (my first discipline) is about visualising your destination, then business planning (discipline two) is how to plan your route to get there.
Let’s look at planning basics. What is a business plan? In a printed form, it’s a surprisingly slim document. Only 25 or 30 pages with a front cover carrying the business name and logo. Inside, the business idea is thoroughly investigated and includes supporting facts, figures and research. The writing style is easily readable within bite-sized paragraphs and technical jargon and waffle are banned. Titles and headings are concise with the overall structure being simple, focussed and well-organised and there are, of course, no errors (whether spellings, grammar or figures).
If the thought of sorting out your business planning sounds daunting, long-drawn out and too demanding of your scarce time, you should take comfort in the fact that this initial burst of effort will pay real dividends. This one document – and all the research that you’ll need to carry out for it – will help you decide whether or not the idea will fly. It will signal your chances of success and how to go about achieving it.
What are the key elements you need to include?
Once you’ve dealt with these elements you’ll be in a position to write an executive summary, a two-page summing up of your start-up. It should be convincing enough to excite potential investors, as well as boost your own confidence. Although this is written last, your summary should be at the front of the plan, where it needs to pack a powerfully persuasive punch.
When you’ve finished that first draft, you need to step away from the process. Return to it a couple of weeks later and read it several times. Make notes, gather more data and rework parts that don’t read well. Double check your facts, especially your figures, because they need to stack up and be impressive. Make sure the tone of the document shouts the right message. Does it ignite your passion? If not, revisit the words you’ve used and choose more dynamic, proactive, positive language.
Ask a business colleague, mentor or supporter to review it. This must be someone you trust, who has good judgement, knows you professionally and has an insight into your industry. Ask them to be honest and use their comments to hone what you’ve already done. After all that hard work, don’t allow it to languish on your desk. Instead, actively use your plan for reference, it will help you make good business decisions, take fewer risks and keep customers in the front of your mind.
At Diva Cosmetics, right from start-up, I updated my business plan regularly and used it to keep ahead of the competition. By focussing on the business, I was able to make decisions about staff requirements, how to expand the team and in what areas. I was able to review costs, check suppliers and understand the implications on the business should anything go wrong. I would undertake a full competitive review each year and adapt the marketing strategy on the basis of it.
My advice to you is to make your business plan a “living” document that evolves and adapts as you progress on your journey. Remember that planning is a necessity and if you want success you can’t afford to ignore it. So, I hope your journey into business is a smooth one – no collapsed drains or muddy old tractors up ahead for you – and do make sure you check your fuel gauge!
When you start and grow a business, you’re involved each day in the detail of running the business; perfecting customer service, ensuring positive cashflow, making new products and so on. This is all good and right but to plan for business growth, it’s important to step away from day-to-day affairs and take a good look at the business from a distance.
Years ago someone told me the story of a successful business owner who, once a year, would pack his bags, leave the family home, and head off to spend a week alone with the business plan. I’ve emulated this ever since and every year I think it’s time well spent. Freshly back from this year’s break, here are my five tips on how you can reap rewards from taking a business break.
1 Head to a place that stimulates the senses
This place doesn’t have to be far from home but it’s important you travel to it as the journey itself gives a sense of separation. As the car drives away/train pulls out/plane takes off, you positively feel yourself moving farther from the detail of the business and heading towards a space and place that will help you focus on ‘the bigger picture.’ Ideally, choose a place with dramatic scenery; open seas, rolling hills, tall skyscrapers; essentially you’re looking for a landscape that’s different to the one you’re used to as this will stimulate the imagination and create the perfect setting for planning.
2 Get settled
You’re in the setting and a new place, get yourself accustomed to it; take a walk, have a drink, allow your mind to wander and people watch! Feel yourself starting to relax? Good. You’re in the right frame of mind to start planning!
3 Ask yourself two questions
How has the business performed over the past six months/year and where do you want to take the business in the next six to 12 months. Write down your thoughts... on napkins... in a notebook... on your phone... whatever is closest to hand. Be ambitious in your goals and make the most of being in a place that’s encouraging you to plan for your dream business.
4 Don’t rush it
It’s likely you will come up with a new idea for the business in a ‘eureka’ moment of "Ah! Why didn’t I think of that before!" – allow time for this moment to come. You’ve certainly created the right conditions for innovation as your brain is finely tuned on the business and not distracted by detail.
5 And now for action
Possibly the most important point of all. Take your notes, head home, and get started on turning plans into reality!
Business breaks don’t have to be a full week or far away. What’s important is to place yourself in conducive surroundings. I do this alone, as did the man I emulate, but you may choose to go with a business partner or friend so you can vocalise your thoughts. Go with what works for you and know that taking time out may seem like an extravagance, but it will pay dividends.
After a very busy period planning for a major consumer show at the NEC and other important activities, I was looking forward to a few quieter days in the office, whilst Tony, my production guy come right hand, was fulfilling weekly orders and perfecting the new product to send samples of later on this week.
However... best laid plans. A large order arrived today marked URGENT and I need to drop what I’m doing yet again and come to the rescue.
My customers come first. But the stuff I need to do this week is strategic stuff, things that move the business forward. I’m torn and, quite frankly, I’m tired. If I don’t come to the rescue the orders won’t be complete in time and, if I do, then I have to work all hours to do the strategic stuff in the night. And to make matters worse, Tony in production told me ages ago that he needed two days off this week.
You may think that this is partly due to bad planning on the production side and that I should hold stock. However, our products are chilled, with no preservatives, and have a short shelf life (30 days from production), so I need to produce and ship quickly so the distributors and the shops get products with a decent shelf life.
It looks like I’m up until 2am again working for a few days! Oh well, I don’t mind, it’s a super exciting time and being stretched to fulfil orders is a nice problem to have. I just have to make sure I do the strategic stuff as well so that I am working on my business as well as in it!
You can find out more about Marcela on the new interactive business website www.inafishbowl.com
I am sure we have all driven in fog. Near me, there is a notorious black spot. It’s often foggy, and when it is, it’s like pea soup. As I carefully pick my way along, I’m usually passed by a few nutters doing more than 70mph. There’ve got no chance if they come across anything solid. It’s a way of playing probabilities that doesn’t appeal to me.
I know quite a lot of entrepreneurs that have started their own businesses. The successful ones always seem to have a deep knowledge of the key numbers for their business. As soon as you are talking business, they start telling you their figures. But this isn’t boring, geeky stuff. The numbers at their finger tips are the ones that show if the business is starting to work. They’re usually about the cost of getting new customers and how many were recruited last week. Then they explain how profitable it is, and whether more money should be poured in, or plans changed.
Starting a business is hard. You have to be both driven and confident to succeed. But confidence must be tempered with the reality that we all make mistakes. We need to measure things all the time. That way we can correct those mistakes and make adjustments as soon as possible.
Entrepreneurs that do everything by gut instinct are missing a trick. Like the maniac drivers in the fog, they feel invincible. But unlike most of the drivers, the majority of them won’t survive, at least in business terms.
In the latest installment of Marcela from Rico Mexican Kitchen's startup story, she employs her first member of staff and decides how best to distribute the everyday responsibilities.
Marcela was advised that her new employee would be extremely important to her business so she wanted to find someone she could trust and who could take on some of the responsibilities to allow her to concentrate on making Rico Mexican Kitchen a success. Having found that employee, can they find the right balance between friendship and work relationship?
With her new employee in place, they created a mind map to help them list all of the jobs that need to be done, who will be responsible for what and how they can support each other.
Do you have any advice for Marcela on her new employee and how having him around may affect her and the business? How can she ensure she is aware of what needs to be done at all times? How much input should she have in the work done by her employee now that they have split their responsibilities?
You can find out more about Marcela on the interactive business website www.inafishbowl.com
I love having my own business. I love the fact that I develop my own products and I meet people who are really good at their jobs who are generous with their advice and can help me with aspects I haven’t got specialist knowledge on - for example, testing my products in a lab for shelf life or designing a website. I love the opportunities, the dream that I can bring a new product to market and that people will love it.
I also like the feeling that I can contribute to helping improve other people’s lives through generating jobs and purchasing goods at fair prices, and be a positive role model to my children.
There is no denying that this keeps me busy. I sometimes have to be away from home a lot and work very long hours. Yesterday, my husband and I were stuck at the Belfast Airport as our flight back from our friends’ wedding was delayed. We set up camp on at comfy sofa in a coffee shop and started planning our next steps for 2010.
We talked business strategy, learning needs, project management tools and the fact that it looks like I’ll have to work away from home a lot. "Do you think the children feel that I am not around enough?" I asked him. Conflicting thoughts. I have heard them speaking about the fact that their mum is an entrepreneur and has a business and that I sometimes appear in the paper and on websites. But they are growing up really quickly and I say to them that although I may not be physically at home, they can contact me and I am always available to talk to them.
"Can you work really hard, be away from home sometimes and still be a good mum?", I ask my children. They both say “yes” and I sigh with relief. They tell me that they know that I care for them and that is, I think, the bottom line. I ask them what they are learning, if anything, about the fact that I have to put a lot of time into my work. “It’s a lot of time, but hopefully if I try really hard at something I really want to do, I can be successful” my daughter says, and I think this is a good lesson.
You can find out more about Marcela on the new interactive business website www.inafishbowl.com
Such a big part of growing a successful business is ensuring that you’re always thinking of new ideas or making improvements to your current business. But as many small business owners know, coming up with a great idea is easier said than done. If you’re someone who struggles with creativity or can’t easily prompt a brain wave, watch this show to get ideas from a brand which is growing rapidly and improving constantly.
A popular method of tracking and recording ideas is to write them down – or to “always have a notebook with you”. Tell us, when (and where) do your best ideas come to you?
Not a particularly cheery headline for a business startup blog, but it's an interesting observation which we can all learn from.
Richard Reed is co-founder of Innocent Drinks, a very successful business which brings fresh, tasty smoothies (and food products as it turns out) to a health conscious market in the UK, and now further afield. I interviewed Richard yesterday for yourBusinessChannel's latest series on business startups.
It was a refreshingly straight-forward interview. No business jargon. No pretence. No corporate positioning. I asked pretty straight-forward questions, and Richard gave pretty straight-forward answers. You see, one of the things that has clearly driven the success of Innocent Drinks is that they are honest and uncomplicated in the way that they talk about their business. They call it "innocent" language. And the language reflects their way of doing business - which is also said to be "innocent" in all respects.
Anyway, we spoke at some length about starting up a business, having great business ideas and such like. And during this refreshingly honest conversation, Richard said that when you have refined your entrepreneurial idea - the idea which will be the driving force behind your new startup business - be prepared for hundreds of people to tell you your idea isn't going to work. That's right. They're going to try to dissuade you.
Richard's advice? Be ready for people to try to shoot your idea down, but if you truly believe in it, don't listen to them. Keep going, and make your idea come to life.
Oh, and for anyone who feels a bit squeemish about Coke buying into Innocent, I asked Richard about that and got a very interesting reply, which we'll publish soon.
In the past few months we have witnessed a period of unprecedented economic turbulence and instability. In this blog I will describe some courses of action that may help to reduce the sense of helplessness businesses are currently experiencing.
1. Stay abreast of economic indicators
The global credit crunch and the increased uncertainty affect almost everyone. These are clearly very difficult times and potential solutions are occupying the minds of economists, bankers and ministers alike. Hence it is important to stay abreast of developments to ensure that management decisions are made in the context of the most up-to-date economic indicators and forecasts.
2. Revisit your business plan
It is perfectly acceptable to revise your business plan more frequently than once a year. If you have not done so for some time, it is worth revisiting it now. Business plans are written with certain assumptions built-in and these assumptions are context sensitive. If your business plan is over 6 months old, then it is likely that you will need to revise revenue figures downwards and costs upwards. Do this as soon as you can, and revisit key indicators such as current cash burn rates, debtor days etc. An up-to-date business plan can help ensure everyone is aligned towards the strategic goal of the company; ensure the cash flow is monitored and that the impact of changing assumptions is reflected in the numbers.
3. Review current projects and plans
Most businesses have a number of projects and initiatives on the go at any one time. These projects will consume resources over a number of months and years, and will typically involvement investment of time, people and money. The end goal of the completed project will often be designed to help your company generate additional revenue streams or to protect current streams. Again projects that have been planned over 6 months ago, and that take a number of months to complete should be reappraised. It may be more appropriate to defer projects or put them on hold until the economic conditions are more favourable or until the level of perceived risk and uncertainty declines. Any new contracts with third parties need to have additional safe guards built-in. For example, if exchange rates move outside certain agreed bands, it would trigger a renegotiation of the terms or an option to break the agreement etc
4. Communicate Effectively
It is not just management that feel the pinch when economic conditions deteriorate. It is likely some employees may be saddled with credit card debt, or may be sitting on properties with negative equity and may be worried about their futures. Management need to ensure their employees are aware of issues with implications for them. It is also important that employees are fully aware of the wider context so that any legitimate change initiatives designed to reduce costs are accepted rather than resisted.
5. Consider outsourcing some activities
In most industries it is possible to outsource non-core activities. There are many pro’s and con’s for outsourcing, however, if cash flows are under pressure, the inherent flexibility of outsourcing may be more appropriate until economic conditions improve.
6. Assess exposure to known risks and dependencies
In times of uncertainty it is important to step back and identify risks and to appraise key relationships. Is the company over-reliant on one particular company or industry? While this reliance may have been fine in periods of economic growth, it is important to recognise that a dependency on one supplier or customer dramatically increases the risk. Any vulnerability in one particular industry sector can lead to knock-on effects in the most unexpected of places (as well as in the more obvious areas). A diversification strategy can help to mitigate against an over-reliance on one supplier or customer.
7. Consider Scenarios
The importance of scenario planning grows when uncertainty increases. Scenario planning consists of management considering a range of plausible future outcomes ranging from a ‘small stretch of the imagination’ to the ‘outlandish’. The aim is to think through the implications for the company if certain scenarios came into effect. So for example what would happen if sales decline by 20% or if oil doubled in price in 2009? By thinking through a number of plausible scenarios, and designing strategies to deal with such eventualities, companies will be better prepared if indeed one of the scenarios does in fact occur.
8. Continue to Innovate
While it may be tempting to ‘tighten up’ it is important to recognise that increased uncertainty also brings opportunity. If competitive brands reduce marketing spend, it may be an opportunity for you to grow brand awareness. Similarly as companies advertise less, rate cards typically drop so it becomes cheaper to communicate with potential customers. Tougher conditions may force you to assess ways to reduce costs across your value chain or to innovate so as to reduce the cost of your product or services.
9. Don’t assume cost cutting is a panacea
Another common reaction to a downturn is to reduce costs through trimming wage bills by making employees redundant and cutting back on marketing activities. While reducing these costs may have a short-term effect on the P&L, they are not without their risks. Redundancies typically have a negative effect on the remaining employees that now feel less secure about their jobs, and are not happy with the extra burden placed on them with a reduced headcount performing the same activities. That said, downturns can legitimately be used to exit serial underperformers.
10. Keep an eye on the cash.
Given the ubiquitous impact of the credit crunch, it is likely that the cash positions of some customers will have deteriorated. If a majority of sales are on credit, it will be necessary to manage Invoices, and accounts receivables (debtors) to ensure that your cash position does not suffer also. Keep an eye to ensure your ‘debtor’s days’ figure does not creep up i.e. the amount of days on average it takes to get paid for a credit sale. A strong cash position is what you need to aim for.
The increased uncertainty in our environment means that planning for the future has become more difficult. However, it is how we deal with this extra risk will determine how our businesses fare over the coming months and years.