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Welcome to another Strategy Thursday, where we discuss the most important fundamental business principles and strategies for success.
When you’re starting a new business, there’s a TON of advice out there.
Some of it dumb and irrelevant, such as “get a nice office, a nice letterhead, and nice business cards.” (Don’t laugh — I’ve heard worse advice!)
And some of it spot on.
There’s one particular piece of advice though that I’ve heard from two of my most respected “personal” business mentors.
These are two folks who’ve definitely been there, done that. Both of whom I’ve worked with personally in a limited capacity, and learned from tremendously through their own work and example.
And this advice — that each gave in their own words — is at the core of every business success.
And if a business fails, it’s because they don’t figure this out.
And so…
If you’re looking for the #1 most important rule of business success, THIS is it!
First, from Perry Marshall…
The world’s most-quoted Google AdWords expert… Direct marketer extraordinaire… The new champion of the 80/20 rule in business… Fellow Nebraskan (although he’s defected to Chicago)… And all-around cool dude…
I was reading a recent issue of his newsletter, where he broke down the most important rule for a new business as…
“Sell one product people like, at a profit.”
Stupidly simple, yes.
But don’t let that get you. This is profundity to the nth degree.
If your business is able to sell one product people like… Or a service, if that’s your thing… And do it at a profit… Well, you’re in business.
If your business has an office… And a logo… And a website… And a product idea (that nobody’s bought yet)… And patents… And ANYTHING ELSE that’s not sales… You’re NOT in business yet — you simply have an expensive hobby!
(There are a TON of startups that NEED this lesson, desperately!)
Further, if you fail at the second half of the equation, you’re also not going to have any REAL and lasting business success… A business that can’t turn a profit is a capital black hole. Sure, there are a bunch of Wall Street and Silicon Valley darlings that burn brightly while burning cash rapidly…
But ultimately they’re faced with this no-prisoners conundrum…
Profit, or die!
Yes, as you’re getting started in business, you may have to run in the red until you figure out your core selling strategy… Or until you build up the volume to cover fixed costs as well as the incremental cost of fulfilling the sale…
But if you’re not making profits, the clock is ticking my friend!
If you’re not making profits — and you can’t fix that — you WILL go out of business eventually. And possibly, with a lot of debt to show for it.
My other mentor, Mark Ford — writing under the name of Michael Masterson — put it another way… He said in his book Ready, Fire, Aim that the entrepreneur’s first question is…
“How can I make the first sale?”
His book should be required reading for anyone looking to start or grow a business…
He’s personally been behind the success of over two dozen million-dollar-plus companies… And two of those went to $100-million or more.
He goes through the three major stages of a business….
$0 to $1 million…
$1 million to $10 million…
And $10 million to $100 million…
(And then briefly discusses to a 4th stage that occurs at $100 million and beyond…)
We’re talking the first stage here though…
The key to successfully starting a business…
And with over two dozen businesses under his belt, here’s what he says…
“When you are starting a new business, selling must be your primary job.”
Your goal that will get your business from $0 to $1 million is figuring out how to sell one product or (scalable) service at a profit.
Do only what you need to do to survive in every other area.
But in selling, do everything you can to thrive.
As the business owner, when it comes to selling (face-to-face, through advertising, wherever), you have to adopt Harry Truman’s attitude of “The Buck Stops Here.”
Later, after you’ve established that you can sell your product at a profit, you expand…
You add products…
Chase new markets…
Implement business systems…
Upgrade your office space and letterhead…
And so on…
But you don’t have a business until you get this selling thing figured out. Period.
And that’s the secret to business success.
Yours for bigger breakthroughs,
Roy Furr
Editor, Breakthrough Marketing Secrets
