How many times have you heard someone complain that they are unable to start a business, grow it and turn a profit because they do not have capital? No doubt that capital is an important part of successfully running a business. But contrary to what some might believe, many unsuccessful businesses and have their problems based less on the amount of capital the business has access to and more on the mindset of the business owner(s). Going into business with an employee mindset as opposed to a business mindset can break even the most capitalized of businesses.
The first path to having a successful business is based on one fundamental principle: businesses are set up to make money. Every action and decision that you as a business owner take must be informed by the return you will receive from the action. You might have heard the phrase ‘If you enjoy what you do, you will never have to work a day in your life’. It is true that enjoying what you do is always a plus in any business you do. But there must be a clear distinction that the end goal in setting up the business is to make a profit; having fun as you do so is an added benefit.
Another key component of a success mindset is collaborative but independent thinking. There is nothing wrong with asking for advice on certain aspects whether it is strategic advice from someone who has experience operating your kind of business or at an operational level from one of your employees. However, the key decisions that will determine the direction the business will take must ultimately be owned and rest with you. Even in the absence of such input from knowledgeable persons, you must understand your business well enough to be able to make key strategic decisions on your own.
A business mindset also means being open to ideas for generating income from multiple sources. Focusing on your core business is not a bad idea. However, and more so for small businesses, diversification might be the path to generating adequate income to shore up your core product during leaner times. In addition, you could land on a particular angle of business that might have such strong growth potential that you end up setting an entirely new company just for it.
Finally, a business mindset demands that one must be intimately familiar with the vital numbers that define their business. Trends in expenses, revenue, new products, overall employee headcount, individual strengths and weaknesses of key staff, market share and business forecasts. In addition, you must keep tabs of changes in the regulatory environment to ensure that you not only avoid falling foul of the law, but that you can also take advantage of opportunities that the new laws may present. Understanding the key parameters around your business does not require you to be an expert in accounting or law; having a success mindset only requires that you have a working knowledge of the information.