1. A Guide to
Starting A
Sustainable
Business
Introduction
Short-Order Marketing (SOMA LLC) / Matthews, NC 20104 /704.542.9104
www.SOMALLC.com
www.LinkedIn.com/company/Short-Order-Marketing
Copyright 2011 4th Edition
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2. Introduction – FREE Download
What is a Sustainable business?
The Cube Business Model - The inter-related nature of the 4 parts of a business
How to find a business that’s right for you
Why should you invest in our startup course?
Our Goals for creating this series:
To provide people with an easy to use primer for starting a sustainable small business. Anyone in this
country who wants to own their own business has a right to do that. But, 9 out of 10 start-ups fail to
reach financial sustainability. The most common cause for a business failing is running out of what little
capital they had without acquiring enough customers to keep the business going. It’s not exactly
undercapitalization; it’s not acquiring enough customers. People spend too much time and energy racing
around in circles. Our personal experience tells us that what they need is a simple, practical plan that
will help them move from point A to B to C. This series is intended to be a guide for that plan. It is based
on our own successes and failures. It’s been tested and improved under fire.
Our primary Strategies:
Introduce the reader to the basic elements that make up a business.
Explain how these elements work together to create a functioning business.
Have reader apply this information to the task of organizing and launching their own business.
Help the reader achieve financial sustainability by providing access to continued mentoring support.
Series content:
Section 1 – Section 2 – Section 3 - Section 4 -
Finance People Operations Marketing
Basic Accounting – Sharing the WHY - Legal / Protection - Creating a Marketing
Every business owner Being able to clearly Legal aspects of forming System –
needs to know how to articulate why you are a business: Business Identifying the basic
read a Cash Flow / in business is critical to forms, agreements, strategies and tools you
Income /P&L enrolling anyone licenses. will need to launch your
Statement. What are touched by it. Building Insurances: Protecting business.
these things? What info relationships at many the business and
is included? What will it levels will make the job yourself.
help me do? easier.
Boot Strapping – Effective Leadership - Organization – How to sell yourself,
Where and how to find The ability to move Understanding and your products & ideas –
capital for your yourself and those using basic task analysis Writing, presenting, &
business. Working with touched by your & management tools to communicating is
other people’s money. business towards keep things on track. critical to moving from
Pay as you go strategy defined goals is what idea into action.
for start-up. will get you where you
want to be.
Build Financial Identifying important Creating a M.A.P. – New Media Basics –
ProForma - people – Where are you going Traditional marketing
A practical guide to Perspective customers, and how are you has been overcome by
goals and check points. Vendors, people of planning to get there? technology. There are
influence. new was to reach out.
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3. What is a Sustainable Business?
The majority of small businesses in operation across this country, and indeed around the globe,
are intended by the owners, to be “sustainable” businesses. These endeavors provide the
owners and their immediate families with an income equal to their financial needs. They don’t
take in more than they can use and don’t put out much more. They are sustainable in the
financial environment. That’s not to say that people who start their own businesses are not
ambitious. The dream of owning a “gold mine” capable of generating wealth is a part of almost
everyone’s dreams but, getting to a dependable and sustainable place should be a first priority.
Once stability has been achieved the business can be grow to the next level.
Small Businesses are human systems not organizational structures.
Because of their size, small businesses need to pool and share limited resources. Even more
important, they must hold and support a common vision and approach to delivering their
products and services to their selected markets. The people involved in a small business must
all pull together, in synergistic fashion, instead of claiming and defending turf.
People who are part of large corporations that operate under a traditional hierarchical
organizational model do not need to take into consideration the inter-related nature of the four
primary parts of a business - Marketing, Finance, Operations, and People. Their point of
reference is centered on the part of the business they have been hired to work in. To them, the
part of the business they are involved in is often viewed as the most important part of the
business. This perspective is referred to a “Silo-ing”.
The four parts encompass the basic functions of any business. Marketing includes all activities
involved in communicating what a company sells. This covers marketing planning, promotion,
communications, and sales. Finances included everything that has to do with managing money
– money coming in or money going out. Operations includes everything that has to do with
delivering products or services to the customer – production, physical plant, even the company
structure. Last is the People aspect of the business. Thousands of people are touched by any
one business. There are employees and their families as well as the owner and his family.
Customers, suppliers, vendors, bankers, shareholders and stakeholders are all touched by
businesses.
Once the owner and the people involved in running a small business, grasp the inter-related
nature of these four elements they can appreciate how any activity in one area has a direct
impact the other three. For example, good marketing puts greater demands on operations,
finance and the people involved in the business. Bad financial management inhibits the other
three elements by depriving them of the fuel (money) they need to keep going.
Small businesses are most successful when they are run from a team perspective. The game the
team plays is to have the customer feel good about doing business with the company. The
customer must be satisfied with the quality and cost of the products and services they
purchase. If the owner can learn to see his or her business this way and can instill this
perspective in all the people who become involved in the business it has a thousand-fold better
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4. chance of becoming successful. Remember: All the team members are involved in the same
game and any one of them can hit a home run.
So what does a small business look like if an org chart is not an accurate picture? After years of
working with small business owners we have come to use a cube as a visual representation of
what a small business looks like. The cube has four sides which represent the four functional
elements of a business: Marketing, Finance, Operations and People. The owner represents the
base of the cube, the foundation and source of the vision for the company.
This cube is capable of holding the energy, time, money and commitment that is invested in the
business. But like a real box the sides of the small business cube must meet and seal at the
corners or the things that get put into the cube can leak out and be wasted.
What gets put into the box?
Business owners will end up putting the most valuable things they have into the box like: Time /
Money / Energy / and Personal Commitment. If the elements of the box don’t form a tight bond
where they meet in the corners then they leak. Owners are confronted with a business that is
not retaining what’s being invested. If the skills needed in any one of the basic functional areas
are weak it will eventually begin to hamper the growth of the business.
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5. How to find a business that’s right for you.
The six issues that keep people from getting into business.
1. What can I do about Information Overload?
There is so much information available, from so many sources that the overload creates a
paralysis of the mind. “Who should I believe? / Who should I model after? / This group tell
me one thing –another tells me something different / The government groups tell me I have
to write a business plan but I don’t understand what the parts mean or what I should say or
where I can go to get this information.
A You need to follow life’s “Golden Rule” – Keep it simple (K.I.S.) I won’t add the derogator
reference because in today’s complex world things rarely look simple to anyone. But, simple
is the answer. Your most important issues are about defining your company’s VISION (WHY
it exists? / What problems are you set up to solve? / Who are you going in business to
help?) Then you need a basic Action Plan that addresses the four primary parts of your
business (Marketing / Finance / Operations /People)
2. How do I find the help I need around the things I don’t know how to do myself?
There are so many specialized skills needed to build a business. You are either a
technologist who knows how to do the work or you may be a marketing person who knows
how to sell the work, but you’re probably not both. Add to this the financial, legal and
operational controls you need to put into place and you have a real need to develop a team.
A Keep your team (and your business) as virtual as you can. There are literally thousands of
resources to work with locally or via the internet. They can be engaged on an as needed
basis and because they are part of the 17 million home-based businesses in operation in this
country they are often available for a low hourly cost.
3. Where can I get the money to get things started?
We hear this all the time. “I need $XXX dollars before I can even think of starting up the
business.” Most people don’t realize that the majority of micro- businesses are started for
between $5 – 10K in funding. If I was to offer you $100,000 in capital under the condition
that you had to give me $5,000 I’ll bet you could / would find that money someplace – even
if it comes a couple hundred here, a thousand there.
A You need to strip away any unnecessary outlays of cash not absolutely required. Then, re-
engineer processes to bring in cash as soon as possible. But, the most important thing you
must do is BE CONFIDENT in your vision, your plan, and yourself. An entrepreneur is not
afraid to extend himself or to take risks because he or she believes in what they are doing
and in why their target audience wants what they have to sell. You would have no problem
asking for that $5,000 if you believed that the $100,000 was readily available. Well, it is if
you believe it.
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6. 4. How do find the time to work on this right now?
It’s not unusual for people who have a regular day job to have a desire to start a business.
What is unusual is for them not to get caught up in a thousand and one excuses why they
can’t find the time to work on the activities needed to get the business going. “After I finish
working my regular job I need to take time to relax.” “I have a wife and kids that I have to
deal with.” “There’s a lot of stuff I need to take care of.”
A. Cut the crap. I’m sorry if I’m getting blunt, but if it’s not worth putting in the extra hours
then you really should just relax about working for others and learn to enjoy collecting a pay
check. There’s nothing wrong at all with recognizing that you’re not really interested or
committed to getting past whatever circumstances seem to be in your way. When
entrepreneurs say they spend 80 to 100 hours a week getting the business off the ground
they are not kidding. I’m typing this at 11pm on a Saturday night after taking some time to
relax and watch TV.
5. How do I overcome the paralysis that comes from the feeling that I might fail?
Thinking you might fail – the false belief that you might fail – as opposed to knowing you
will fail is a conversation many business owners have at some time or another. The problem
comes from a lack of self confidence in your idea and yourself. But, it also comes from the
knowledge that 99% of all successful entrepreneurs have experienced moderate to serious
problems including outright failure.
A The answer to this question is not an easy one. The knowledge that the majority of
entrepreneurs experience some level of failure is not an easy one to deal with until you’ve
experienced it for yourself. I have started and stopped a dozen ventures over the last 16
years. The primary reason for shutting them down was that they didn’t seem to be going
anywhere and I didn’t want to fail. I would shut them down before I got into real trouble.
My current business Short-Order Marketing has been built on the ashes of a prior failure
that took me through personal and business bankruptcy. I don’t recommend that anyone
should be flippant about bankruptcy but it isn’t as terrible as your mind can make it out to
be. It is a business/legal process that recognizes that some ideas don’t work out the way
you planned. I did not experience any rancor or harsh treatment. And, I learned a lot about
why it happened and what to avoid on the road back to building a sound business. The
great thing about the USA is we are big enough and wealthy enough as a nation to not
punish people for trying. If we did that we’d hamstring the great potential our
entrepreneurial efforts deliver to the country in the way of new jobs and innovation.
6. With all these issues and details to take care of where do I start?
A This is one of the most common questions I get asked by beginners. The simple answer is to
start with your VISION – What are you out to do? What problems are you out to solve? Who
has these problems and are they willing to pay to resolve them? Once you have a clear
handle on the answers to these three questions you have a starting point. The next question
is: What skills and knowledge do I have that will enable me to deliver on my promise to
solve these problems for my customers? Once you have the skills and passion identified get
busy letting your prospects know about what you have to offer. Test your action plan, refine
it and keep moving forward.
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7. Where do you look for business ideas?
Ideas can come from anyplace. The best ones come from recognizing an opportunity and a
need that is expressed by a defined group of consumers.
Services needed by others
There are thousands of business opportunities that reveal themselves to people every day, few
people recognize them. Often an opportunity is hidden inside a complaint. The established way
of doing things aren’t addressing the needs of select audiences. I once overheard several
neighborhood grocery store owners complaining that the produce distributors in town refused
to make short load deliveries. Someone with a van or small truck could provide delivery
services, catering just to these small retailers.
Entertainment
Providing entertainment for others has been a part of life since the Greeks formalized
wandering bands of players into the legitimate theater. If you have an interest in clowning it
could become an easy way to make a few dollars doing children’s parties and special events. I
once ran into a married couple that lived in a beautiful 28 ft. travel home. They made a fine
living doing shows and selling the hand-puppets they used. They traveled to state and local fairs
across the north-east in the summer and spent the winter in Key West performing and selling at
the flea-markets.
Marketing others products
From working out of a store-front to doing home parties there are many ways and kinds of
products, made by others, you can offer to eager customers. Convenience is the watch-word.
The huge growth of catalog sales and Internet shopping shows us that people don’t have time
to shop. The success of specialty stores illustrates the demand for “niche” products. I met some
folks who sold gourmet hot cocoa gift baskets out of a small kiosk in a busy mall. Not only did
they make a tidy living but also became a recognized wholesale / distributor because of their
purchase volume.
Repair services
When things break you can trash it, replace it, or fix it. As more people invest in higher quality
products it becomes less expensive to fix it than replace it and the need for repair services
grows. In the Chicago area a small company will come to your company’s parking lot and do an
oil change, tune-up, repair, or clean your car and fill the your gas tank while you’re working.
New inventions / Product improvements / New technologies
People who design and engineer new inventions are often not very interested in building a
business around the product. This provides an interesting opportunity to partner-up and bring a
new product to market. Sometimes older inventors will help a young business owner who has a
good plan and the drive and energy to make things happen; a win-win situation for everyone.
Extension of hobbies / Personal interests
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8. All types of people have had their hobbies turned into a business by customers that spread the
word and keep coming back for more. From fishing lures to hand-carved decoys, from clay to
gold the variety is endless. I recently saw a profile of an 80 year old woman that lives just off an
Arizona highway. She sells the thousands of hub caps she’s collected over the years.
Picking your customers.
You want to intimately understand your market: the problems they have and the language they
speak. The greater your level of understanding the more magnetic you will become. There are
two types of information you collect from and about prospects:
Demographics
Factual information that helps define a picture of your prime and secondary prospects. This
includes but is not restricted to: Age, Sex, Education, Type of work they do, Income, Where they
live, Family status.
Psychographics
Information about what motivates your prospect and defines their emotional and intellectual
self. This perspective will enable you to communicate in a way that gets your prospect's
attention and moves them into active participation with your message. This includes, but is not
restricted to: social attitude, self-image, need to feel accepted, sense of independence, the
sources of their frustrations with life.
–
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9. Determining if it's a sound business opportunity.
A Market in Need versus An Idea in Search of a Customer
All too often people will get an idea for a product or service that comes out of a personal
perspective, a kind of "what I think the world needs is..." This is not a very practical approach
to selecting a business that you expect to support you and possibly your family. As you survey
the economic horizon you need to tune-in to what others, large groups of others, are looking
for.
Selecting what it is you are going to offer is the second part of marketing basics. Too often
people decide to build their businesses on products or services taken from their personal
experience. The business is a reflection of what they personally see as "the need in the
marketplace". This places you in the position of being a service or having a product in search of
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10. a customer. Greater potential is found in first discovering what the marketplace needs and then
becoming a source for that product or service.
You are not in business for yourself - you are in business for your customer!
Once you have identified what the marketplace wants, the product or service you provide must
be the absolute best you are capable of producing or providing. No matter what you decide to
sell, there are always other sources or alternative products to yours. Building and maintaining a
superiority will give you a competitive edge you can trade on. This is critical to the success of
any business. Because of our limited resources, we must take greater care to be sure we
deliver, at the very least, exactly what we said we would.
Surveying the marketplace
By analyzing market segments you can:
Identify the specific needs and purchasing capabilities inherent within any group.
Collect information needed to make decisions related to long term market potential.
Find clues that will make your communication more relevant to the prospect.
Do-It-Yourself Research
Creating your own surveys is not difficult. The information is critical feedback, enabling you to
define and sharpen the focus of your marketing efforts.
Survey Prospects
Catch people entering or leaving businesses like the one you have or want to start. Give them a
questionnaire and include a self addressed stamped envelop.
Survey Customers
Find out what you're doing well and what you could improve in order to keep customers
coming back.
Methods:
Telephone survey -
Get name, address, phone number of customers into a database or onto index cards. Make
a few calls each evening or when things are quiet.
Suggestion Box-
Make it easy for your customer to let you know what they like and what they don't like. Be
sure to do something with the ideas or you risk turning off customers.
Anonymity -
People will speak their mind if they believe there won't be any way for them to get into
trouble.
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11. Why should you invest in purchasing this learning series?
As you work your way through this series you will be taking the first steps to joining that
fraternity of people that make this country what it is. Without small business there would be no
business.
Although corporate leaders and politicians like to give lip-service to the world of small business
most do not really have an understanding of what it’s about to own a small business because
the majority of them have never started, owned or even worked as an adult in a small business.
They live by the corporate and academic adage “Bigger is better”; an idea we find contradictory
to the laws of nature - take the dinosaur as your example. We firmly believe that the real
business survivor in the future will be the small business; companies that employ technology
for efficiency and keep personalized service and relationship building as their watchword.
Our businesses, Short-Order Marketing and SOMA llc, were created to become resources for
small-business owners everywhere. Our commitment is to share what we have learned from
the ups and downs we have experienced ourselves. We feel that people around the world
deserve to be able to financially take care of themselves and their families. No one should live
in fear of the “Bossman” and his pink slips.
The four parts of this series will provide you with a solid foundation upon which you can build a
sustainable business. The $149 you contribute to our business is a small investment when you
compare it to the over $150,000 - $200,000+ is cost us to learn what we’ve included in the
series. We will also include one hour of phone consulting and mentoring for each module –
four hours in total. This is a $200 value at our standard $50. per hour consulting charge.
Thank you for your interest and may all your dreams become your reality. If you have any
questions or comments please don’t hesitate to contact us via our email or LinkedIn account.
Steve Chapman
Steve@somallc.com
www.linkedIn.com/company/short-order-marketing
The BizCube illustration and the concept of the cube and a model for a small business are the property of Steven R.
Chapman, Short-Order Marketing and Somallc. The use of any part of this document without the express
permission of the owner and author is prohibited.
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