Getting a business going is challenging. The more it is difficult if the habits of an entrepreneur are not placed under control. So, the first thing is for the entrepreneur to answer these questions. Some may be a wakeup call.
Answer these questions truthfully:
Does your spouse or partner complain that you spend too much money?
Are you surprised each month when your credit card bill arrives at how much more you charged than you thought you had?
Do you have more shoes and clothes in your closet than you could ever possibly wear?
Do you own every new gadget and feel proud of owning even though you have no immediate use?
Do you buy things you didn’t know you wanted until you saw them on display in a store?
Are you easily convinced by an advertisement about an item?
Do you purchase an item and rationalize if it is needed in the business without finding more details?
Do you see so much equipment or materials in your office and not used at all?
If a salesman comes around and tells you the price of a raw material is going to increase do you immediately buy more than what you need?
Do you get to feel you are spending more than you earn?
If you answered “yes” to any two of the above questions, you are an impulse spender and indulge yourself in retail therapy.
This is not a good sign. It will prevent you from saving for the important things like a house, a new car, a vacation or retirement. As an entrepreneur. Too, you may need to focus on placing your money on important areas to invest. You must set some financial goals and resist spending money on items that really don’t matter in the long run.
Impulse spending will not only put a strain on your finances but your relationships, as well. To overcome the problem, the first thing to do is learn to separate your needs from your wants.
Advertisers blitz us hawking their products at us 24/7. The trick is to give yourself a cooling-off period before you buy anything that you have not planned for.
When you go shopping, make a list and take only enough cash to pay for what you have planned to buy. Leave your credit cards at home.
If you see something you think you really need, give yourself two weeks to decide if it is really something you need or something you can easily do without. By following this simple solution, you will mend your financial fences and your relationships.
Here is another e-mail from a housewife whom I shall call as Mary.
I am not sure if you will reply to this e-mail. However, I need to seek somebody and request for an opinion.
I am currently employed as Human Resource Department Manager. My task is to ensure the welfare of our company’s 500 employees. Most of them are spread and based in key cities in the country. Thus, I cover too supervising the training and development of my assistants. This takes me to travel of an average 3 x a month for an average of 3 days per trip.
My husband is also employed and based in the Middle East. He works as an oil field engineer. He comes home every 6 months and spends around 15 days with us.
Lately we have been talking about our future. We normally do not take up such topics. I guess with our growing three children (the eldest now entering as freshman college and the youngest graduating in grade 7 this year), we are making some reality check.
My question is; Is it possible for me to invest on a franchise business and at the same time still be employed? I have been following your insights in this column. I know you too is family man.
Hear from you soon if you don’t mind?
Yes Mary I do respond to email messages within 24 hours. However if I do not reply it may mean I never received a message. This I often tell people.
Reading your letter, your task as HRD person is exciting and yet hectic. Supervising 500 people is a serious job indeed. Each and every individual has to be treated as a person rather than by mere employee identification number. But as you mentioned, you have assistants who handle the training and development. They are your key assets.
As a former OFW in the Middle East too, I know how it feels to be away from a family. You are fortunate because your husband has the privilege of going home every 6 months for 15 days. Most OFWs go home after their usual 2-year contract.
Your question of whether you can avail of a franchise business and at the same time still employed is possible. However, there will come a point after some time where you may have to choose which one. I have mentored several people like you. There was always a feeling of being secured in case the business venture falters. This is pretty natural. In Franchising or even start up, there is no guarantee of success.
Most franchisors though require a franchisee to be hands on. By this it means the person has to take charge of the day-to-day management. The essence of franchising is being in business for yourself but not by yourself.
The franchisor gives the necessary support including continuous training, product research and development, brand enhancement, etc. The franchisee on the other hand ensures the adherence to the set standards.
In your case, there are some franchisors who may be willing to do a management arrangement. There is an extra fee on top of the usual service and advertisement fees. The franchisor assigns on a temporary basis a management representative to oversee your store.
What I think is important Mary is to do the following:
Discuss in detail with your husband. This may cover doing a SWOT (Strength Weakness Opportunities and Threats). Be honest and say what you both feel. Remember you are investing for the future.
Involve your children too in the discussion. They will feel you are also listening to suggestions. After all this venture is for their future correct?
Do some short listing of possible franchise businesses you may like. In case you need my assistance, just shoot me an email. By the way, my book [i]“Is Franchising For You?”, may be of great help too.
Well just as I have share with others, it really helps to PRAY and listen to what God may be saying.
[i] “Is Franchising For You” is an award-winning book by the author which was published in 2012. It won the National Book Award- Professional Category.
Redesigning Your Marketing Strategy to Improve Your Sales
We all know that have of all startups don’t even survive for five years. And this is because of several factors, like: having insufficient funds, mismanagement, or the lack of knowledge and skills about the business. But if you are aiming to become successful, you must not let every opportunity just pass you by.
Not everyone could be as lucky in being able to put up their own business. There really is a huge risk each time. But then again, huge risk takers are more likely to succeed. Why? It is because they do not leave any rocks unturned in trying to making things better for their business. Once you have put up your business, your work does not stop there. It is actually just the first step of a very long journey which you need to go through.
What your business needs is more than just having the funds to put it up. There should be great planning on how to make the business work. It involves more than envisioning your long-term success. How can you even get there when you leave yourself stuck on the first step?
You need to figure out how you can make your business start smoothly and to put more time on certain things that needs you to focus on more. Here are some steps that can help you:
First and foremost, you must be able to sell yourself. Potential customers need to trust that you can be able to really provide the products/services that you are offering them. You are more likely to win your customer’s trust when you engage with them more.
You must be able to answer your customers when they ask you, “What makes you any different from all the others that provide the same services?” You should be confident to respond to your customers and be able to tell them what sets you apart from your competitors. With that you can take further steps on how you can make these customers to keep coming back to you. You should be able to figure out what special benefits that only you can provide and no one else.
Identify your target market. One way of helping you on what kind of business to put up is the thought of what are the needs of the people in a certain area. You cannot just put up any business without knowing if you can truly penetrate into the market. Example, you decided to have a 24/7 convenience store. The idea may be good because there are people who still might want to buy something when all the rest of the stores have closed, but the question is, “How big is the population where your business is located?” Will your business survive?
Over time, you will notice changes in the movement of your business. You should be able to identify which key points affect its growth then you should dedicate your time on those areas.
Think of how much more you can increase your sales by adding products or services. But be careful in choosing them. Not everything that seems to grab customer’s attention may really be profitable for you.
Check on how your competitors are going along with their business. Are they more successful than yours? If so, try to seek advice on how you can improve your business.
You may have focused so much in improving your weakness that you have failed to focus more on your strengths. If you have such strong points that you can use, where your business can benefit from, take advantage of it and focus in strengthening it. The confidence that it gives you can help you succeed.
Hire people that share the same vision as yours. You really don’t need to hire so many people to work for. Just choose those who are motivated and inspired with the company’s beliefs and aspirations. Pay them well and they will stick with you. Look for people who are after in establishing a career and not just wanting to have a job.
What works for one company may not work for you. It is because different companies face different challenges. Although steps were presented to you to help you make your business grow, still everything can change because of the changing market conditions.
The plan you have made should be able to help you in clearing out business efficiencies, refining its strengths that can better suit your clients/customers. Learn to tailor your business growth strategy instead of choosing a one-size-fits-all plan.
Your chosen business may be among so many others that has saturated one locality. So how do you make a difference? How can you make people choose you over your competitors?
Aim at providing a work environment that exceptional people can be part of. You think you are in a “who wants to be the next millionaire” kind of race. And while you want to succeed in your business, you can’t do that on your own without the help of hiring exceptional people to work with you. There may be so many people who may present themselves as the right people for your company. But don’t haste in choosing people. Choose wisely.
Adhering to standards, policies and practices of an industry can make you succeed in your business. However, you should also seek some other ways which you think may be beneficial to your business. Giving a little twist on certain practices may take time before you can realize that it can be effective. Thinking out of the box means changing perspective but focused on the same goal.
Businesses should focus on the value of their products. They should be able to prove to their customers that their products are better than their competitors.
Although your business seems to be in competition with others, your competitors should be your gauge on how you can improve your business even more. Always focus on how you can provide quality products/services to your customers.
The growth of any business depends on the attitude of the business owner. One needs to have an open mind and be able to willingly learn everything that can help with the business. Hiring the best people to work for the business and following a tailor-made strategy ensures growth of the business that can last generations.
When we start a business, we always hope that it will last a long time so that the next generations may be able to continue with the business – thus, leaving a legacy.
Let me tell you a story of a man who was married to a teacher and had two sons. He took up Agriculture in College. He started out with his small business of delivering different produce to provinces. Time came when he realized that he was too tired of travelling that he thought of starting a new business with the help of his wife. They have put up a lending business. They start with a small capital. But as years pass, their clients increased and so their business grew bigger. He was happy to realize that he did make the right choice of putting up that kind of business.
It was not easy at the start considering that both of them were graduates of a course far from the kind of business they have. He and his wife attended seminars in order to provide better service. They offer loan programs similar as those provided by financial institutions like pension loans, salary loans and business loans just to name a few. Twenty-five years and 19 branches later, they are considered as one of the top Credit Corporations in the country, the GA Alano & Sons Credit Corporation.
He died in 1996. Now the business is being run by his sons, his legacy continues. The success of this business is brought about by patience, perseverance and dedication which his children saw while they were growing up. Their employees remained loyal because they were happy with the kind of treatment that the couple showed them all these years. With those positive traits, even the grandchildren will be able to continue the family business. He was Gregorio Alano, Sr. He was able to establish the GA Lending Investors and the Katipunan Bank that both started in Dipolog City. Both businesses have various branches all over Mindanao and certain parts of Visayas.
I shared this story because it perfectly describes how a family business should be nurtured. No business can last long if the owners are not as dedicated as they should be. You should take care of the business because it is your family’s life that is at stake. Not all people are lucky to have enough funds to start with a new business. Once you have started one, value the time, money and effort that you have invested in it.
To thrive in any kind of business is to insist on continuous training and enhancement of skills. A business should meet the demands of the changing world. Part of any family business is the possibility of having conflicts as some may have interests on a certain position or there might be some question with regards on how the finances are handled. So many things can cause strain within the family. The best way to avoid these circumstances is, from the very start, everything should be clear on who does what and there should always be communication among them. Their attitude towards others may reflect the whole company’s image which may be the cause of the business’ sudden fall.
It has been reported that only about 30% of family businesses are able to pass it on to the second generation; 12% on to the third generation and only 3% on to the fourth generation.
According to FORBES, “…. it’s not enough to just put someone, or a group of people, in charge ….. the families that handle transitions well recognize that succession is a lifelong process and they often start thinking about the next generation early on.”
The family should start thinking about succession early on. When a business is passed on to the next generation at a young age, they are able to be properly guided and are given a clear set of perspective on how to properly run the business. If a young family member has been exposed to the business at early age, he is able to develop the skills necessary in running the business. And later on when the hat has been passed to him, he may be able to identify which ones will still work at the present time and if not, he can come up with better ideas to make improvements. A strong, corporate governance, policies and rules should be implemented that should hold strongly hold the company despite passing from one generation to the next. Steve Parnish, a business expert said,” “making a family business a family legacy takes planning and preparation.”
Some family-owned businesses have created a constitution stating clearly what the next generation’s role in the business as well as a vivid explanation about all the assets and how it should be divided among the heirs.
Gaining experience outside the family business may be helpful as well. This allows the company an opportunity to try other things that has been proven to be effective in other companies. Not necessarily trying to exactly replicate but the principles behind it may be of importance.
You may be focused on how the company should move forward. Apart from thinking of how to implement your new plans, consider the people that works for you as well. No business can ever last long if the people are neglected. The employees are the asset of any company. If they do not feel that they are being valued, they will leave and find for another company who can recognize their efforts.
Taking care of a family business entails a lot of hardships which conflicts among family members makes it worse. But the key to being successful in preserving the legacy of the family business is to build a strong foundation of love, trust and unity among the family members.
8 Important Questions Even Before Doing Business with Partners
Starting a business covers many aspects. Aside from the business concept and identifying the products/services, one thing, which lingers is having partners in the business.
Business ideas at times begin with a mere conversation among friends or family. One tiny spark may lead to having somebody pursue and see the prospects.
As a Business Mentor, I have seen entrepreneurs even discuss the idea using a napkin. There was even a time when one group had to pay for the table mantle as the exchange and flow were written.
Having partners may be a great idea to start with. Yet in my experience for the past 30 years, I was a witness to seeing the best of friends becoming best of enemies.
I thus have outlined questions for readers. They may not cover all but this is something to start. There are no right and wrong answers. It will depend on how comfortable each person may be.
Why do you really need a partner? Oftentimes I see people who cannot function of doing business without having other people around. Is it because of fear of failure or being surrounded with people who are serious and willing to put something at stake?
Do you really know who the partners are? The most blinding factor is seeing the money before knowing the people joining. I strongly say the other way around. It is not the money, which should be the main attraction. More important is the kind of contribution to the entire business each person can give.
Do you agree with the character traits of the partners? Beyond the money and contribution, the characteristic traits the partners have are the foundation of the partnership. Getting into business is fairly easy. Managing the business especially during the star-up stage may be something comparable to riding the toughest roller coaster. There are partners who never show up during project preparations. They are however ever present during launching or press conferences.
Have you considered the respective spouses? The spouses have a say in the entry of their respective partners in business. Knowing and understanding the character too is important.
Are the policies written, discussed, and understood? It is not sufficient to remain and agree on a verbal tone. As part of the compliance with Securities and Exchange Commission (SEC) there are set of rules to follow. However, go beyond these and arrive at an agreement to foster and sustain the partnership.
If any of the children of the partners apply, what are the procedures? This certainly happens in many companies. What you do not like to see is the immediate occupation of the son or daughter to a higher management post or has the title “COO” or “Child Of the Owner”. It may and surely create waves in the entire company. I have seen companies where a policy of this nature is covered. This is like having the child comply with the required qualification and experience. The child starts training at the bottom of the company. One amazing experience I witnessed was seeing the eldest son of a big corporation beginning his training as a delivery boy of the commissary. He had to pass each stage and no special privileges were afforded. This was under strict orders of the Managing Director.
If one of the partners wishes to sell out, what will happen? There will be times when any one of the partners may want to sell out. This may be due to some personal reasons. Nevertheless, what will be the steps be taken? Who may have the first option to buy and at what price?
If there is another business one of the partners wants to enter, does the company have the first choice? Opportunities are always around the corner and may be hovering way above. Partners may see some potential on a certain product. Can the company first have the first option to be offered?
In the end, if discussion among partners leave some questions unanswered, it is better to postpone and rethink. The business can wait than start it with a wrong footing.
MSMEs (Micro Small and Medium Enterprises) are considered the backbone of the Philippine Economy. Leaders of both government and private sectors admit the role of entrepreneurs play. According to an Asian Development Bank study, new and small firms generated 50 percent of innovations during the 20th century. Every Filipino has a gift of selling and dream of getting into business. In fact, if one were to make a survey there are micro businesses occurring in every office. There are employees who conduct side businesses like electronic loading of cellphone credits, buy and sell of clothes which may be paid in “gives” (installment plans). Others even extend credit or “paluwagan”.
In my 25 years in this profession, I admire those entrepreneurs who dare transcend to another level. They wanted to explore different possibilities. Thus, an entrepreneur can be somebody who is fearless, an out of the box thinker and open-minded. Remaining in their status quo is not in their vocabulary.
More and more young people are daring the older generation gets scared. I believe it is more of seizing opportunities and doing at the right time.
The growth of many businesses in the country can be attributed to the desire of an entrepreneur to expand and maximize the potential of the concept. It is a fact majority of businesses belong the MSME (Micro Small and Medium Enterprise). According to the Department of Trade and Industry the following are the classifications based on Asset:
Micro: Up to P3, 000,000
Small: P3, 000,001-P15, 000,000
Medium: P15, 000,001 – P100, 000,000
On Number of Employees
Micro: 1 – 9
Small: 10 — 99
Medium: 100 — 199
One sure way of achieving business independence is taking the Franchise route.
How did the word “franchise “come about? According to the Wikitionary.org it is from middle English franchisen, fraunchisen, from Old French franchir (stem franchiss-, “to set free”), from franc (“free”). From this definition, franchising is defined as being in business for yourself, BUT not by yourself. For an entrepreneur, there is this liberation of thinking how, where and when to build branches. There are other people called franchisees who with great interest, willingness to invest and manage the branches. On the other hand, the franchisees enjoy managing the business under the guidance of the franchisor.
The relationship of the two parties is and should be synergistic. There must be a win-win basis. However, there are areas, which need to be reinforced. First is the awareness and education level of franchising among entrepreneurs. Certainly, there is no doubt the brand is catapulted to greater heights and eventually the value of the business increases with expansion via franchising. Doing the right way of franchising a business begins with a proper mindset. If the motive of the person is to immediately fast track the franchise program for the purpose of getting the money of people interested, well I do not think such a business is worth getting into.
The other day I was talking with a young man who narrated how he and his wife felt betrayed by the franchisor. They both believed in the concept and potential of the business. They did sign up and invested somewhere to the tune of Php 3M. That money was hard earned and great portion came from both parents borrowed at “zero” interest or pay when able. What is sad is as the months passed by the couple felt the waning support of the franchisor as well the head office. Stocks were not consistent they were left to fend for themselves. Asked if they tried to meet the franchisor? The secretary of the franchisor just ran out of excuses to give! With a bitter pill, the couple had to swallow the fact nothing positive is happening. They even had to contact the other franchisees to ask if such problems have also been experienced. They were never given occasion to meet all together.
The couple cut further loses and threw in the towel. However, as the saying “when one door closes, the Almighty opens another”. True! Today their newfound business is on its 4th year with 6 strong branches and has carved a niche in the market. The couple shall soon be franchising. What happened to their former franchise? Unfortunately, the word “karma” has caught up with the owner. Only one branch remains standing.
Finally, here are my valuable tips especially now that many are planning of going into business:
1. Do conduct your business as it were a Mission of Goodwill.
2. Remember and apply the Golden Rule.
3. Impossible is always “It is Possible”.
4. If you believe in your business concept, pursue to a higher level
5. Expanding a business depends on the passion and confidence of Entrepreneur.
6. If you have a dream, pursue step by step; a business given the proper care grows.
7. Franchising is still the best route; tried and tested based on a prototype.
8. When one door closes, remember the Almighty opens another
Let me introduce myself. My name is Annabel a mother of three growing children. My eldest is 22 years old and just finished her studies in a known culinary school in Makati. The other two both boys are in high school. Being a single mother, I was able to make both ends meet.
Building a business takes time. This is so when the entrepreneur started this business from a dream. The first five years is almost always a roller coaster ride. Challenges after challenges come up and earth shaking situations may be tremendously felt. This is as if the entire purpose is to test if and when the entrepreneur may be easily uprooted.
Here are some reasons why entrepreneurs start a business?
1. Alternative to employment: Many always dream of having a business which may be a saving factor as compared to being employed. However to enter into business no matter how small but without proper orientation or guidance may be disastrous. Life time savings may be at stake.
2. Additional income from existing income: This is true some who may be employed would perhaps have a spouse enter into a business. It is more practical as both are still earning. There will come a time when the employed spouse may be facing a cross road. If and and when the business starts to grow, the employed spouse may have to give up and fully concentrate in further enhancing the business. Reality check: couples must be able to be comfortable in becoming entrepreneur couple. They have to identify the work areas each must focus.
3. Business Expansion: An entrepreneur after fully concentrating in the business may realize the need to further branch out. Staying in one area may not fully maximize its potential. The entrepreneur has to explore and learn the benefits of franchising. We all wonder how a certain brand has managed to grow into different places. We also read how brands which were unheard of suddenly we may see in foreign countries like the United States or Middle East?