Nov 22, 2008

Business Owners Do Not Work For Money

Marketing is not a job that you put in so many hours and get a paycheck or a salary and that is why people have difficulty marketing their business or product. Most people are approaching their business from an employee mentality.

Employees work so many hours and expect so many dollars for their work. Building a business is not going to pay you for hours worked like a job would. Building a business is an asset that will pay you long after the work is done. A true asset pays you even when you are not there or even if you are dead.

People coming from a job mentality have to learn to re-program themselves to think differently because if they are only interested in getting paid for their work, they should keep working or keep their job.

Take my friend Mary for instance. Mary has a business grooming dogs. She is well liked and has lots ofcustomers and referals. Her business is doing so well that she had to hire her neighbors daughter Beth to help her on weekends and some days after Beth is finished with school. Beth's friend Carla has even helped when they get busy and sometimes they walk the dogs for some extra money.

There's only one problem. Without Mary there to run things, the busines would stop running. She cannot take a vacation for fear of losing business. The last time she tried to go away some of her customers went somewhere else while she was gone and did not return. She feels trapped and her business looks more like a job then a business.

There's nothing wrong with her business except for the fact that she is an irremovable part of the business system and this is because from day one she approached her business like an employee would. It's not her fault really because like 97% of the population, that is all she has ever known. Her friend, family and business peers have only known how to be an employee and nothing in her entire life has ever prepared her to be anything else.

Building a business is not a job with a steady paycheck so the skills and mind-set needed to succeed are completely different than an employees. For example, hours worked have nothing to do with the profit made in a business and although many business owners work more hours on their business than most people, especially in the early stages of the business, the profit is not directly proportional to hours worked.

So just as there may be many hours worked with little profit at the start of a business, there can also be a lot of profit with very little hours worked as the business matures.

People who start businesses with an employee mind-set often take money out of the business like an employee would to pay for personal expenses instead of re-investing the money back into the business to fund its'growth. This is like starving your business and eventually it dies. 90% of businesses fail in the first five years of start up and of those that survive after five years another 90% fail in the following five years. That means that one out of a hundred businesses survive after ten years from start up and the main reason for this is that people are treating their business like it was their employer.

A business is a seperate entity and the ones that survive do not need the person who started the businessto be part of the business.

All businesses that survive beyond ten years have one thing in common regardless of what industry they are part of. They are businesses that have created a system that could be run by anyone. The owners created a system that does not require the owner to be part of the system. This means that anyone with the proper training could run the business and the owner can be somewhere else like on a beach or golfingor shopping around the world.

But if the owner of the business is only interested in taking money out of the business it will not live past ten years and nobody is going to stay there to run it unless there's something in it for them. So from the start, a business has to think about how to provide what everyone wants and needs in the most efficient manner and still pay everyone to work the business and still create enough profit to make it a worthy investment for its' investors. Not an easy task but if a business succeeds in doing so, it will be greatly rewarded and the owner should be able to go golfing while the business grows because it made peoples lives easier and created jobs for people.

Business owners who think about how to benefit everyone else before themselves are the ones who create businesses that survive even their founders. This is in stark contrast to the mind-set of an employee who is thinking about compensation for their labors. Building an asset that benefits everyone involved cannot be compensated by the hourand only passion and purpose can fuel and inspire someone to create such a business. Without a bigger purpose than a business will not survive and with a strong purpose and passion behind it, everything is acheiveable.


Frank Tocco--Marketing Mentor
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