How do you know when you have the right business? Richard Shrapnel, director of strategy and planning at Pitcher Partners, says there are no guarantees. He says the people running the business make the difference and while one business might be right for you, another could be wrong.
“If we look at Australia’s wealthiest people today, they have made their wealth by identifying, building and managing the ‘right’ business that has generated a strong cash flow,” he says.
You do need to keep in mind that every business is unique. Even if you look at McDonald’s stores, each one is different because it is managed and operated by different individuals. “It is that individual uniqueness which makes them more successful, or not so successful,” adds Shrapnel.
No business is guaranteed to be successful. It’s the people behind it who make it successful. “It’s the people who start it, grow it and continue to think about the business and continue to develop it.
“There’s always the need to ask the question, ‘Is this the right business for me?’ We want to grow our business. We want to make it bigger and more profitable. Building a business requires motivation, drive, commitment, passion and if it’s not the right business, those elements are just not going to be there and it’s not going to work for you,” he says.
Within the circle
To win in business you must understand your business intimately, in order to recognise an opportunity, search out and pursue it.
“Where do most people spend their time? It’s within a work environment. But then our business environment is exactly the same thing. Each of us has our very own circle and we spend our time within that circle. It’s made up of work, sport, hobbies, leisure, time with friends, and the things we enjoy doing. Our circle is a place that we understand and that’s where we are most likely to find a business opportunity once we turn our minds to it,” he says.
When on the hunt for that right business, keep in mind that to grow your business doesn’t mean you have to look for the next ‘great idea’. You don’t need to look for an idea that’s going to make you a millionaire overnight.
Knowing opportunity when it knocks
“Firstly, recognise that the opportunity is going to come from the circle in which you move. You may want to expand that circle or move that circle in certain ways, but you must know that’s where you are going to find your opportunity,” he says.
“You are going to have to begin to search within that circle. It can be frustrating and puzzling, but it must be an active search. Expect to see things come up where you’ll say, ‘I’ll try this’. There must be trial, error and experimentation, something you start with will evolve and grow.”
Successful business is about hard work and patience – 10 per cent inspiration and 90 per cent perspiration.
“Action balanced with planning is the way to go forward, not action controlled by planning. You’re never going to plan yourself into success and don’t expect to find the perfect plan that creates the ideal business,” says Shrapnel.
So, here’s the plan:
- List your opportunities.
- Find those that you think are right and begin to work on them.
Prudent financial management and risk recognition
The last thing you want to do in seeking your right business is to destroy your existing business. Be careful about that.
“To keep your existing business running smoothly there needs to be checks, balances and systems. Successful people know that there is a need to have suitable controls in place,” says Shrapnel.
A little bit of luck
Good luck is necessary for you to find the right business and to make it work. However, good luck seems to be attracted by people who are consistent, persistent and focused on hard work. As the old saying goes, ‘the harder I worked the luckier I got’.