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How Businesses Fail. A Note to Entrepreneurs, Solopreneurs, and Consultants.

My good friend and all-around wonderful gentleman, Steve Woodruff, wrote an excellent piece over at Connection Agent. I commented there, but I couldn’t resist writing a little something here for non-salespeople.

I personally know many people who are very, very competent in their domains. They are true subject matter experts, and they have gained their experience working for great companies where they were able to produce stellar results. At some point, these people with great skills and expertise decide that they are entrepreneurs and hang up their shingle and attempt to go it alone.

And then they fail.

There is one primary reason they fail, and there is a single, simple (yet difficult) solution.

It Isn’t Technical Expertise

Many of the people I know who decide to go it alone and start their own business or consulting firm have plenty of knowledge. They also have the skills necessary to help their clients produce the improvements that they seek. The only problem is that they don’t have clients. This is why they struggle or fail.

Many people who go into business for themselves overlook how difficult it is to acquire clients. They mistakenly believe that their primary task in their new venture will be to utilize their technical expertise and their skills to help others. This isn’t their primary task. Delivering is the task that follows the acquisition of a client.

No client, no delivery necessary.

Businesses are built to acquire and serve clients and customers. Without clients and customers a business fails. Preventing failure requires a entrepreneurs undergo a fundamental mind shift—an embracing of the hard truth that their real role is sales and that their success depends on it.

The Remedy—A Devotion to Client Getting

Entrepreneurs and solopreneurs have to embrace that the remedy to their major business problem requires that they focus their efforts and energies towards client getting. For a business to survive and thrive, the business has to be devoted to acquiring clients.

If you are entrepreneur, you have to dedicate your time, your effort, and your energy to acquiring clients or hire someone who will. If you do it yourself, you are your own Vice President of Sales, Sales Manager, as well as your own sales force. If you hire someone, you are still the Vice President of Sales and Sales Manager; you have to lead and manage that effort.

If you are a solopreneur, you may not be able to afford to hire someone. This means that you are first and foremost your own sales force. The activities of selling have to dominate your agenda until you have enough customers and clients to sustain the business—as well as plan for continued client acquisition.

The amount of time, effort, and energy it takes to acquire clients is far, far greater than most entrepreneurs and solopreneurs imagine. And most of the other business challenges, like cash flow, are solved by client acquisition.

Without clients, businesses fail. Understanding and embracing that you are a sales organization first and foremost, is the key to your business surviving and thriving.

Questions

What factors contribute to a businesses failure? How many of those factors might be mitigated by better client acquisition?

When a small business, entrepreneur, solopreneur, or consultant struggles or fails, is it likely that it was their skills or technical expertise that caused their failure? What is normally the cause?

What is the fundamental reason for a business to exist?

How do you make the mind shift required to become the chief sales person for your business or practice?

 


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