10 Commandments for Business Owners
I once listened to Cosmas Maduka shared the story of how he started his business from N200. Yes, you read it well. The business – Coscharis Group – that he started with N200 some years ago is now worth multi-billion naira today. The subsidiaries of Coscharis Group include Coscharis Motors (the sole distributor of BMW and Landrover in West Africa), Coscharis Water, Coscharis Technologies (an authorized dealer for Compaq computers USA) and general air conditioners. You can read more about his story in Forbes Africa November 2015 edition.
Dr. Maduka’s story reinforces my belief that money/funding isn’t the major reason most businesses fail. One thing that struck me in his story has been his focus and tenacity. Despite the fact that he did not go to the traditional school, he has been able to build what many will term a successful business with operations in several African countries. If he could do it, you can do it.
Champions focus on where they are going to. The only man who never makes mistake is a man who never tries anything.
Thinking about his story again reminds me of a question that has been on my mind for weeks. How does one build a great company? How do you move from startup to a running a great business? Can one actually build a successful business with limited budget? Dr. Maduka highlighted some things that have helped him on the way. He called them 10 Commandments for Small and Medium Enterprises. So, if you own and manage a business at the moment or are thinking of starting one soon, read on. You can also bookmark this URL as these tips will come handy in your journey.
Even if you don’t have plans to start a business, you will find these tips very useful in your chosen career. The best gift you can give yourself after reading this is to make up your mind to apply every single tip or advice. Remember, whether you or your business will succeed or not depends on you.
Destiny is a matter of choice. It is something to achieve, not something to wait for.
- Pick and remain focused on a business you understand well: Don’t just go into a business because it is the most convenient business to start.
- Thoroughly understand your market: Don’t go into a business because you feel it is a nice thing to do. You must be sure that you understand your business environment. You need to be convinced that there is an existing market opportunity and especially that people will be willing to pay for your service or product. Never go into business because your friends are doing the same business. Even if it means you have to understudy someone for some time, you will be glad you did.
- Look for and hire professional managers: You might be the CEO, CFO, Sales Director, Chief Security Officer or Driver now but that will change soon. When it gets to the time to bring other people on-board, go for the best. Don’t hire someone because it will save you cost, rather bring someone on board because they will add value to your business.
- Put in place strong financial and administrative control: Whether you are in business or not, my advice is always simple: spend less than you earn and keep a money diary. If you are the CEO, place yourself on salary and make sure you don’t take more than the pre-determined amount every month.
- Constantly research the market to confirm the continue relevance of your service/products: Things change fast in every market. Have you noticed that most OEMs now release new version of their devices within six months of the last edition? This is exactly why you need to be on top of happenings in your industry and country. Many years ago, films used to be the main things when it comes to photography but that has changed now. People now carry around digital cameras and smartphones with powerful camera. So, there is no need for films again. If you were playing in the industry, you would be out of business now if you didn’t change with trends.
- Do not spend too much money on office space and self-serving activity: Break loose from I “have arrived” mentality. If you know you can’t afford an office space, continue to operate from your home. Many successful businesses operated like this for some years and most people can’t even remember this again. Also, don’t compete with your staff. The fact that you staff is driving a BMW doesn’t mean you should drive one too. If you can’t afford a car yet, don’t worry. Keep working on your business. Remember, your staff has certificates and can always get another job. But you have to keep the business moving since it is what you have decided to do.
- Have a business strategy plan and constantly review it: Always review your plan. Identify things that work out based on your plan. Pick the lesson and apply it again.
- Keep proper and complete record of all transactions: This is especially important in the areas of finance. If you just wake up from a sleep and you are asked about your financial transactions, you should be able to come up with this within few minutes.
- Make sure that there is a job description for every position and match with income-earned.
- Set performance milestones and standards against which progress can be measured: How do you determine if your business is on the right tracks if there are no performance measures? If you are in sales business, you need to have, for instance, an idea of how many sales you intend to make in a year. This can then be broken down into monthly targets.
This post first appeared as 10 Commandments for SMEs on BiTs.