If you’re thinking about buying your dream business, it’s very easy to drift away on the novelty and excitement of the whole experience. So, if you’re not careful, there’s a chance you could end up faced with the cold reality of running a business without any clear idea of how you got there, or where you’re actually going.
The best advice is to reverse your thought process: Before you can know what business will be right for you, you need to be sure of what it is that you want to achieve.
Once you’ve decided that, you’ll be in a much better place to know what eventual success might look like, and whether or not it can be achieved, for example, by opening a restaurant. So here’s a checklist of things you need to work through:
It’s OK to have a dream. But you need to interact with all sorts of other people to realise that dream. Essentially, you’ll need to speak their language. That means being practical, knowing what you want to get done and having a plan to achieve it.
Your dream is unlikely to succeed if you’re only prepared to discuss it with fellow dreamers. So, if you want to set the right tone to convince others to believe in you, keep your business aims focused and attainable.
Think of the short and long term
Most business planning is better at addressing the launch of a business. Some plans even have a fairly realistic path to the break-even point where you hope to move into profit. But the weakest part of any business plan is often the link between short and longer term goals.
There is, or there should be, a clear connection between these two concepts: e.g. If we do this now, we should be able to achieve this in five years – and here’s the timeline showing the steps it will take. This will clarify your thinking and keep you on track during those times when it’s not so easy to think clearly.
How much money do you want to make?
Are you looking to just match your current take-home salary? Or do you have big plans to make far more? Whatever profits you may be looking for, you need to know they are realistically achievable within your business sector. And if the returns you are looking for are very high, that usually means you must be prepared to put in the personal effort required to pull in that amount of cash.
Rather than plucking a figure from the sky, it’s often more practical to set yourself a target – say managing to exceed your current monthly income by a margin of 25%. That’s easier to achieve than something further away, and when the time is right you can reset your goal to get to another new income level.
What do you want your day to day to look like?
Before launching into any kind of business, give some thought to how you want to be spending your business day. Will you be happy to commute over a long distance, or perhaps even relocate? You should also decide whether you are happy to work mostly in an office, or whether you maybe want to be involved in lots of business travel.
Entrepreneurs are also renowned for spending countless out-of-business hours to keep their business in the best possible shape. So are you happy to make the personal sacrifices this may entail to achieve your goals?
What type of work do you want to be doing?
When deciding your goals for the type of work you want, you should determine whether you prefer working indoors or out of doors. And in terms of working methods, would you want to use computers and other technology tools, or is the phone the best business tool for your method of operating? Other decisions about working options include more specific things such as whether your work might involve children or animals etc.
Quantifiable and specific goals
Smart business goals are always well-targeted and clearly defined. ‘Open five customer accounts in the West Country spending £1,000 per annum’ is far clearer than simply saying ‘We need more business’. That kind of focus harnesses energies and starts people thinking of outcomes rather than just straining hard but in a fairly aimless scatter-gun fashion.
All your business-oriented goals should be purposeful. Therefore most will concern economic outcomes which will advance your purely business aims, or personal outcomes which take you further towards your own lifestyle ambitions. And in addition, although retirement may seem a distant way off, it is nevertheless an important long-term goal which can only be properly realised through effective planning.
Defining your goals in advance will not only put you in a better place to decide what business to buy, it will also serve as an efficient tool to guide your efforts when managing your business. And once you have goals, you also have a way of measuring how much closer you are getting to achieving those dreams you had before your business journey began.
By Matthew Hernon is an Account Manager at Dynamis looking after Business Transfer Agents and Franchises across BusinessesForSale.com and FranchiseSales.com.