Dermot Williams: What I wish I’d known when I started
Published 27/07/2014 | 02:30
For Dermot Williams, managing director of Threatscape, focus, establishing customer needs, winning sales, hiring the right people and planning are key factors for success
First and foremost, focus on developing a profitable and sustainable business. It is great to go into a new venture with optimism and enthusiasm and ambition, but you need to be realistic.
I've seen projections and business plans where it is obvious that someone spent 80pc of their time on the 'income' side of the equation, finding ways to justify bumping up their forecasts of sales and profit margins, and convincing themselves they can achieve them - but only 20pc of the time thinking about costs and overheads and so leaving those numbers unrealistically low. Don't fool yourself.
Satisfy a need
I've seen business plans where an entrepreneur claims that there is "no competition" and they have a "first mover advantage". But to be successful, a product or service has to satisfy a need. So I ask a simple question: what does your target customer do now?
The answers are almost always "well, actually they….". That is competition. The ultimate, and in the end the only, validator of your business is the market. If people are not willing to pay for your product or service, you don't have a business.
Similarly, if when they do pay, you find you can't pay your expenses and make a profit, your business doesn't have a future.
The lifeblood of a business is revenue, and everyone throughout an organisation should be aligned to a common goal of generating sales. Those most directly responsible for sales need to employ equal amounts of energy and strategy, and to 'always be closing'. And after closing a sale, always ask for a referral. It's the cheapest and most effective way of finding your next big prospect.
A business which generates recurring revenue can quickly become self-sustaining. So nurture your customers once you get their first order. On the opposite side of the equation, recurring costs can strangle you.
Hire the best people
Hire the best and make them better still. Actively recruit people with skills that you don't have.
On the flip side, don't hire someone who will be a bad fit or disruptive to your team. It is better to have a hole in your team than an a**hole.
Don't be too busy
And finally, don't be a busy fool - so caught up in operating your business that you don't set aside any time to manage it. Make time out to review and plan.
(Thanks Dad for that vital tip back when I was starting out!).
Sunday Indo Business