A good take-off strategy, making calculated and informed decisions.

A good take-off strategy, making calculated and informed decisions.

I recently attended a seminar where the presenter described South Africa as one of the richest countries when the currency of its riches can be defined as its entrepreneurial spirit. This intrigued me to no end as the reasoning behind this was both interesting and thought-provoking. He went on to say that we have more entrepreneurs per capita than any other country in the world, whether this was based on research or simply a statement for effect I cannot say, but nevertheless it got me thinking.

Everyday in practice I consult with entrepreneurs from all age groups, racial backgrounds and economic status, one thing they all seem to have in common is a very strong urge to start a new business and succeed. Now this in itself will never be an indicator of success but given the statements made, by the seminar presenter mentioned in my opening paragraph, this seems to beg the question whether our entrepreneurial spirit has become so strong in Southern Africa that we tend to undermine the correct procedures and thought processes when starting off eventually ending in disaster.

With this in mind let’s look into what defines a good “take-off strategy” when starting your new business. First of all I firmly believe that calculated risk, especially in the early parts of this process, has its place in your initial thought process. Do your homework, do your research, take in as much as possible with specific reference to the industry you intend to enter. Having a good idea just doesn’t cut it anymore, in fact it only gets you 50% of the way. The remaining 50% comes down to hard work, dedication to your craft and your implementation strategy, in other words how will you take your idea to a declining economical market and make it successful. This opens a can of worms for extensive future debates that I am sure we will still engage on, but for now lets get back to the focus of this post.

Once you have calculated your risk, where do you go, how do you start, who do you trust, who do you partner with. These questions seem to haunt many a startup. The answer, not so easily defined, can be very broad or very specific depending on your needs. In general you need to keep in mind that your business idea is unique to you, nobody else knows the ins and outs of this better than you do, trust in your competence but don’t be blind to your flaws. I believe that failure to plan ahead in essence evolves to a state where you are planning to fail. Determine where your shortcomings are whether they are in the field of marketing, finances or both.

Let’s have a look at the four cornerstones of business:

  • finances
  • marketing
  • human resources
  • your specific product and/or service

For the sake of this argument we can assume that you have the latter part covered as the first part of being a successful entrepreneur is determining your craft, in this case either a product or service or both. With that box ticked, lets have a look at the remainder of the cornerstones. It is imperative that at this stage you need be honest with yourself, think of your experience in business, don’t be afraid to admit that you fall short in certain areas and do not be ashamed to ask for help in the areas you fall short in. For example, if you have no idea or experience in the field of marketing do not attempt to do this yourself, as chances are that you will most probably mess it up, get in touch with a reputable firm that can advise and guide you in the right direction or a mentor with extensive experience in the field you fall short in. The same principle applies to finances and human resources the last two being probably the highest risk for any business in our current economical environment. I will be tackling Finances and Human Resources as separate subjects in the weeks to come as they are too extensive to divulge in detail here, keep the principle in mind though as it will save you many sleepless nights.

It is critical to remember that in our current economical climate we have a bunch of role players in every industry competing for a slice of the same pie, with this in mind you need to remember that you get one bite of that slice to make your impact, if you miss out its done, if your first impression isn’t a strong and determined one your prospective clients will move on. Your reputation is everything and how your clients perceive your company and its representatives plays a huge part in this. Finding the balance between your corporate identity and how your business operates seems to be quite the challenge nowadays and this will most probably poke its ugly head out once you get going.

The theme of this post will inevitably lead to one simple concept, service delivery. Loyalty in the market place no longer exists and there seems to be a mood of acquiring “as much bang for my buck” as possible. Clients no longer stay loyal to a business based on past experiences or long extended bonds dating back generations, sure these are factors, but the only driving factor in the decision making process of your clients will be the here and now, how they experience you and your company at the present moment. It is human nature to forget the past if the present leaves you bitterly disappointed, and there will always be someone to take your place, whether or not they can do what you can do better than you can do it. Irrespective of whether you believe this or not you need to always be on top of things, find a management style that fits you, bearing in mind that leading by example tends to motivate clients and staff at the same time.

To bring this all together we can start assembling a basic business model, forgive me for the visual comparison to construction but I feel its very applicable to what I am trying to get across:

  • Lay your foundation correctly: Do your homework, do your research, determine your craft and calculate your risk. Strengths, weaknesses, opportunities and threats will always be a good start to any risk calculation method.
  • Cement your four cornerstones: Admit your shortcomings, ask for help and advice and most of all do not attempt to wear all the hats of your business. Focus on your idea, your craft and hone your skills. Choose your mentors and pick an advisory team that share your vision.
  • Place your first bricks: When you have completed the first two steps you should have a clear idea of how to approach the marketplace and your prospective clients, do this wisely and take your time, make informed decisions, trust your mentors and advisory teams. Remember one bite, that’s it, deliver your service, do it well and the rest will fall in place.

This will undoubtedly never be the only determining factors in the success of your startup, but in due course you will start developing a pretty good idea of the direction you are taking. I have applied this model to many of my own startups and I can, with great certainty, guarantee that it has yet to fail me. When applying these basics you tend to achieve a great platform to eventually take-off and soar. There are many a difficult path you are yet to face at this point, but at least you know that a good foundation can withstand great disaster.

Lastly I leave you with this piece of wisdom by one of my mentors: “We all have to start at the bottom, the decisions you make will determine where you eventually end up. Making wrong decisions or mistakes and learning from them is just as critical to this process as making the correct decisions from the start.”

Good luck and Cheers!

 

Introductory

Welcome to my blog that will take you on a journey of discussions and debates contributing to positive growth as we explore the realm of Small- and Medium Enterprises in the South African economy.

Sebenza Accountants have been around in one form or another for almost 30 years dating back to its origins in 1987. Its roots has always been firmly nestled in the ever growing, not yet big nor small, town of Bloemfontein situated in the heart of South Africa in the province of the Free State. From the start Sebenza Accountants has had a great focus on the Small and Medium Enterprise marketplace from professional entrepreneurs like Doctors and broader Business Professionals to Farmers and small to medium manufacturing and service industry role players.

I would formally like to introduce myself as I will be your companion on this journey of exploration and debate. My name is Rico de Villiers, a second generation Accountant and Entrepreneur. I was promoted to Junior Director holding the office of Chief Operations Officer of Sebenza Accountants during the early stages of 2015 as well as continuing my Accounting career as one of the Senior Accounting Managers of the same company. I studied B.Comm Financial Management at the University of the Free State before starting my career as a candidate accountant at Sebenza Accountants in 2009, I obtained my Tax Practitioner Certification at the South African Institute of Tax Professionals after passing the relative practical experience and board exams. Currently I am busy with a post-graduate qualification through UNISA in Advanced Taxation and I am also a registered student in the B.Comm LLB qualification through the same university. I will be finishing my post-graduate qualification in Advanced Taxation in the latter part of 2016 and my B.Comm LLB degree during the latter part of 2018 if all goes according to plan. I will be tackling my experiences and struggles in these areas on this blog as well so feel free to follow my daily excursions.

Enough about myself and the Company I represent. First and foremost I thank you for taking time to read this Introductory post and welcome any comments or discussions you would wish to engage in during this journey. I will be posting my direct E-Mail address as well as my LinkedIn profile link at the end of this post for your convenience.

I am still perplexed and easily confused by the correct way to end these “semi-formal” monologues so I will simply end by saying…

Cheers!

rico@sebenzacc.co.za

LinkedIn Profile – Rico de Villiers

Sebenza Logo