Up For the Fight?

So, here’s what happened.  Since January we had been living in a little flat with a big problem – there was a flaw in the plumbing installed when the building was remodelled which meant that sewer gases could rise through the pipes and escape freely into the bathroom.  It smelled like a public toilet all the time.

We talked about it with the owner who told us it was a construction mistake and couldn’t be rectified.  Every time I spoke to her I mentioned the fact the we weren’t happy and that the smell was sometimes so bad you would put off peeing as long as you could just to avoid going in there.  Once, when the landlord visited, we talked to some of the neighbours who had the same problem.  The couple upstairs who had two bathrooms even told us that they couldn’t use one of theirs (the one directly above ours) because it smelled so bad.

We had a minimum years contract, but told the owner at the beginning of April that we would have to leave because of the smell and would be out by the end of the month.  We went and found another flat and moved all our stuff out.

The end of the month was this week, so we went over there to give her the keys back and officially sign off.  I had trusted she would do the right thing, but my partner had had suspicions all week that she wouldn’t play ball.  She was right.  She refused to give us our deposit (1 months rent) back because we were breaking the contract early.

Now, we had always tried to behave reasonably towards the owner.  We had tried to solve the problems ourselves.  We had poured countless Euros worth of bleaches and chemicals down the tubes.  We had even called a plumber at our own expense.  In the end, when we couldn’t stand it any more, we gave her plenty of notice and told her she could bring people to see the flat whenever she wanted so she wouldn’t have the flat empty for any extended period of time.  When we gave the flat back, we left it cleaner than when we first took the keys.

Given the circumstances, I trusted she would see that we had behaved reasonably all along and would choose to do so herself.  Unfortunately, she obviously saw it as a chance to make some easy money from our horrible experience.  All she could say was: “Do you need me to read the contract to you?”.  She had also bought her beefy policeman dad as backup.  This is a person who knew about the smell, who had deliberately covered it up with air-fresheners the day we saw the flat and who had personally heard from the neighbours that their equivalent bathroom was unusable.

When we first met her, she seemed like a very pleasant and reasonable woman.  I wondered at what point her greed had overcome any natural human kindness instinct she might have had.  Yes, she did have the contract on her side – there was no clause that said “The bathroom will not stink”; there wasn’t even a ‘fit for use’ type clause.  So I guess if it went to court she’d probably win.  But really, is that the point?  Shouldn’t any reasonable person see that the contract means nothing if you can’t live in the place because it smells so bad?  That morally, not legally, she had no right to keep our money?  I asked her how she would be able to sleep at night.  The dad got aggressive.

When we came out of the meeting, both my partner and I were emotionally knackered.  We are non-confrontational types and recognised that the half hour intense argument had taken its toll on both of us.  We sat on a bench for a while and nursed our wounds.  When I got home I asked Google why we should feel so tired after a ‘fight’.  Apparently it’s something to do with hormones.

The whole episode got me thinking about whether these types of fight are actually worth it in the long run; and small business owners will recognise that when every day is a never ending fight with suppliers, customers, salesmen, con-artists and everyone else who wants a piece of your business, the battle can be exhausting.

The problem in the short term is the immediate desire for moral victory – “It’s not about the money, it’s the principal”.  You hear it all the time.  The problem is that when you’re up against an army of cold-hearted, empty-headed opponents, getting them to see the just truth is a very unlikely outcome.  And even if you do, as a non-confrontational person the victory might cost you more than the prize is worth.  So should you let people walk all over you, just for an easy life?  What’s the right action – fight or flight?

After running a small company for almost 4 years and taking a lot of crap and giving a lot back, I’m starting to think that either I don’t have the right personality for it, or that I’ve got the wrong approach.  When you sell stuff to the general public (and I’m sure all merchants will agree), there is always a small percentage of ‘bad customers’.  And I mean bad in every way.  The have a chip on their shoulder from the very beginning, demand discounts and special treatment, point out mistakes in your webpage or sales literature, behave irrationally and expect you to comply with their whims and then inevitably, ask for their money back.

In our business, problems are mostly delivery related.  Maybe 2-3% of deliveries go wrong.  People don’t take the time to read the information on the website, fail to receive their order and then expect us to bear the cost or responsibility.  When the customer is calm, genuine and reasonable, I never hesitate in helping them out, even making a loss on their order just so that they’re happy.  When the customer is an arsehole, it costs a lot more.  You’re left with a stark choice:

1)  Argue with the customer, exchange 6-10 heated emails, all of which leave you a little drained, get a chargeback on your PayPal or credit card merchant account, write letter(s) to them explaining the situation, exchange more emails and/or phone calls, worry, possibly progress to legal action, possibly win financially/morally, possibly not.  Or,

2)  Give the customer their money back.  Forget about it.  Move on.

What about suppliers who deliver late and mess up your whole logistics schedule?  Do you argue, complain, explain that their mistakes have cost you time and money, ask for compensation, risk ruining a stable relationship?  All of this takes time and emotional investment.  And it’s constant.

I know what my choice is.  But does that mean that I’m letting people walk all over me when I should be standing up and fighting my corner?  And I’m not just talking about customers – these situations arise constantly in business and come from all angles.  Fights with suppliers about pricing or delivery errors, with employees about behaviour, with customers about service and payment – business is a battleground, and my feeling is that the winners are the ones that are up for the fight, the ones who are prepared to not let anyone stand in their way, the ruthless ones, the ones who don’t care too much about other people outcomes or feelings.  Ultimately it’s survival of the fittest and a competition for resources and not everyone can win.

Me, I don’t want to fight so much.  So is the conclusion that I’m no good as a businessman?  Maybe.  No doubt that a more aggressive, less sensitive personality would serve me well in this particular domain.  But to be honest, I’m not that person and don’t want to be either.  I’m not prepared to force a change of personality just to get on in business.  Maybe I’ll learn to be more selective, to pick my fights better.  Maybe I’ll get naturally better at confrontation and negotiation.  Maybe I’ll find way to get others (professionals) to fight the bulk of my fights for me.  Maybe I’ll get comfortable with selectively letting people ‘get their way’ in pursuit of peace.  Maybe I’ll find a less conflictive business.

Maybe the hard edge of business is just for a different type of person though – and that’s a thought that troubles me.

Do you really have what it takes to start your own business?

Let’s be realistic for a minute.  Out of the hundreds of would-be-entrepreneurs who quit their day job each week, all but a tiny percentage will be back at the office doing 9-to-5 before a year’s out.  The statistics speak for themselves – something like 90% of all small business are gone within 12 months, out of those that remain, the second year failure rate is similar, and even then, out of the remaining group, the five year failure rate is comparable.

Why on earth do so many small businesses fail so quickly?  Are good business ideas really that hard to come by?  In fact, viable ideas are almost certainly nothing to with the problem.  Success, after all, is often in the implementation, and an average idea, bought to life by a a truly talented team, can trump even the most groundbreaking innovation where the realisation is weak.  The fact is that so many small business founders are just not honest with themselves about what it takes to successfully realise their dreams.  Making money from an idea is hard, but being truly brutal in your own self-assessment is even harder.  Really now, who wants to admit that they probably don’t have the numerical skills to understand pricing or cash flow?  Who could imagine their business failing because their marriage just couldn’t stand up to the strains of debt?  So the first instinct is to just jump in, thinking “I’ll deal with whatever problems arise later”.  Far better, surely, to be honest with yourself from the outset. Do you really have what it takes to start your own business?

This is my rundown of what I think are the key attributes needed if you really want to be a successful small business owner.  Of course, by ‘small business’, I’m referring to ‘Say No! to the Office’-type small businesses – modern, flexible, possibly location-independent, possibly little to zero startup capital, innovative business model etc.  For other types of business, not all of these may apply.  By ‘successful’, I’m talking about getting going and just surviving, not necessarily bringing home truckloads of cash within six months.  There’s a lot of luck in business, but luck favours the bold and, without a doubt, those that have the skills to bring luck onto their side.

Are you multitalented?  Are you smart enough to learn, literally, anything?

For me, and for the types of businesses I have been involved in, this is the number one.

Starting and running a small business demands a range of skills so vast and varied that you cannot possibly imagine what you are getting into until you’re into it.

Some might say that the only skill you really need is the ability to find, bring into your business, and manage people with the right abilities, rather than actually having any yourself.  Perhaps many even start out with that very idea.  For me though, that’s the approach of someone with a limited skillset and an even more limited ability to acquire new skills.  Your new idea isn’t a middle-management company, is it?  At the beginning, when money is limited, or worse still, non-existent, you’re probably not going to have the resources to find people to take care of every little task that’s outside your field of expertise.  Even if you do have access to that much cash, how can you expect to effectively monitor and guide what your team are doing without understanding it yourself?

The truth is, being multitalented by nature is a massive advantage in startup business.  Many people, either consciously or subconsciously, bracket themselves as ‘creative’, ‘numerical’, ‘artsy’, ‘non-technical’, ‘logical’, ‘scientific’, etc., and then put up barriers to anything which falls outside the definition of what they consider themselves to be.  Those are the people I have seen struggle or fail quickly.  Help is either slow or expensive – if you want real success, you’re going to have to depend on yourself, and if you don’t know how to do something at first, you’re going to have to learn.  Be honest with yourself – are you strongly right-brain, or left-brain dominant?  Do you struggle to acquire creative, or conversely, technical skills?  Or are you a polyglot, able to turn your hand to almost anything?  Test yourself – how do you feel about learning 80-100% of the following?

Business and Entrepreneurial

- Banking

- Book-Keeping and Accounting

- Small Business Technical and Legal

- Business Communications – Phone/Email/Fax

- IT Systems and Solutions for Business

- Market/Competitor Research

- Business Processes/Management/Productivity

- Logistics/Warehousing

- Personnel Management

Web Design

- HTML, CSS

- Javascript, PHP

- Web Graphics, Buttons, etc.

- SEO, Website Optimisation, Google, Yahoo, Sitemaps

- WordPress, Blogger, Ebay & Other Template Based Design

Graphic Design

- Photography, Photo Editing

- Logo and Brand Graphics Design

Software, Hardware and Programming

- System Set Up and Configuration

- Email/Web/Applications Configuration

- Microsoft Office Applications

- Adobe Photoshop, Indesign, Illustrator, Acrobat

- Javascript, PHP

Online Marketing

- Ebay, Amazon, Google, Shopping Portals

- Search Engine Optimisation (SEO)

- Adwords, Pay-per-Click Advertising

- Affiliate Programs

- Website Optimization, Promotions etc.

- RSS, Blogs, Feeds

- Social Networking, Facebook, Forums

- WordPress, Blogger, Feedburner

- Google Analytics

Offline marketing and Sales

- Leaflet, Flyer, Printed Material Design

- Catalogue Design

- Sales Agents

Writing

- Web Copy

- Proof Reading

- Product Description

- Press Releases, Articles, Reports, Blog Posts

And that’s probably only scratching the surface.  If you’re coming from a non-commercial background, chances are you’ll have almost none of the above knowledge to start with.  That’s OK, as long as you’re able to acquire it quickly.  The opportunities and resources for teaching yourself just about anything are virtually limitless these days – just hit Google or Youtube with the topic you need to learn about for an endless stream of information.  Think about how you have approached learning new skills in the past.  Have you been frightened off?  Or have you successfully applied your intelligence to new fields?

Luckily, most people will never be able to take advantage of this torrent of learning.  We are educated to be specialists, not generalists.  If you are truly multitalented, that works to your advantage.  Those are the barriers to entry that you will overcome and others will not.

Are you persistent? Will you survive ‘the dip’?

I’ve referred to ‘the dip’ before.  If you don’t know what I’m talking about, pick up a copy of the book and read it now.

It’s unlikely your business will work straight away.  In fact, it’s probably going to take a number of years before you really start seeing the fruit of your labour.  At some point into its growth and development, you’re going to hit a dip – a point in time where the initial motivation that kept you up all night designing logos is a fading, distant memory, yet the shining light of success, profit and perhaps even fame are so far in the distance that you can’t even imagine them yet, let alone see them.

Luckily, at this point most people quit.

Will you?  That’s what you need to establish before you even start.  Getting into the dip mindset is almost impossible – that’s why so many people start out blindly on a journey they were never, ever going to finish.  You can’t feel those feelings of despair and distress until you are up to your eyeballs in workload, bogged down in cashflow issues or debt, and facing one customer complaint after another.  That’s the nature of the beast.  You tell yourself that you’ll never be in that situation.  But you will.  You’ll tell yourself that even if you do get into that situation, you will be strong enough to pull through.  Be realistic.  Will you?  Most people don’t.  Getting through the dip takes more motivation, self-control and patience than most people can ever muster.  That’s another barrier to entry that stops the market getting flooded.  Not everyone is cut out for this.  So, you can fool yourself into thinking you’ve got the staying power – but wouldn’t it be better to consider whether you really do before wasting your time.  Look back at your past endeavours.  Have you done anything to suggest you won’t drop out at the first sign of trouble?  Have you achieved something that took extraordinary commitment in the face of strong pressure to quit?

The worst case scenario is that you waste a load of time, effort and money getting to the dip, only to quit when you get there.  Save yourself a lot of pain by only starting projects you are sure you can persist at, no matter what.

Are you patient?

Even if you don’t hit a strong dip, it may take a lot longer than you think to produce the kind of results you want.  If you plan for the business to be fully functional, perhaps even paying you a wage, within a year, what will you do if it takes two, three or even five years?

Even some of the best businesses, with outstanding implementation, still need time to find their niche in the marketplace, develop a strong customer base, and to gain the sort of momentum that propels them forward without the constant grind typically needed to push a startup along.  Perhaps yours is the type of business that gathers pace quickly, but in my experience, most startups are relatively slow-burners and thus their success is mainly limited by the owner’s patience.

When you find that your business is plodding along at a much slower pace than you expected, how will you react?  Are you impatient by nature?  Will you soon be looking for other avenues to explore rather than consolidating what you have?

Are you resilient?

I have never encountered the quantity and degree of obstacles, barriers and problems as I have whilst growing my small-business.  Sometimes I have felt like there was no solution, sometimes I have felt like I was banging my head against a brick wall and a lot of the time I have felt like throwing the towel in.

In the second year of trading with my food import company, we had outgrown the small storage unit from which we were trading and desperately needed more space.  We weren’t able to hold the levels of stock we needed to, which meant we were constantly letting customers down and more often than not, losing customers due to our inability to consistently provide what they needed.  We were, however, still small and not yet profitable, and really needed to find somewhere on a shoestring budget.  I have never encountered such a large obstacle to progress in my life.  We searched for months on end.  We almost quit.  When we finally found somewhere, it took 9 months to get the contracts sorted and move in.  It almost killed the business.  I can’t even begin to describe how close we were to losing it all.  But for some crazy reason we held on.

Business, for me, has often been like that.  I have encountered problems to which I had come to the conclusion that there was no solution, only to find that with time, luck and hard work, one does eventually come along.  At first, I was knocked back by each and every problem we encountered.  It seemed so impossible to progress.  It seemed what we were trying to do just couldn’t be done.  But as time has gone by, I have grown better at standing up to problems, at finding solutions, at being more resilient.

How resilient are you?  Do you have a defeatist personality?  Is the first, fifth, or hundredth problem or barrier likely to kill your business? Or can you turn a problem on its head, find a solution and move on?

Is your life flexible enough to adapt to your new business for an unpredictable length of time?

It’s not only your patience that’s going to be tested as your business takes time to grow and develop – your life, too, will feel the strain.  Relationships, kids, personal finances and social life are all likely to influence whether your business will succeed or flop.

It’s hard to imagine what a drain on your resources setting up a new business can be.  You are likely going to devote a huge portion of your available time, money, effort and love to your new project, and these are resources that won’t be available elsewhere and for others.

If there are others in your circle that depend on you – a partner, children, relations, friends – they are going to lose a large part of you for an unspecified period of time.  Do you think they can cope with that?  Or is it likely to cause tensions so strong that they threaten the development of the business?

Think practically – are your finances in a good state?  Can you afford to live for perhaps three years without a solid source of income?  Do you have another source of income?  Is your partner’s income large enough to support your family until the business is ready to pay its way.  You could bet on your business paying within a certain time frame, but what if that time comes and the business is not profitable yet, or not profitable enough.  Being forced by personal circumstances to leach money out of a business that is not yet ready to pay a salary is a sure recipe for cash flow trouble.

Personal circumstances can do more that put financial pressure on a budding business.  If both your life and business demand a greater amount of time than the sum total you have available, at least one, if not both, are going to suffer.  Make sure you are realistic about the personal resources you have available to devote to your project.  Don’t underestimate the investment that you are going to have to make, only to find six months down the line that your life doesn’t, in fact, permit you as much flexibility as you thought.

Stability and comfort is also a key factor.  I have seen friends really struggle with early stage businesses because of instability in their personal circumstances, such as:

- Unstable, volatile relationship with partner.

- Unstable finances.  No reliable source of income.  Constant unexpected expenses. No backup funds.

- Nowhere stable to live. Constantly moving from flat to flat.

- Nowhere comfortable to work.

- Insufficient physical resources.  E.g., no car, no computer.

None of these are limiting factors.  Of course you can start a business without a car.  But with all the difficulties you are likely to face anyway, wouldn’t it be easier if you could rely on yourself to get from meeting to meeting, rather than having to wait for the bus?  Of course you can start a business without a stable place to live and work.  But you’re going to be putting in mammoth work sessions at the beginning, and aren’t you going to be more comfortable and motivated to continue if you have a suitable, dedicated workspace?

As my own personal life has become more comfortable and stable throughout the development of my business, I have found it easier and easier to leverage my environment to produce better, more professional results.

 Do you have what it takes to start your own business?  Ask yourself the following questions and, above all, be realistic with yourself.  Wasting a load of resources and time on a project that’s never going to go anywhere is worse than not starting at all.

  • Do I posses a wide range of skills? Am I able to learn new skills relatively easily and quickly?
  • Am I a quitter? Do I have the staying power to work through the dip when times seem rough?
  • Do I have the patience to see the project through, even if it takes much longer than expected?
  • Do I have a strong, resilient personality? Enough to deal with the extreme difficulties business will throw at me?
  •  Can my life, my loved ones and my personal circumstances deal with the investment?