In over a decade as a business development consultant, it still shocks me when I encounter a business owner who is reluctant to spend now for benefits that are not immediate and will be felt further down the time. Most of the time I attribute this to the fast-paced culture that requires immediate results, and this is especially evident at the top-level of football (soccer) management. In some cases these highly paid managers require huge payouts to buy them out of their current contracts, only to see them last in some cases, less than a month at their new job.
I believe in focusing on the long-term for many reasons, I don’t believe, and assume that most people feel this way too, that starting a business is something that is taken lightly. By starting a business you are planning for longevity, if not, stick to gambling, which is quick. In order to make your business successful in the long term, you need solid foundations. This doesn’t just apply for business but also for relationships and pretty much anything else.
The most crucial period of your business’ life is at the beginning. This is where most fail for a variety of reasons such as unbearable costs or lack of preparation. If from the beginning you are able to spend your funds wisely, this is the first step to ensuring its longevity. Preparation is crucial. If you begin with 5 employees, but only 3 are really needed and the others are sat around without anything to do, this is a waste of resources. The opportunity cost of hiring these 2 extra employees could be investment into more stock or marketing.
Technology has always been at the forefront of improving efficiency. From the development of electronic point-of-sale (EPOS) systems allowing transactions to occur more smoothly, to firms investing in meeting management software so they no longer have to manually organize meetings and book rooms, there is a world of potential options a business can take advantage of to become more efficient.
Efficiency develops over time. You cannot start a business already at optimum efficiency. It’s not realistic. From speaking to small business owners, many are under the assumption that investments in the business are too expensive, but I point out that the word ‘investment’ does not mean immediate results, but means to create wealth in the future. The later they decide to invest in certain things, the more expensive it could be, and they could find themselves perpetually saying investment is too expensive. This is the mindset I have come to realize mainly failed business owners possess.
If you really intend for your business to continue to grow and fulfill all its potential, I cannot stress enough how important it is to invest into this. Obviously, you must be careful with what you decide to put your money into, and think of the long-term benefits over the short-term pain.