22 {{ upvoteCount | shortNum }}
22 {{ upvoteCount | shortNum }}

Is your business set up to FAIL?

by Jason Kanigan
20 replies
Far too many of the business owners I talk with are set up so they have a 90%+ chance of FAILING!

Their limiting beliefs keep them held back so they have to perform so well, make so many sales, fulfill on so many orders that they're beaten before they start.

The really scary thing? They don't even know it. Plunging ahead, full of hope... and beaten before they began.

Maybe it's time for you to straighten out your business model. Consider a restaurant with incorrect food costing: they'll charge too low because of it and, even if they're popular, with every plate eagerly served they're selling themselves into oblivion.

On the opposite side of the problem, newbie internet marketers get into the business wanting to know "What's selling? What's hot?" This is not a magic cure for your problems! It's giving away your power to hope and random forces.

If you want to be a smart business owner, set things up so that you have a very high chance of SUCCESS! This takes decision.

Now of course that sounds obvious but are you doing it? Or are you "trying to make as much money as possible?" (a fool's errand--go get me some elbow grease and headlight fluid while you're at it).

How many sales do you need to make to hit your monthly revenue target?

Do you even HAVE a revenue target? Most people don't.

These decisions make a huge difference between steaming towards failure and not knowing it... and having a great chance to win before you've even started.

EDIT: I shared more info about what I mean... velocity or pacing, numbers... in post 7
#business #business model #fail #owner #set
Avatar of Unregistered
  • Profile picture of the author Jeffery
    Is your business set up to FAIL?

    A few are. I call them Loss Leaders.
    Signature
    In the minute it took me to write this post.. someone died of Covid 19. RIP.
    {{ DiscussionBoard.errors[11613776].message }}
  • Profile picture of the author Ben Scott Jr
    Great points Jason. Having false expectations. I agree 100%

    I noticed to many come into the game without having money to experiment in advertising and go broke before they even figure it out. They don't set a budget or expect to profit right away.

    It's important to do research but even after the research, you have still have to experiment.

    If you want to master Facebook advertising for example. Do your research as much as you can but then you still have to literally set a budget and not gamble your life away. Takes alot of patience to do this and does not happen overnight.

    It applies to every single aspect.
    {{ DiscussionBoard.errors[11614061].message }}
  • Profile picture of the author Claude Whitacre
    Originally Posted by Jason Kanigan View Post

    Maybe it's time for you to straighten out your business model. Consider a restaurant with incorrect food costing: they'll charge too low because of it and, even if they're popular, with every plate eagerly served they're selling themselves into oblivion.
    Let's take the restaurant example.

    Lots of people think of opening a restaurant. Why? They like being in a restaurant. The servers seem nice...so...viola!, they want to open a restaurant themselves to bathe in all that niceness.

    But;
    Have they ever owned a restaurant?
    Have they ever managed a successful restaurant?
    Have they worked in a restaurant?

    Have they even owned a business of any kind? had employees? made payroll? managed waste? managed employees?

    No.

    So, what brainstorm do they get? Borrow money. When...by the simple experience of working in a restaurant for 6 months...they would learn if they would even like being in the business at all.

    Every business imaginable has people in it that are killing it. Making huge sums of money, in any economy, in any location, because they are prepared. They know what they are doing going in.

    And all we have to do is work for them (or with them) for a few months to get everything we need to be successful when we hit the ground running.

    How do I know? That's what I did.

    I hope that helps someone.
    Signature
    One Call Closing book https://www.amazon.com/One-Call-Clos...=1527788418&sr

    “Do not seek to follow in the footsteps of the wise; seek what they sought.” - Matsuo Basho
    {{ DiscussionBoard.errors[11614064].message }}
    • Profile picture of the author kenmichaels
      Originally Posted by Claude Whitacre View Post


      Every business imaginable has people in it that are killing it. Making huge sums of money, in any economy, in any location, because they are prepared. They know what they are doing going in.

      And all we have to do is work for them (or with them) for a few months to get everything we need to be successful when we hit the ground running.

      How do I know? That's what I did.

      I hope that helps someone.
      Same here. I paid the piper for years with blood, sweat, and tears.

      It's hard to legitimately fail at something if you know where all booby traps are ahead of time.

      I say legit because life throws curve balls like disease and divorce and I'm not sure that a business failing due to those types of unforeseen issues count.
      Signature

      Selling Ain't for Sissies!
      {{ DiscussionBoard.errors[11614566].message }}
  • Profile picture of the author Jason Kanigan
    Yay, some engagement!

    So for IM part of what I'm talking about here is the * pace * at which you must accomplish things if you want to reach your money target.

    Let's take a pretty serious newbie to online marketing.

    Unlike most people, they have set their money target. Say this is $3000/month.

    But then they go out and become an affiliate for a product that pays out $10 per sale.

    The startling truth is that whether this product is popular or not does not matter. Simple division: 3000/10 = 300.

    THREE HUNDRED sales that poor fella needs to make from a dead start... ten a day!

    That is not gonna happen. Beaten before they begin.

    Crank it up to $50 commission. Still SIXTY sales... two per day.

    The poor newbie isn't going to be able to get enough traffic to generate two sales a day, either. Let's say it's miraculous and 1% converts. You still need 100 X 60 = SIX THOUSAND leads and that's at the bare "I SO lucked out" minimum.

    Line this up against the motivation, enthusiasm, stick-to-itiveness necessary to continue, and it's no wonder so many people give up.

    So what I recommend is setting up that pace of your business intelligently from the start.

    Step 1: Figure out your money target. HINT: whatever number you think it should be, double it. The number should make you gulp a bit.

    Step 2: Determine what is a truly reasonable and achievable sale value to reach that money target with.

    You will be pushed around by the usually unconscious limiting belief of what "a lot of money" is for you. So try to be aware of that and not let it kick you down the stairs.

    How much traffic can you expect to generate?

    How many sales can you really expect from that?

    Notice how these numbers can be arrived at independently of any product or service. Doing the reverse of this, jumping at "what's working? what's popular?", is where newbies make their biggest mistake... locking themselves into bad revenue equations like I talked about above.

    Once you determine how many sales you can really expect to make in the time period you're looking at, THEN you can go out and find or make a product that pays you that amount in commission or revenue.

    Don't let your mind checkmate you with a low answer to that "what's 'a lot of money' for me?" question. It will try. Keep the pace you need to work at in mind.

    Maybe you'll find the best way for YOU to proceed is that you only need to make one sale a month.

    Maybe it'll be one every week day Mon-Fri. What are you going to do to generate the traffic necessary to achieve those sales?

    This gives you focus real fast. You know what you have to be doing.

    Questions/Discussion?
    Signature
    >> How To Grow Your Online Business [FREE Training Video, No Opt-In, from 12+ Year Vet]

    >> For Agency Founders: The Fast Shortcut To Selling SEO, Leadgen, Webdesign & Other Services
    {{ DiscussionBoard.errors[11614065].message }}
    • Profile picture of the author Bkelly301
      Originally Posted by Jason Kanigan View Post

      Yay, some engagement!

      So for IM part of what I'm talking about here is the * pace * at which you must accomplish things if you want to reach your money target.

      Let's take a pretty serious newbie to online marketing.

      Unlike most people, they have set their money target. Say this is $3000/month.

      But then they go out and become an affiliate for a product that pays out $10 per sale.

      The startling truth is that whether this product is popular or not does not matter. Simple division: 3000/10 = 300.

      THREE HUNDRED sales that poor fella needs to make from a dead start... ten a day!

      That is not gonna happen. Beaten before they begin.

      Crank it up to $50 commission. Still SIXTY sales... two per day.

      The poor newbie isn't going to be able to get enough traffic to generate two sales a day, either. Let's say it's miraculous and 1% converts. You still need 100 X 60 = SIX THOUSAND leads and that's at the bare "I SO lucked out" minimum.

      Line this up against the motivation, enthusiasm, stick-to-itiveness necessary to continue, and it's no wonder so many people give up.

      So what I recommend is setting up that pace of your business intelligently from the start.

      Step 1: Figure out your money target. HINT: whatever number you think it should be, double it. The number should make you gulp a bit.

      Step 2: Determine what is a truly reasonable and achievable sale value to reach that money target with.

      You will be pushed around by the usually unconscious limiting belief of what "a lot of money" is for you. So try to be aware of that and not let it kick you down the stairs.

      How much traffic can you expect to generate?

      How many sales can you really expect from that?

      Notice how these numbers can be arrived at independently of any product or service. Doing the reverse of this, jumping at "what's working? what's popular?", is where newbies make their biggest mistake... locking themselves into bad revenue equations like I talked about above.

      Once you determine how many sales you can really expect to make in the time period you're looking at, THEN you can go out and find or make a product that pays you that amount in commission or revenue.

      Don't let your mind checkmate you with a low answer to that "what's 'a lot of money' for me?" question. It will try. Keep the pace you need to work at in mind.

      Maybe you'll find the best way for YOU to proceed is that you only need to make one sale a month.

      Maybe it'll be one every week day Mon-Fri. What are you going to do to generate the traffic necessary to achieve those sales?

      This gives you focus real fast. You know what you have to be doing.

      Questions/Discussion?
      Nice post!

      This sounds very similar to me when I started. I had the $3K/month goal myself. I had no real plan, so I just started cranking out a ton of content based on what I was good at.

      I eventually decided to make a "product" and sell it for $47, and to my surprise I made a sale within the first 48 hours of adding it to my website. I also made another $9 eBook out of some of the stuff that I used to make the $47 product.

      Time went on, and I kept adding value to this product and making more sales as a result. I wasn't really prioritizing the email list, but I was still collecting emails of the buyers and I had an email signup form on my site.

      More time went on, and I eventually decided to sell both products together for a total of $59. I still kept making sales...At this point I was making around $1000 per month give or take.

      Fast forward a couple years of this, I found out that I'd be having a kid and it was time to s*** or get of the pot, so I took out $5000 which was half of my total savings, and I paid a coach for 30 days of 1 on 1 coaching. Through his guidance and the massive action that I took, I shortly reached the point where I was clearing $3000/month pretty regularly.

      Fast forward to today (about 4.5 years into this)... I've had a few months where I cleared $10K. However, that is not a regular thing. I average about $5000/month these days, and I'm trying to get to the point where I am doing $10K/month consistently. I'm doing this by focusing on building a better relationship with my email list and creating more products.

      I anticipate that I will be at the $10K/month point within the next 6 to 12 months.

      I almost gave up on all of this many times. The only thing that I knew is that I had to keep going. If I quit, then I would never achieve the goal...so I forced myself to keep going, even though I really had low expectations of it working.

      Well good thing I stuck with it, because this is now my full-time job. This is what I do for a living. I have a family and bills to pay, all of which I pay for with a job that I created for myself.

      It's pretty cool what's possible if you just stick with it!!
      {{ DiscussionBoard.errors[11614100].message }}
    • Profile picture of the author TobiMDD
      Originally Posted by Jason Kanigan View Post

      Yay, some engagement!

      So for IM part of what I'm talking about here is the * pace * at which you must accomplish things if you want to reach your money target.

      Let's take a pretty serious newbie to online marketing.

      Unlike most people, they have set their money target. Say this is $3000/month.

      But then they go out and become an affiliate for a product that pays out $10 per sale.

      The startling truth is that whether this product is popular or not does not matter. Simple division: 3000/10 = 300.

      THREE HUNDRED sales that poor fella needs to make from a dead start... ten a day!

      That is not gonna happen. Beaten before they begin.

      Crank it up to $50 commission. Still SIXTY sales... two per day.

      The poor newbie isn't going to be able to get enough traffic to generate two sales a day, either. Let's say it's miraculous and 1% converts. You still need 100 X 60 = SIX THOUSAND leads and that's at the bare "I SO lucked out" minimum.
      [...]

      I agree, one of the biggest mistakes to promote these low priced products as a newbie especially when they don't have a huge sales funnel..


      Originally Posted by Bkelly301 View Post

      [...]
      Well good thing I stuck with it, because this is now my full-time job. This is what I do for a living. I have a family and bills to pay, all of which I pay for with a job that I created for myself.

      It's pretty cool what's possible if you just stick with it!!

      Awesome story, you can be proud. It's so important in this business model to have the right mindset and to never give up.
      Signature
      {{ DiscussionBoard.errors[11614296].message }}
  • Profile picture of the author Princess Balestra
    Seems my Bunny Ear Re-angler franchise is mebbe a non-startah.

    Yanno ... if'n you an Insta inflooencah, you gotta be sure them cutesy bunny images are right an' stuff?

    To perfectly sync with your brand?

    Name I got was


    BEND MY EAR

    Tagline I had was

    There's No Crappin'
    With The Perfect Lapin

    but my promo guys ran the presentation from home an' accidentally revealed a whole buncha stuff mebbe they shouldna.

    Hey, but I still figure there is a place in tne market for expertly manipulated wrenches in the bunny ear department, if only so's they don't fall by the wayside bcs LOLcats.

    Ain't figured my policy on hares or marmosets, but I mostly straight on the key ishoos.
    Signature

    Lightin' fuses is for blowin' stuff togethah.

    {{ DiscussionBoard.errors[11614092].message }}
  • Profile picture of the author Profit Traveler
    Banned
    Great post.

    Even if I had a huge business I considered a well oiled money machine I would hire Jay Abraham to get in there and poke around.

    That guy can find un-used or under-used assets small tweaks that can add tremendously to a bottom line.
    {{ DiscussionBoard.errors[11614311].message }}
    • Profile picture of the author Jeffery
      Originally Posted by Profit Traveler View Post

      Great post.

      Even if I had a huge business I considered a well oiled money machine I would hire Jay Abraham to get in there and poke around.

      That guy can find un-used or under-used assets small tweaks that can add tremendously to a bottom line.
      That is something you have read. You can't say that unless you actually hired someone and they actually did it.
      Signature
      In the minute it took me to write this post.. someone died of Covid 19. RIP.
      {{ DiscussionBoard.errors[11614315].message }}
  • Profile picture of the author Medon
    I beg to differ, people don't open a business anticipating failure! In fact, majority of entrepreneurs start a business after identifying a gap that needs to be filled.Say for Instance you get employed by a fuel station, you work with them for a year and get pissed because of the mistakes they keep making and which the top management ignores. They loose quite a number of customers because of this. If you have the entrepreneurial blood,you have a business opportunity here.
    {{ DiscussionBoard.errors[11614553].message }}
    • Profile picture of the author Matthew North
      Originally Posted by Medon View Post

      I beg to differ, people don't open a business anticipating failure! In fact, majority of entrepreneurs start a business after identifying a gap that needs to be filled.
      My experience in working with startups or even people opening small a business mirrors what Jason and others wrote above. People are not prepared, don't have all the skills, the intention of actually doing it, or following through and making course adjustments. Also, the 'gap' that people identify usually exists in their own minds only and not in the real world.

      The first startup I worked for was for an enterprise SMS gateway, and it was an incubated project. The founder was a software engineer and had no prior experience in running a business. The sales manager he hired never made prospecting calls. That business today is still around and is still spinning its wheels.

      The second business didn't have a product that people wanted to buy, so they went out of business rather quickly. Simply not having something that people want to buy is the number one reason for failure of entrepreneurs, at least from what I I can gather from my own experience and that of my peers who work in sales and business development.
      Signature

      you cant hold no groove if you ain't got no pocket.

      {{ DiscussionBoard.errors[11614557].message }}
      • Profile picture of the author Jason Kanigan
        Originally Posted by Matthew North View Post

        My experience in working with startups or even people opening small a business mirrors what Jason and others wrote above. People are not prepared, don't have all the skills, the intention of actually doing it, or following through and making course adjustments. Also, the 'gap' that people identify usually exists in their own minds only and not in the real world.

        The first startup I worked for was for an enterprise SMS gateway, and it was an incubated project. The founder was a software engineer and had no prior experience in running a business. The sales manager he hired never made prospecting calls. That business today is still around and is still spinning its wheels.

        The second business didn't have a product that people wanted to buy, so they went out of business rather quickly. Simply not having something that people want to buy is the number one reason for failure of entrepreneurs, at least from what I I can gather from my own experience and that of my peers who work in sales and business development.
        I'm not sure they saw my second post, either. Jumping in with all the enthusiasm in the world will not overcome bad pacing or numbers. Having to make 30 or 60 sales in a month is simply too much for newbies, especially with no proven traffic source or conversion method. And they're not aware that this is the equation they've set up for themselves.
        Signature
        >> How To Grow Your Online Business [FREE Training Video, No Opt-In, from 12+ Year Vet]

        >> For Agency Founders: The Fast Shortcut To Selling SEO, Leadgen, Webdesign & Other Services
        {{ DiscussionBoard.errors[11614560].message }}
    • Profile picture of the author Claude Whitacre
      Originally Posted by Medon View Post

      I beg to differ, people don't open a business anticipating failure! In fact, majority of entrepreneurs start a business after identifying a gap that needs to be filled.Say for Instance you get employed by a fuel station, you work with them for a year and get pissed because of the mistakes they keep making and which the top management ignores. They loose quite a number of customers because of this. If you have the entrepreneurial blood,you have a business opportunity here.

      You just gave an example of a business that may succeed. Why? Because the person worked in that business and saw how it was run.

      You said "people don't open a business anticipating failure!" I think that is true. Probably always.

      In fact, it's the opposite. Most people open a business without any idea of how it could fail.

      Most first time business owners start their business on a dream and a little money. But it never even occurs to them to learn about that business first...actually work in that business, to see how everything is done. They aren't aware of the beginner mistakes everyone goes through, starting a business without experience. So their enthusiasm and belief in their idea can eventually carry them over the pile of early mistakes...or it can bury them in dept and lack of options.

      I suspect that we are talking about two different groups of people starting a business. I'm mostly talking about the rank beginner. And you may be talking about the experienced Entrepreneur. That's my guess.
      Signature
      One Call Closing book https://www.amazon.com/One-Call-Clos...=1527788418&sr

      “Do not seek to follow in the footsteps of the wise; seek what they sought.” - Matsuo Basho
      {{ DiscussionBoard.errors[11614561].message }}
    • Profile picture of the author DABK
      You are right. They do not anticipate failure. But they do not set up the business properly.


      Most people who do what you suggest, and there are many, remain in the mindset of a manager or technician.


      They end up creating a more stressful (and often) better paid job for themselves, not a business.


      They end up copying a lot of what they saw at the last business they worked at. They make some improvements, in the area of their specialty, and they are often not even aware of the rest that needs to be in place (and, preferably) better than at the last job they have.


      I'll give you an example from the real estate business that I saw repeated again and again.


      One person, good at appraising, gets fed up with the place they work and opens their own shop.


      They take a few of the clients with them... or get a few new ones.


      They fix the part that bugged them at the last place they work.


      But, years later, if they're still in business, they're in the same place (financially, growth-wise).


      They do not have a marketing system... When things dry up, they go on vacation, hoping... or they make phone calls... Till they get one new account... Or two.


      They hire an assistant... Who they have no idea how to train or in what... They just need help...


      If the business slows down, the assistant is gone... And the process repeats.


      They are the business... They do all the jobs... And they do not even write down what they do, so they cannot hire someone else and tells them, Go do this...



      Maybe they have a website, but it's not set up properly.



      Because they do everything, everything is attended to in crisis mode... And not well... Just good enough to buy another day or week.


      I started an appraisal company once... Thought I knew enough (from the place I worked at before).


      I ended up with a bunch of appraisers working for me...


      I know dozens of others who did the same within 2 or three months of me.


      Half of them went back working for someone else within 3 months. A bunch of them are still in business... Still the only one in the business. Still not able to take a vacation for more than 4 days.


      A few ended up with a bunch of appraisers working for them... And a couple ended up with national companies (or, in the case of one), regional but covering a large area (half of Indiana or Wisconsin).


      Starting with positive mental images and setting your business up to fail are not mutually exclusive.



      Originally Posted by Medon View Post

      I beg to differ, people don't open a business anticipating failure! In fact, majority of entrepreneurs start a business after identifying a gap that needs to be filled.Say for Instance you get employed by a fuel station, you work with them for a year and get pissed because of the mistakes they keep making and which the top management ignores. They loose quite a number of customers because of this. If you have the entrepreneurial blood,you have a business opportunity here.
      {{ DiscussionBoard.errors[11614575].message }}
      • Profile picture of the author Claude Whitacre
        Originally Posted by DABK View Post

        Because they do everything, everything is attended to in crisis mode... And not well... Just good enough to buy another day or week.
        I think you hit the nail on the head.

        In my retail specialty store, there are two kinds of people that open these stores (selling vacuum cleaners).

        1) A repair person who decides to be their own boss. But all they bring are skills in repairs. They cannot sell. They have no idea what marketing is. They have never run a business. They are always a week or so away from closing. To them, they think of it as hourly work...just like when they were working for someone else.

        2) The salesperson who decides to sell at retail, rather than sell in people's homes. Even if they know nothing about running a business, or marketing. They know how to sell, and that carries them through the day.. Eventually they pick up on the rest. Except marketing. Marketing and advertising are almost unknown subjects to these people.

        But since they have no marketing plan in place, they are always selling to pay yesterday's bills.

        My entire retail experience changed when I really started studying marketing. Marketing and advertising (done profitably) propelled my income comfort level to a new plateau.
        Signature
        One Call Closing book https://www.amazon.com/One-Call-Clos...=1527788418&sr

        “Do not seek to follow in the footsteps of the wise; seek what they sought.” - Matsuo Basho
        {{ DiscussionBoard.errors[11614586].message }}
        • Profile picture of the author DABK
          Seems to be a hard lesson to learn. I have relatives who opened businesses. I told them.... Well, I tried... They said, and I quote: "My business is different." (Different than any of the businesses I've owned or the ones I used as examples (past clients).


          Ideal audience? Everybody. "Ours is an emotion-based business... (Wedding dresses). If they like the dress, they will borrow or steal if they have to... And they'll come from all over the country..."


          She nearly had a heart attack when I suggested 'everybody' is not a good idea.


          She thought I was asking her to ignore people who came into her store to buy. Could really not comprehend.


          Fast forward 3 years: they're behind where they should be... One of the two owners is getting it now... but has no idea how to do it... And I gave up on helping for free. And they do not have the money to hire me. Not even with a big family discount thrown in.


          My point though: the certainty that they knew was tremendous. The idea that if brides see their dresses, they will love them and will steal or borrow if needed to buy.


          Not once did it cross their minds that in order for future brides to see they'll have to come across those photos... They have a store on a corner, by a stop light, lots of traffic, plus there's a Starbucks next door.... How would brides not going to see their dresses?


          Since they survived three years and one of them gets it (the other one is a good sale person... She can close them if they're in her store pretty well... Still does not think highly of creating an ideal customer.... Though they (she too) dropped the idea that everyone.... Now, they've noticed that they sell to brides in certain neighborhoods more than to brides in other neighborhoods (and some of those buying neighborhoods are farther away than some of the non-buying....


          She's still not getting the why, but see it the difference... (It is because in those other neighborhoods, they have more women ages 20-35... The other neighborhoods, they have kids through 20 and 40-60 and up.


          They had so much hope and convinced a bunch of people to lend them tens of thousands of dollars to open... But no systems.... They did not know anything besides what one of them (who had worked for a bridal store for a few years, knew.... And the other store... 16 years in the business and they make a bit over $100k a year, after expenses.


          These two are typical... Talked to a mortgage broker who'd just opened his shop. He also wanted everybody because he was that good and had such great loan programs.


          I asked him, If I get you someone looking for a $14,000 mortgage tomorrow, will you do it?


          He would not... He had no programs for anything under $50k. Moreover, he did not want to be bothered: he makes a percentage of the loan amount. He likes them to be $150k or more... Will do less because he has to, but he wants them 150k or more.


          He got the point... Till I met him a few weeks later, when he was back to everybody.... Took him a while to get Everybody out of his system.



          Originally Posted by Claude Whitacre View Post

          I think you hit the nail on the head.

          In my retail specialty store, there are two kinds of people that open these stores (selling vacuum cleaners).

          1) A repair person who decides to be their own boss. But all they bring are skills in repairs. They cannot sell. They have no idea what marketing is. They have never run a business. They are always a week or so away from closing. To them, they think of it as hourly work...just like when they were working for someone else.

          2) The salesperson who decides to sell at retail, rather than sell in people's homes. Even if they know nothing about running a business, or marketing. They know how to sell, and that carries them through the day.. Eventually they pick up on the rest. Except marketing. Marketing and advertising are almost unknown subjects to these people.

          But since they have no marketing plan in place, they are always selling to pay yesterday's bills.

          My entire retail experience changed when I really started studying marketing. Marketing and advertising (done profitably) propelled my income comfort level to a new plateau.
          {{ DiscussionBoard.errors[11614605].message }}
  • Profile picture of the author alihasan193
    Nice Awesome story, you can be proud.
    {{ DiscussionBoard.errors[11614589].message }}
Avatar of Unregistered

Trending Topics