One thing you definitely do not want to do as an entrepreneur is spend a whole lot of time building a business, tweaking and tuning it and getting it to a point where it’s making you some money – only to realise that it’s not really working for you.
And trust me, it happens more easily and often than you’d think. We’ve even been there ourselves.
This isn’t the business you were looking for…
When Rosemary started her entrepreneurial journey it was with property. It took a couple of years and tenants nearly into triple figures before we learnt that, although the business model was working (i.e. it was generating lots of money), we really weren’t enjoying the work.
How does that happen, and why did it take so long for us to figure that out?
The keys to sustainable business
The creation of a sustainable business occurs when you have good answers to the 3 questions below:
1. Who has money to pay you?
You need to figure out who your target market are and crucially, whether they have enough money to pay for your product or service. If you have a great product or service, but it’s targeted at a demographic that can’t or won’t pay for it – your business is unsustainable.
In our case, we had tenants who needed some place to live. Most people are willing to part with at least a little bit of cash to put a roof over their head.
We had passed the first test.
2. Who loves you?
As a landlord, Rosemary provided an unbeatable service to her tenants. Ok, I’m probably biased. But I could certainly tell you stories about us going above and beyond to deliver exceptional experiences to our clients while they were in our care.
We didn’t just deliver accommodation. Our tenants got a full package of services that included birthday cards and Xmas presents, amongst other things.
It’s fair to say that as a landlord, Rosemary was pretty darned loveable.
Test two – check!
3. Who do you love?
As clients go, we weren’t particularly enamoured by our housing tenants though. We often found ourselves dealing with relationship problems, damage to property, crime, non-payment and a multitude of other problems causing increasing degrees of headache.
Life wasn’t fun for us as business owners. And it wasn’t easy to see ourselves continuing to service clients in this way for the long-term.
We had failed the final test.
Don’t waste time
Ultimately, Rosemary was able to conduct an exit strategy from that particular business. Though she still acts as a consultant to the new owners. There were plenty of lessons to learn along the way. Some of them valuable to be sure. One of the most important though – is don’t start a business dealing with people you ultimately aren’t going to feel comfortable serving in the long-term.
You may not know that straightaway, and that’s ok. But it should definitely be on your radar to figure out as quickly as possible. And the same goes for the other questions.
- If you don’t love your client – your business won’t be sustainable.
- If they don’t love you – your business won’t be sustainable.
- If they can’t or won’t pay you – your business won’t be sustainable.
Make sure you have these questions at the forefront of your mind as you build your business. If you’re already up and running, consider them a health check. If you’re just starting out – try to answer them up-front. The sooner you figure them out, the less time you’ll waste building a business that ultimately won’t work for you, for your customers, or just doesn’t make the profit you need it to.