What does it take to make a business successful? If you’re a business owner—or thinking about launching a new business–you’ve probably asked this question. In Cash Flow Cure, we break success down into three distinct accomplishments your business needs to achieve.
To reach success, your business needs to 1) Provide Value to the Marketplace, 2) Provide Personal Income and 3) Build your Freedom Generator. This week we’re exploring these three accomplishments and looking at exactly how you can put them into place in your business.
Accomplishment #1: Provide Value to the Marketplace
Beware the dreaded OED – Optimistic Entrepreneurial Delusionism. OED will kill your business even before you get it off the ground. Simply put, you need to make sure there is a market for what you want to offer. Too often entrepreneurs get so excited about a new product or service they fail to figure out if their customers even want it.
OED can lead to countless hours and dollars being invested, only to see your product fail spectacularly. Let me give you an example.
In the year 2000, the Heinz Corporation in the US decided that what the market really needed was a new form of ketchup. Great! Except this ketchup was green. As a promotional item to coincide with the release of the movie Shrek, green ketchup was initially a hit. But after the novelty wore off, sales of the green ketchup fell dramatically. When Heinz finally discontinued the new color in 2006, they’d lost millions. The green ketchup didn’t provide enough value to make it a success.
Don’t make the mistake of bringing “green ketchup” to the marketplace. Be patient and take the time to ensure your product or service provides real, lasting value to your customers.
Accomplishment #2: Provide Personal Income
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How much profit does your business make? How much of that are you using to pay yourself on a regular basis? Your business should be generating enough income to provide for your Baseline Living Expenses. If you haven’t already calculated this number, take some time to do so now.
Your business may be generating $500,000 a year in sales, but if you’re not Financially Secure and working toward Financial Freedom, your business isn’t successful. Remember, it’s not what you earn, it’s what you get to keep.
But more than just covering your basic living expenses, your business also must provide enough to fund your Freedom Generator. The Freedom Generator is a vital part of your journey to Financial Freedom. Speaking of…
Accomplishment #3: Build Your Freedom Generator
I’ve said it before, and I’ll say it again. Freedom comes from outside your business, not inside.
Your Personal Financial Freedom is the ultimate goal, and your business should be accelerating you toward this goal. As a Cash Flow Cure community member, you’ve heard us say you need to build Financial Freedom into your business from the very beginning.
How do you do this?
First, be clear on the type of business you’re running: Profit or Legacy.
Second, know the Minimum Profit Number you need to achieve Freedom within your Maximum Freedom Timeline. You should know exactly how much your business needs to produce in a specific amount of time to fund your Freedom Generator. Knowing your goal will help secure your Financial Freedom.
Is your business producing the amount of profit necessary to fund your Freedom Generator? Are you going to be able to achieve your Freedom within your Maximum Freedom Timeline? If it’s not, you need to work through Module Three of Cash Flow Cure to learn how you can!
The Road Ahead
Most business owners rely on their business to provide for their every financial need. But mixing your business and personal worlds is inherently dangerous and not a sign of a successful business. That’s because if your business suffers, your personal finances are affected as well. Work through Cash Flow Cure to evaluate and put into place systems so you know your business is providing value to the marketplace, providing personal income and building your Freedom Generator. When you accomplish these three things, your business will be successful, you’ll be Financially Secure and on the path to Financial Freedom.
If you haven’t reached this point yet, the good news is you still can. It’s never too late to start. Your business should be working for you, not the other way around.
Have you accomplished one, two or all three of the requirements for a successful business? Share with us in the comments below or in the Business Owner Only community!
image credit: Bigstock/Dudarev Mikhail
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Makaylah Rogers is the co-founder of MindShift.money. She is a Thought Leader for her generation, teaching people how to rewrite their “money rules.” With an extensive background in wealth building and personal development, Makaylah’s path has taken her into executive roles in various fields including launching startups, real estate sales and motivational keynote speaking.