Friday, February 10, 2012

Expanding Your Business? Too Many Fail Because They Don't Get the Right Partner!



So many people have a great idea or they run a successful small business that it seems a no-brainer that they should expand and make more money with their service or product.




But when they do expand, they find that it kills their business. Of course there are a myriad of reasons why expansion of business can kill off a good idea or a great business, but I think one of the most common and avoidable errors is that these people who decide to expand choose the wrong partners.


Specifically, they choose someone they like or can get along with over the right person for the job.




Let me give you a good example. I have a friend in Hollywood who is a music producer and he does great work. He tells me that he is always looking to expand and grow his business, but when he does, he fails. He is an artist and has a reputation for being a genius creative mind. He is frustrated at not being able to expand and make more money. He wrote to me for advice and wants to know how he can take what he does and make more money with it. 


Here is how I explained this to him:


You are an artist. You shouldn't be expected to do the business part of this stuff. You need a partner.

The problem? Say a guy runs a family Italian restaurant. He thinks about making it a chain. Who does he hire? A friend who is interested in Italian food.

Bad choice.

He should hire someone who doesn't give a hoot about Italian food, but only cares about running restaurants at a profit. This person doesn't (and shouldn't care) about what kind of food it is. That is the concern of the first partner.

The first partner, the artist or craftsman here, is concerned with taste, aroma and authenticity. Most probably he is a cook.

The cook needs at least a business man to handle the books and figure out ways to take the cash intake and turn it into profits. 

The mistake that almost all people make when they expand their business (and fail) is that they hire their friends or people of a like mindset. For example, the Italian food chef will hire another guy who loves to cook Italian food (you know what they say about too many cooks in the kitchen?)


The first partner hires their friends (who are artists or craftsmen like themselves) who are great for cooking food, but terrible for handling books and financing. And that's where they set themselves up for failure.

When people want to expand and succeed in their business, they need to hire people with a different skill set than themselves; not always "pals" or "yes men" or people of like minds.

Get it?

You need to find that sort of person.

So, in summation, if you are an artist, craftsman, cook, designer, musician, producer or creator, when you want to expand your business, hire a businessman who has a coldly objective view of your work. If you want to take that mom & pop hamburger stand you have and turn it into a chain restaurant, do not hire a craftsman, hire a businessman who knows how to run a restaurant.

There have been very few people in history who could do both the creative side of business and the "business side" of business... Off the top of my head, I can think of Michael Jackson, David Bowie, Steve Jobs...

You need a good partner. Find one. 

Frankfurt Schoolgirls - Celebrity Twist

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