The 5 Parts Of Every Business
To build a successful business whether as a solo-preneur or team, you must understand the various part nay, the components of a successful business and how they function for your business. Like the human body, whenever a single part malfunctions, it affects the overall well being of the body. In the same manner, every part of the business contributes to the success or failure of the business.
Hence, you must understand the connection between all the parts and how to leverage them for your good.
But before I explore the different parts of successful businesses here is a quick definition of a business that hinges on the content.
A business is a repeatable process that makes money for you, the owner. Anything else is either a hobby or a waste of your time.
In other words, a business is a repeatable process that does the following;
- Create and deliver value (in the form of product or service)
- That people want or need (its target audience)
- At a price, they are willing to pay (to get the value)
- In a way that satisfies the customer’s expectations
- So that the business brings in enough money to make it worth-while for the owner to remain in business
It doesn’t matter whether you are running a solo-venture or a million naira business. Once any of these factors are missing from your startup, there is a problem with the business. You don’t have a business.
It’s important to understand that a startup that doesn’t create value for people is a hobby. A startup that doesn’t sell the value it creates is a non-profit organization (NGO). And any startup that fails to deliver on what it has promised its customer is a scam.
For your business to survive and thrive, you must be able to properly understand and harness these five parts of the business; value creation, a define audience, a good pricing method, customer’s satisfaction and bring in money enough for its operation, else you will inevitably be out of business. A business that fails to do the above-mentioned factors – will in no distance time lockup its door and go home. It is as simple as that.
To further emphasize the five parts of the business, you need to pay attention to these parts discussed below.
Every successful business is a fundamental collection of;
You are not in business to be known as CEO or Co-Founder. You are in business to provide value. And you do that by solving problems. That's what will make people put their hand in the wallet and paid you.
Paul Graham, the founder of Y Combinator puts it this way
“Make something people want . . . There’s nothing more valuable than an unmet need that is just becoming fixable. If you find something broken that you can fix for a lot of people, you’ve found a gold mine.”
And that’s a pure truth. Find something that people are dying to have; something that has become a thorn in people's flesh and fix it.
Take your time and examine major business brands in the world you will discover that they are filling a gap. Facebook, for instance, connects people globally – bridging the gap that has hindered communication across the borders.
There are many opportunities to be filled. Your job as an entrepreneur is to identify those things that people don’t have enough of and find a way to provide them.
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Creating value in business doesn’t necessarily mean to reinvent the wheel. Value creation can take on one of several different forms, but with an unchanged purpose: to make someone else’s life better or just a little bit better.
Without value creation, a business can’t exist.
In my previous publication, I said that every successful brand has a marketing strategy it uses. A good marketing strategy far more outweighs a good product or service. The reason is not farfetched.
No matter how tantalizing your product or service is if nobody knows about it – your business is doomed to fail. I have seen businesses with less value-oriented products doing extremely well than brands with superb products. The only reason lies in their marketing strategies. The brand that does well knows how to present its product to the audience; the brand knows the right audience to go.
Your ability to attract customers and instill demand for the product you have created is an integral part of your business.
So, you must be intentional and evaluate your target market to know the best bait that will hook them.
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Getting attention is not enough. You need to know how to sell your value to them. Jeffrey Gitomer said that people don’t like to be sold, but they love to buy. The question becomes how you will make your prospective customer buy what you have to offer. To achieve this, you need to offer them enough value that will convert them to loyal customers.
Assuming you sell clothes, providing your audience with vital information on the best dress code would go a long way. Prospect appreciate you more when you give them free information that will better their life.
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Your ability to turn prospects into paying and loyal customers will determine whether you will remain in business or not.
It is easier to sell to someone that bought from you before than selling to a new customer. You will spend more resources to even acquire them than it will cost you to retain old customers.
Once you can sell to a customer, ensure you sell them satisfactorily. Live on your promise. Don’t promise what you can’t give to your customers. Giving your customers what you have promised and ensured they are satisfied and will make them come back to business with you again.
The last part of your business you should pay attention to is the financial aspect. Your business must be able to generate you enough fund for the day to day running of the business. To ensure that you achieve this, you need to separate your business finance from your personal finance.
Every successful business is simply a process of identifying a problem, creating a solution around it and marketing the solution to those who need it, which in turn benefit both parties. A business is a two-way street – giving value and making value.