If you have been self-employed then you just accept this as a funny quote, originally from Homer Simpson. Personally, I could not abide the Simpsons and have never watched more than I was required to do out of politeness. However, for many people this is the truth. They believe that anything they try will almost certainly end in failure.

You have to fail a few times to understand that, as long as you still have the resources to carry on, failing does not matter. It was just a necessary step on the road to your current success.

Just like so many other people we have had our share of failures. Now, we may not have the most successful accounting practice in the world, but I think that for the two of us, Helen and myself, we have done not too bad. But along the way we have had our share of failures and disasters both within the practice and outside. I subscribe to the theory that this is how you grow. I know that others don’t agree with me. You may be right!

About 20 years ago, the practice was ticking away satisfactorily but was about a tenth of its current size. Nevertheless, it was ok. We got tempted to diversify into an area in which we did not have experience. It failed but the lessons that we learned gave us the means to grow our accountancy practice and ourselves. It was the reason why we are where we are today.

I have known many business owners who left school as soon as they could with minimal exam success. And yet today they are amongst the most successful business owners we know. No certificates, no degrees, just character and life experiences to draw upon. I have often said that the basics of business are learned in the playground at school. It is how you interact with those around you and learn what you can and cannot do and the basic principles of how to generate a profit. Sometimes having too much intelligence just means that you have the capacity to think about all the reasons why you should not do something, and why it is likely to fail. Sometimes brute force and ignorance are an advantage over intelligence.

Most of the successful businesses seem to be a combination of one spouse, typically the man, who is all brute force and ignorance, who is partnered up by marriage or whatever, with an intelligent other, typically a woman. Now, I am not saying that this is invariably the case, but I am basing my conclusions on the first few highly successful self-made businesses that come to mind. Mind you, I know of exceptions to this rule so it is clearly not universal. It is maybe a function of the nature of the trades I have in mind such as fishing, contracting and farming.

It begs the question of how many people with business degrees, MBAs and the like, have actually been successful in business. They will have excellent CVs on paper but will they have had the life experiences to enable them to succeed in business? Likewise, the skill required to oversee and manage a large business, that someone else has built, may be insufficient to start and run a small business. I think there is an assumption that if you can manage a large business, then you can run your own small business.

Many years ago, I was advising someone who wanted to start their own small business. They had only ever been employed by large companies. They spent what seemed like months agonising over the name and logo. I told them to go out and get a customer. It has been said that if you cannot find 10 customers, you do not have a business. Anway, I met up with them again sometime later and they had gone back to their old job. Getting a customer is harder, but much more important than names, logos etc. You can worry about those later.

But, there are plenty of people who will tell you that you need to get all these things in place. You need a name, logo, mission statement, business plan and the rest. You just need a customer.

For most small businesses, their business plan is in their heads. They just need people like us to set it out in an excel spreadsheet. Can you find customers willing to pay you money?  Can you find and control staff? Can you make a profit?  Do you have the strength of character to decide on prices that give you sufficient profit so that you can in fact continue to trade?

Running a small business is tough and people who have only ever been employed can only imagine just how tough that is. How often do you wake up at 4am worrying about cash flow? Still, it’s better than being told what to do by a manager or an employer!

I was never a good employee!

Alan E Long

The Long Partnership

07770 738770