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Essential Business Skills

    Having a business idea is exciting! You can’t wait to bring your idea to the world and make your fortune.

    Being one of the minority who actually takes action, you actually get started and you realize that starting and running a business is actually hard work and requires certain business skills to establish the business and assure it will survive and grow.

    First, marketing. You love and are excited about your business idea, product or service. Are there an identifiable group of customers who want it? How can you reach them? What message will appeal to them? How much will it cost, and will the effort generate enough revenue to pay the business’s expenses plus a profit, so you can pay your bills? Does your idea “pencil out”?

    Second, sales. Once customers are identified, can they be persuaded to actually buy your product or service?

    Third, legal and accounting. What government regulations apply to your business? How should your business be structured? What state or country should you be headquartered in? How will your intellectual property be protected? What records should be kept for tax reporting and for measuring the performance of your business? How will you handle billings and collections? How will you manage paying your employees and bills on time?

    Fourth, finance. How will you raise the seed money to start your business? When it grows to a certain size, it will probably have to issue stock. The business will likely require bank financing. The cash flow and cash requirements for the business have to be monitored and managed.

    Fifth, production. Does the product require manufacturing? Should it be done in-house or outsourced? If it will be outsourced, will it be done in the headquarters country or outside? If the business is a service business, it will probably require employees or contractors to perform the services. Manufacturing businesses purchase parts and materials and usually require employees and specialized equipment. A business that manufactures in-house will probably need a building or space in a building to house it.

    Sixth, research and development. The pace of change is dizzying. What new products or services will your business offer when your current idea becomes tired or obsolete, or competitors offer knock-offs of your product? What else can you offer the customers who buy your flagship product or service?

    Seventh, management. The textbook definition of management is planning, organizing, implementing and controlling. Someone has to oversee how all of the pieces are working together. Someone who has great people skills to work effectively with customers, employees, service providers and suppliers.

    Eighth, leadership. Bringing your idea into reality is a form of leadership. Leadership involves inspiring others to take action, often using symbols as simple as a baseball cap. Leadership also involves navigating difficulties that are inevitable for any business.

    A business can quickly grow past the point that one person can fill all of these roles. Even small businesses will hire outside specialists to cover some of them, especially legal and accounting, and will often subcontract production.

    Most individuals don’t have strengths in all of these business skills and need partners, employees and consultants to handle the areas where they are weak. A classic example was Walt and Roy Disney. Walt was gifted in generating ideas and managing the creative people to bringing them into reality. Although Walt managed the artists working on his projects, he was mostly a consummate leader, sharing his plans for his movies, Disneyland, and Walt Disney World with the public on his television show. Roy worked with investors and bankers to be sure there were enough funds to finance Walt’s projects and managed collecting the revenue and paying the bills. He would remind Walt of potential limitations for his projects. Roy was a consummate manager. When Walt died, Roy stepped in to assure Walt’s vision of Walt Disney World became a reality.

    As you begin your quest to introduce your business idea, remember to plan and provide for all of the business skills required to have a successful business.