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Starting a Small Business Is Just Like Running the Peachtree...Only Tougher
STARTING A SMALL BUSINESS IS JUST LIKE
RUNNING THE PEACHTREE…ONLY TOUGHER
I started jogging several years ago. It was a New Year’s resolution. Like most of my New Year’s resolutions, I was confident at the time that the euphoria of the holiday season would end soon and so would my brief encounter with running. Unfortunately, that was not the case this time.
Six months into the year, I was still running several times a week and had even extended my endurance to about two miles a run. It was at that time that a good friend of mine suggested that I enter the Atlanta Peachtree Road Race. What a ludicrous idea! The “Peachtree” was a 10K (6.2 Mile) run. This was way beyond my running capabilities. Besides, there would be 50,000 other runners and several hundred thousand spectators. Not a chance…
As I considered this “opportunity” (that’s what my friend called it), I thought back and considered that this would be just about the craziest stunt I had attempted in about fifteen years. That was about the time it was first suggested that I should manage a family-owned business. In hindsight, I recalled that I had survived that “marathon” and two more small businesses after that.
I began to consider the notion that preparing for and participating in this race would be much like preparing for and starting a small business. Or would it?
When I decided to enter the Peachtree, the first thing I did was tell my family and close friends of my intentions. This experience reminded me of when I would tell a similar audience of my intentions to start a new business. Most people thought I was crazy. Some people shared the same excitement that I did. Some people even offered to help me prepare. My wife increased the death benefits on my life insurance policy.
My next step was to initiate some strategic planning. First, I attempted to determine objectively what my condition was at the time. I even did a quick S.W.O.T. (strengths, weaknesses, opportunities, & threats) analysis. I concluded that I was in pretty good physical shape (strength), I had never run anywhere close to six miles before (weakness), the environment of the race should be a motivating factor (opportunity), and there had better be paramedics on call and ready to administer lifesaving techniques (threat).
The second step in strategic planning was to establish several goals. I decided that I wanted to finish the race by my own will, I would not be the last finisher, and I would get an official race T-shirt.
This reminded me of planning for a small business start-up. Most of the time we don’t plan to be the biggest or the best company in our industry or market. We tend to only focus on survival. I wonder how I would have placed in the race if I had planned to win? I wonder how successful my businesses would have been if I had planned from the beginning to be the largest, most successful, and most profitable company.
Once I had determined my present condition and my destination (my goals), I now had to develop an action plan to facilitate my training. I decided that prior to the race I would run a minimum of three times a week. Every week I would try to push my endurance one step further.
I also needed to conduct a little market research. I needed to study the history of the Peachtree Race and the layout of the course. How many spectators would there be? What kind of weather could I expect? Who was my competition? What were past winning times? (not particularly relevant in my case). What were average times? (more important) What was the worst time last year? (critically important)
My planning and training took about six months. Coincidentally, the average small business takes six months to start the business from the time of the initial decision to start the business to the first day of operation. My experience is that on average, the most successful small businesses are the ones that take the necessary time to plan their business and get "in shape". It's than those businesses that start without a plan of attack and without the necessary resources that than take the quickest exit from the "race".
The day of the Peachtree Race finally arrived. I found myself asking the same questions that many small business owners ask themselves on their first day of operation: "How long will I last?, Do I have the
resources to finish the race?, What if I stumble and fall?".
The start of the race reminded me of a Grand Opening. There was music, drinks, and lots of paparazzi. There was an electricity in the air.
The race had over 50,000 runners. Some were noticeably bigger and faster than I. Some had obviously prepared better than me. Some even seemed better equipped than me with headphones, expensive running shoes, and fashionable athletic attire.
Likewise, close to one million businesses will be started in any given year. Some of those businesses are bigger and faster than others. Some of them are better prepared than their peers. Some of these start-ups are even better equipped than other new businesses with high-tech offices, well-trained staff, and plenty of cash reserves in the bank.
As the race started, I was initially disappointed that the pace was so slow. The first quarter of a mile we walked. Slowly, we picked up the pace into a slow jog. Finally, after the first mile, we were able to hit our stride. Even than, the pace of the run was sporadic as went up and down hills, around slower runners, and stopped for water periodically.
Starting a business is the same way. Very rarely do our actual sales in the first months or first year match our revenue forecasts. Too often small business owners are far too optimistic about the "pace" of their start-up. They don't anticipate the peaks and valleys. They don't expect to have to maneuver around their competitors. They don't imagine that they will run low on cash and have to acquire additional financial resources to keep the business running.
It wasn't until the end of the fourth mile that I began to gain confidence that I was going to finish the race. No matter what, I knew that I could survive the final two miles. I had momentum. I had settled into a comfortable stride that I felt I could maintain to the finish.
It wasn't until the end of the third year of my business that I felt that we had survived the worst. Research on small businesses has shown that the average such business doesn't show a profit until the third year. The majority of small businesses fail to make it to their fifth year.
I was nearing the finish line. A number of other runners have stopped running and were now walking and even stumbling to the finish. They were determined to finish the race no matter what.
They reminded me of so many small businesses that I have witnessed. Tired, stumbling, their resources almost entirely drained. I often times wonder what drives these people towards such pain and suffering? Why not stop? Why not ask for help?
At last I crossed the finish line. I was filled with mixed emotions. I was ecstatic about finishing my first Peachtree Race. I was proud of the fact that all of my training and preparation had paid off. I was overwhelmed by the standing ovation the runners receive from the huge crowd assembled at the end of the race.
I was also worried. Worried that this was just the first of many races and I needed to improve my training and my skills in order to improve my time. I was also fearful that this might be the last race I finish as the aging process begins to take its toll.
Three days later I was back on the streets training for the next race.
The fifth year of my business, we finally achieved our sales projection. Once again, I remember having mixed emotions. I was euphoric over achieving our sales goal. We had an office party and celebrated. I was proud of the business we had built and the people who made it possible. There was no standing ovation but the look of achievement in the eyes of our employees gave me that same goofy feeling.
I was also worried. Worried that this was just the first time we had achieved our annual sales goal and that we needed to continue to grow the business and improve our ways if we were to remain competitive in the market. I was also fearful that we did not have the financial and intellectual capital to continue to prosper.
The next day I opened up the office just as I had each working day the previous five years. Just another race…
About the Author
Tim Fulton is a nationally recognized small business consultant and
management trainer. He is also a very popular public speaker. Tim can be reached at timfulton@hotmail.com.
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