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Thread: Fundamental business principles - Get and keep customers

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    Site Caretaker Dave A's Avatar
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    Fundamental business principles - Get and keep customers

    First a couple of observations. Doing business in South Africa has become increasing complicated. And perhaps it's not just a South African phenomenon. There seems to be an ever-increasing list of demands that have little to do with a successful business. Like corporate social responsibility, and turning our offices and workshops into primary school level classrooms. Things that government should be taking care of. Our education system. Our taxes. Our favorite charities.

    My next observation is that as a business grows it gets increasingly complicated. It's so easy to forget about the basics. And yet it is vital that we don't lose sight of the fundamental principles that got us to our complicated business in the first place. Because they still apply.

    My final observation is that we tend to hop around in discussing business related topics. There's no problem with that and by all means let's continue. But I think it's time we also laid a foundation of basic business principles that are built from the ground up.

    So here is the start of a series that I hope we are going to work through together. For anyone in the early stage of the business experience, we're starting from where you're at. For those of us who have been at this for a while, it might be useful to remind ourselves of the simple things that we tend to take for granted or forget in the midst of all those seeming complicated decisions.

    Add your comments along the way. Ask questions. And let's build this from the ground up.

    Now I don't pretend to know all of these rules. But I'll talk about the ones I've found. And maybe you'll take the time to talk about the one's you've found. Or you might take the time to disagree. And perhaps this will become the definitive series on business from the small business owners perspective. Goodness knows there seems to be a need for it.

    So, to kick this off, let's talk about the purpose of a business. Not your business, but ANY business. Because if we talk about your business, we're going to get confused by your dreams, needs and aspirations. Not that those aren't important. They are your drivers that will get you to do what it takes to move your business forward.

    But a business is an unemotional machine. The product depends entirely on the raw materials put in and how they are processed. And just as there are laws of physics that determine these things in the material world, there are similar laws of business that determine the results of a business based on the raw materials and the way they are assembled.

    So you might think the purpose of your business is to make you enough money so that you can build a boat and sail around the world, or to pay for a three month vacation, or (add your own purpose here) - but in reality that is your purpose for having a business. And I'm sure we can get to discussing that too.

    So right now - first things first: What is the purpose of a business? Any business?

    The best I've ever heard is to get and keep customers. It really sums it up in a nutshell. And it's blunt enough to reflect the real character of business fundamentals. Can you think of an example where it does not apply?
    The trouble with opportunity is it normally comes dressed up as work.

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    Platinum Member Marq's Avatar
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    To make a profit

    The best I've ever heard is to get and keep customers. It really sums it up in a nutshell. And it's blunt enough to reflect the real character of business fundamentals. Can you think of an example where it does not apply?
    If you have the wrong customers, like those that don't pay or those that create problems then it does not apply.

    I was always taught that the main purpose of any business was to make a profit. Still works for me.

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    just me duncan drennan's Avatar
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    I think it may be a twofold answer encompassing both the why and the how.

    I think that the why is to support the lifestyle of the owner and the employees, i.e. gainful remuneration. (so I agree with Marq here)

    Why do most people work when they would "rather be fishing/golfing/skydiving" etc? I think that if everything is stripped away it comes back to the basic need to feed, clothe etc. ourselves. Yes, there is FAR more to this (just have a look at Maslow's hierarchy).

    Now on the other hand there is the how, and I agree with Dave, get and keep customers
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    Site Caretaker Dave A's Avatar
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    Aah yes. A live one

    The main purpose is profit. The main activity is get and keep customers.

    Thanks Marq and Duncan. I'm going to be doing my writing on this series at night for a while. Not the best of time for this but at least I know I've got you to keep me on my toes.
    The trouble with opportunity is it normally comes dressed up as work.

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    Site Caretaker Dave A's Avatar
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    I'm surprised no-one has pasted me for describing business as an "unemotional machine".
    The trouble with opportunity is it normally comes dressed up as work.

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    just me duncan drennan's Avatar
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    Quote Originally Posted by Dave A View Post
    I'm surprised no-one has pasted me for describing business as an "unemotional machine".
    [SIGPIC]Engineer Simplicity[/SIGPIC]
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    Platinum Member Marq's Avatar
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    I'm surprised no-one has pasted me for describing business as an "unemotional machine".
    I agree with this statement - its the bodies driving and steering the machine that have the emotions.

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    Quote Originally Posted by Dave A View Post
    The best I've ever heard is to get and keep customers. It really sums it up in a nutshell. And it's blunt enough to reflect the real character of business fundamentals. Can you think of an example where it does not apply?
    OK. Why do you spend time and money on SAPCA or here.
    Quote Originally Posted by Marq View Post
    If you have the wrong customers, like those that don't pay or those that create problems then it does not apply.

    I was always taught that the main purpose of any business was to make a profit. Still works for me.
    So maybe it should be changed to get and keep the right cutomers.

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by entoserv View Post
    OK. Why do you spend time and money on SAPCA or here.
    Now where have I heard that before? I think you've just blown your cover - I had wondered...

    I think part of what is highlighted here is the seperation of personal and business interests. My best explanation is that these activities are my way of giving back some of what I have received and it's at a personal level.

    However, in saying that, I have learnt so much from the experience that I don't think I'd have learnt elsewhere, and that should make me a better asset for my business.
    The trouble with opportunity is it normally comes dressed up as work.

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    Silver Member Candy Bouwer's Avatar
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    I'm surprised no-one has pasted me for describing business as an "unemotional machine".
    Well it certainly can't start without being unemotional...i would imagine it would start with a vision, a goal and then a personal purpose to succeed. Unless of course you are a huge giant in industry already. Getting and keeping customers is a heart attitude too.
    "NETWORKING" is a "CONTACT" sport!"
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