The following is a chapter in our book Do or Die. The book is no longer available but I hope you enjoy the sure-fire business approach
The answer to the question “Why are you in business?” is not “to make a profit”. The right answer is “to meet my (business) needs by meeting others needs in a way that adds value”.
This answer holds true for large corporations, for self–employed people, for primary, secondary, and tertiary industries, and even for people working in an organization.
If you think about it, you yourself are working to meet the business needs while meeting your own needs. Your business needs you to work in it, and you deserve to be paid for your time and energy. If you meet other’s needs through your business, then your business can meet the requirements for its needs. If you do, then profits become a natural outcome, because they are part of the business’s needs.
Our approach starts with the statement:
A Business Exists Solely To Meet Its Own Needs By Adding Value Through Services And Products To Meet Needs Of People Outside The Business With Real Enthusiasm.
This is a very general purpose statement, one that (except for “real enthusiasm”) applies to virtually every business. However, it is concise and clear, which makes it a good starting point for your Purpose Statement.
The first step is easy: you replace “A Business” with your business name. If you incorporate your business, this name is virtually perfect assurance of the uniqueness of the statement. For partnerships or sole proprietorships, you can register the name in various ways. Setting up a domain with the name is relatively cheap for uniqueness on the Web. Of course, there may be another company with the name in another country, but your YOURNAME.COM is protected as long as you keep it active.
“Real Enthusiasm” is something you need to demonstrate. We’ll work on what should be here in the next chapter. We’ve placed it here because it reminds you that, without enthusiasm, you’ll look like some of those businesses that are not really interested in the buyers of the products or services, but want to get paid. With enthusiasm, you start with the right attitude towards other people, and they react positively with it. It is infectious.
Now we can work on precision. In the above statement, there are three vague areas, each of which need to be covered in reasonable detail.
The first is the part in brackets. It is a reminder that your business does have needs. It is part of the full purpose statement because, if you don’t meet those needs, you can’t meet your needs, and, eventually, you will stop meeting other peoples’ needs. The reason for putting it in brackets is to show that your buyers don’t need to know it, but you, your staff and your associates need to know why you are doing business.
It will include things like taxes, administration, staff salaries and wages, the purchase of what you will add value to, your consumables and even the business profits.
The next is “Add Value Through Services and Products”. Every business provides some combination of services and products.
We, for example, deal with information and methods of implementing systems to make the best use of people and their skills. Sometimes, this results in a product (the system). Often, it is a report on some aspect of business. And, as consultants, we give advice, which is a form of information. We add value to something. That something is knowledge we have gained through reading books or through direct investigation (for example, surveys). When I work with a computer system, I add value through using the client’s computers and their available languages; I also add value by using teams to do the programming for my designs. This book is a product, but it consists of ideas and methods that are my experiences – I’ve added value to the paper or the electronic equivalent through my store of ideas and experiences.
So, look closely at how you will be adding value, and to what you will add value.
The last part is “meeting needs of people outside the business”. You might think this is “customers”. Our experience is that most business people who think that customers are things, so we have avoided the word customers in the basic purpose statement format.
Even with businesses that don’t think of customers as things, there is a danger in using the word.
A customer is someone who makes it a habit to do business with you, and habits are hard to break, even good habits. The fact is, most businesses today do NOT have customers. They depend on “Oncelers”(pronounced ONCE-LERS). A Onceler is a person for whom every buying decision is separate from all previous buying decisions. The Web consists mostly of Oncelers. Just because they bought something from you once does not mean that they are likely to buy anything else from you.
Think about this: how many times are you likely to buy this book? If you do buy it again, your reason for doing so is very different from the first time, even if you find the book extremely useful. You might buy it to pass on to other people or because someone has borrowed your copy and failed to return it. But you are not a customer for the book. You might buy other books from us, because we have our names on them, but the decision is not entirely be based on this book – it may be that you believe that we can offer an alternate view of different aspects of business, thus a decision not based on previous decisions.
I am not saying that you won’t have customers, but, if you gear your business to meeting needs for people, you are more likely to be in a position to create customers, instead of relying on Oncelers.
(The term Onceler, by the way, was first used in De Seuss’s book ,The Lorax. We’ve found it extremely useful to describe business behaviours, and have adopted it as part of our business teachings. We do not think that everyone will act like the onceler in that book.)
Most experts in advertising will tell you that an advertisement’s purpose is NOT to create customers, but to get a person to try a product or a service ONCE. The value and quality of the product and service given by the company might create a CUSTOMER. In the meantime, I will usually use “buyer”, “consumer” or “logical prospect”. These are general enough to cover both customers and oncelers.
Later, I will cover different consumer types (in the Relational book). The process is too complex for this chapter. For the moment, you need a “picture” of your typical customer. Many people have difficulty doing this.
- In one workshop, a furniture shop owner’s initial reaction was that EVERYBODY is his customer or potential customer. After all, everybody needs furniture. We probed: Do children buy furniture? –– Obviously not.
- About the minimum age for buyers? –– Usually about 20 or 21, as they set up their first home.
- What about old people? –– Very seldom.
- An estimate of the maximum age? –– Under 50, maybe 55.
- How often do people buy? –– Every five or six years, sometimes 10 to 12 years.
In five minutes, and with a few more questions, we identified that he had two main buyer groups and their basic characteristics: (a) people around 21, establishing their first home and starting a family, and (b) people about 45, moving into their final home, not expecting further family.
Both sets worked with a limited budget (the second willing to spend about twice the money of the first), and had income ranges of $24,000 to $28,000 and $40,000 to $48,000.
The first group mostly used hire purchase with a low deposit (over 18 or 24 months), while the second preferred to pay off the whole price in six months.
There were other characteristics, but this gives some idea of his available data. You probably know your “average consumer” better than you think. It just takes time and imagination to consolidate your information.
What you offer the consumer is VALUE and SERVICE.
Value is NOT simply price. If you establish your business solely on lowest price, unless you can consistently do so, you will lose credibility, and hence your customers.
More, this tactic will work only for a limited time. I call it the “gunslinger syndrome” –– you are the “best” until someone faster comes along. Eventually, someone will find a way to bring the price even lower. (I will say more on this in the chapter FORMULA FOR SUCCESS.)
Competition has little to do with price, although it seems that competition tends to lower prices. People are not fools; they make comparisons, and become buyers IF the “extras” you provide (the VALUE) is better than your rival’s offerings. If there is NO difference, then they WILL take the lowest price. Your option is to show that the difference exists.
Your best strategy is to ensure that you ALWAYS offer the most value; you need to determine what constitutes value in your business.
Corner dairies survived for so long because they were open at strange hours and were convenient. This increased the value of their goods, even though supermarket prices were much less. Now that supermarkets have similar hours, and people have transport, dairies are in trouble. Their replacement, by the way, is the local open–24–hours garage, with its convenience corner.
SERVICE is not a passive element. The best definition we have found is: helping another person reach his/her purpose while working towards one’s own purpose.
Your clients, whether “once–lers” or customers, have specific needs that relate directly to their (unstated) purpose. Most require outside help to meet those needs. Your business can only succeed if you can give that help. If not, then they will not use your business.
It pays to look closely at your business. Does it meet the needs of your typical customer? Then we can fill in the blanks of the purpose statement for your business. We’ve inserted a kind of template for you to use on the next page. If you have examined the ideas in this segment, you will find that you have very little difficulty in filling in the blanks. Remember, the ideal is to use as few words as possible to make this as readable as possible.
Having support helps you be purposeful. Share your business purpose and ask others to support you
To your Success