Tag: “small business”

Find Small Business Success with The Pumpkin Plan

Around this time each year, you’ll see a news story about a farmer with a record-sized pumpkin, one much bigger than anything grown by his neighbors. How did he do it? How did he find success in the pumpkin patch?

He did it by nurturing his best pumpkin, a principle that can be applied to any small business. That’s the message of The Pumpkin Plan, a new book by Mike Michalowicz.

To make your business thrive, you must weed your garden, like a good farmer. This means removing the pumpkins that are too small or not worth your time, so as to focus on the one great gourd that can grow bigger than all the others.

In other words, the Pareto Principle. 80% of your sales come from 20% of your clients. The key to growth is to focus on the most profitable activities of your business.

(I satirize this idea in my novel Don’t Mess Up My Block, where my narrator chooses to eliminate all distractions – even family – to concentrate on getting rich.)

The most interesting section of The Pumpkin Plan is where Michalowicz talks about failure. So many entrepreneurial titles gloss over the hard work of building a business – yet, this is the norm. Each year Americans start one million new businesses, nearly 80 percent of which fail within the first five years. Michalowicz frankly discusses how his company was eating him alive, consuming every waking hour and ruining his family life. Only by concentrating on what he did best was he able to escape this trap. He learned to weed out the activities that weren’t worth his time so as to focus on his best customers.

Michalowicz is a serial entrepreneur who started his first business at the age of 24, moving his young family to the only safe place he could afford – a retirement building. With limited resources and no experience, he systematically bootstrapped a multi-million dollar technology business, sleeping in conference rooms to avoid hotel costs. After selling his first company, Mike launched a new business the very next day, and in less than three years, sold it to a Fortune 500 company. In the Pumpkin Plan, he describes his life story as well as the stories of similar entrepreneurs.

This is not a book of theory. It’s chock-full of real-world examples from people who have had to sell products, make payroll and keep themselves sane. Chapters expand on the Pumpkin Plan concept, with checklists on how to discover what you do best and how to get back on track if you stray.

What’s your Great Pumpkin? This Halloween, find out with The Pumpkin Plan.

The $100 Startup – Chapter Two: Give Them the Fish

fish tank

Some books deserve a closer read. One of these is The $100 Startup by Chris Guillebeau.

In the first chapter, Guillebeau set the stage, like a good novelist would. He brought out his main characters (unexpected entrepreneurs) and introduced his theme: building a microbusiness.

Now, in this second chapter, we get into the work of figuring out what kind of business is best for you.

But, first, a parable, one we’re all familiar with.

Give a man a fish and he’ll eat for a day. Teach a man to fish and he’ll eat for a lifetime.

Yes, but when you go out to eat you don’t want to catch, clean and cook your own fish. You just want the fish. Give the customer what they want, instead of what you think they need.

This point is illustrated by the story of the V6 Ranch, which looks like loads of fun. This dude ranch offers more than just horse rides, they give their stressed Californian guests the chance to “escape and be someone else.”

Across the country, Kelly Newsome brings serenity to uptight Washingtonians through her yoga practice. As an ex-lawyer, she understands the pressure of the rat race better than anyone.

These two businesses understand that value means helping people. It is not about a long list of features – horse rides, yoga classes – but instead the value of the business comes from benefits. A meal by campfire is a feature; the feeling of relaxation you get is a benefit. Customers want benefits not features.

Focus on benefits when considering ideas for your own $100 startup.

Guillebeau illustrates this further with an example from his own business. He developed a product called Travel Ninja, based upon his round-the-world adventures. It was a detailed explanation of how to earn frequent flyer miles and book your own travel. It flopped. Customers were overwhelmed by the complexities of the offer. They didn’t want to know how the airline mileage system worked; they just wanted to be told what to do to get the best deals. He refined his product and developed the Travel Hacking Cartel, a simple guide to rapidly earning frequent flyer miles.

Honing in on what people actually want is key. Customers didn’t want to learn the ins and outs of the airline biz, like Guillebeau had. Instead, they wanted to travel to the places of their dreams. People aren’t attracted by features (detailed knowledge of airline programs) they just want the benefit (a memorable week in Bali).

The chapter closes with the story of Brooke Snow, a lifestyle photographer in Utah. I know a lot of talented photographers. With everyone a photographer these days, it’s a brutal business but Snow has differentiated herself by teaching classes online. This “professor of meaningful creativity” teaches courses on technique and storytelling, all of which are sold out. She shares her trade secrets, overcoming the fear that she was training the competition.

In the words of Guillebeau:

When all else fails, ask how you can help people more.

Give people what they want. Give them the fish!

For More Information

Have the dream of being a wedding photographer? My friend Mary Kate McKenna offers a reality check.

Are there too many yoga studios?

Another way to look at features vs benefits is in the recent Mad Men episode on Jaguar. Rather than pitching features in their ad (leather seats, British engineering), the team comes up a persuasive line that is all benefits, “At last, something beautiful you can truly own.” It’s about the emotional experience of owning a Jaguar.

Next: Follow Your Passion… Maybe.