Four Elements of Business

Learn the 4 basic elements of your business now!
Learn the 4 basic elements of your business now!

I’ve narrowed the idea of “business” down to four basic concepts that apply to EVERY business:

1. Service/Product : What is your special service or product that you offer to consumers? Is there a need for it? How great is that need? Is your product/service a short-term or long-term solution? Do you have competitors? These are questions that absolutely need answering before you invest a ton of time, money, and energy into a business. The livelihood of a business is based on “demand.” Demand is a term used in business and it refers to the quantity of people searching for your product/service. In my current field (roofing), the demand is high and the need is long-term. Roofing, particularly, is very competitive due to its high demand. If your product or service has many competitors, then make sure the market is not over-saturated before you enter it. Also, ask yourself what differentiates your product or service from your competitors?”

4 Elements of Business
Your business has four elements. Learn them here!

2. Operations… my FAVORITE part of business! The way you operate your business will impact your success. You can have a crappy operation and barely make money OR you can have a seamless operation that generates a ton of profit! Operating a business is all about process. Of course, your process will continue to change and improve as your business grows. I suggest drawing out a map of how you want your business to flow (we call that workflow). Use the map to determine what you already have in place and which new processes you need to add. Evaluate and improve your process often. Read how changing our process at the roofing company made us more successful. 

3. Did you start your business so that you’d be broke? If probably feels that way if you’re within the first three to five years of launching your business. Money management is a huge part of running a successful business. Don’t avoid this topic like many start-ups often do. It is crucial that you learn how to manage overhead costs from the very beginning. You can do that with a BUDGET. Every business, small or large, should operate with a budget. See my post How to Make a Budget. I also recommend that you use a bookkeeping software such as Quickbooks. Quickbooks is easy to use and will provide all the necessary tools to analyze profitability plus manage customer invoices, vendor bills, and even run payroll.

4. Its finally baseball season and I can hear the food vendor shouting it now, “Peanuts! Get your peanuts!” Believe it or not, that is a marketing tactic. The food vendor is making it convenient and enticing for you to buy their product. Would you have stopped at the store for a bag of peanuts prior to the game? Probably not. You probably didn’t even want peanuts until you heard the word. That is clever marketing and you need the same for your business! Marketing is defined as the “management process through which goods and services move from concept to the customer.” You can read more about the four elements of marketing at http://www.businessdictionary.com/definition/marketing.html.

 

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