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Business Strategy

A business strategy is formulated by selecting the target audience of the product and assembling the marketing mix. A firm can assemble marketing mix elements in many different ways so that the relative weightage of the different elements will be different in the different combinations. Because of this reality, business firms are employing an abundance of strategies and strategy stances. It is a relentless race to stay ahead of competition.

Basically, however, there are only two broad routes available for forging business strategies. They are the price route and the differentiation route. In other words, any strategy has to be ultimately either a price-based strategy or a differentiation-based strategy.

Companies taking the price route compete on the strength of their pricing and the price cushions they enjoy. Normally, those who resort to the price route and compete on price will enjoy substantial cost advantages, giving them flexibility in pricing and marketing. The differentiation route, on the other hand, revolves around elements other than price. The product with its innumerable features is one major source of differentiation. In fact, any of the ever-so-many activities performed by the business unit can constitute the nucleus for differentiation.

In other words, differentiation allows the company the freedom and flexibility to fight on the non-price front. Differentiation, therefore, is a crucial option for a firm in its search for a rewarding strategy. A good majority of business battles are in fact fought with a differentiation-based strategy rather than a price-based strategy.

As already mentioned, a business unit that opts for the price route in its competitive battle will enjoy certain flexibilities in the matter of pricing of its products, and use price as the main competitive lever. It will price its products to suit varying competitive demands. It will enjoy certain inherent cost advantages, which permit it to resort to a price-based fight.

Voluntary Business Blindness Is Just Dumb!

In simple terms, in order for you to have more business freedom, your business needs to be

Profitable

Predictable

Expandable

Able to operated without you

It may or may not surprise you to learn that many – if not most – businesses do not meet ALL of these criteria.

Why not?

Well, it’s not necessarily because they are bad businesses. And it’s not usually because the owners of the businesses are bad business people.

From my experience, it is because the businesses have not been developed or structured to meet these criteria. But sometimes “Business Blindness” gets in the way.

Starting, owning and running a business takes passion and commitment and persistence. And courage. Guts.

Often in the middle of the passion, the commitment and the persistence, we business owners become blind to what is actually happening in the business. We become blind to what we need to do to improve, change or re-structure the business to give us what we want. It’s Business Blindness!

The business needs to give us more of what we want – and less of what we don’t want. But in the heat of business battles, when the very survival of the business can be on the line, we sometimes forget what we really wanted when we started the business. We get caught up in “the business” – and often keep going doing stuff that doesn’t make a lot of sense – in the name of persistence, commitment and passion. That takes courage – but it’s just dumb.

Business Blindness is Dumb.

Blind passion is dumb. Blind commitment is dumb. Blind persistence is dumb. And having the courage to continue to do dumb things – is just dumb.

Staying on the business owner’s treadmill with no business freedom is just dumb too.

But, Business Blindness is voluntary. It’s our choice. Or generally, more correctly, it’s when we abandon our right and responsibility to make uncomfortable choices. Sticking our head in the sand of our own business also leads to blindness…

We don’t have to be blind in our own business, but we do need to remember to open our eyes. And we do need to make better choices – and take responsibility for our choices.

It’s time to open our eyes and re-look at our own business. We need to take more time out of working IN the business and start working more cleverly ON the business.

Most business owners don’t make enough time to work ON their business. Generally, it’s not because they don’t want to, but because they get so caught up in the “doing” of their business that they have no time or energy left to figure out what needs to be done to extract themselves from their own business.

But that is just continuing the Business Blindness – and continuing life on the treadmill!

One definition of insanity is “Doing the same thing over and over again and expecting a different result”. To get Business Freedom, you don’t want to be doing the same things over and over again – if they are not working for you. You will need to be doing things differently. And you’ll probably need to be doing different things.

It’s important to realize you can change. Things can change. You can change the things you do.

Some Big Questions for you…

  1. Do you want your Business Freedom?
  2. What type of Business Freedom do you want?
  3. To get that type of Business Freedom, what needs to change? and then…
  4. How do you do it?

8 Business Pitfalls to Avoid

How can you increase your chances of achieving business success? By winning the lottery or inheriting oodles of money? Whether you are an established entrepreneur or you are just starting out in business you need to realise and accept that there is no quick fire road to success.

However when you take steps to avoid the cracks (pitfalls) in the footpath you stand a better chance of paving your way to business success.

Here are the 8 Pitfalls to Avoid:

  1. Success Breeds Success. Do you think you know everything about business? Have you realised yet that you don’t have all the answers? Become an effective and profitable business by seeking advice from people who have already achieved great success. Let’s face it they have done the legwork. Connect with highly successful achievers and absorb all the experience and knowledge you can.
  2. How Big is your Vision?Did your business start out as a small idea? Has your small idea grown, changed or evolved? How much impact is your small idea making toward to future? Think big from the start. See your business at varied intervals – five, ten, twenty years. Ask yourself – What do I want to achieve and How will I be remembered? Believe in your vision and make it happen.
  3. Who is your Market?Before you rush headlong into your business you must research your market. Never assume that you know who your target audience is or what they want. Assume and you may miss the biggest opportunity of your life. Understand what your market needs and adapt as your business grows.
  4. Don’t Ignore Social Media. Not entered into business battle with social media yet? Admittedly social media is the talk of the town – it’s in the moment, right now. But is it necessary for my business you ask? Quite simply yes. Social media used in a targeted way can be a very effective marketing tool. Learn how to use it and choose what suits you best.
  5. How Do People Get to Know You?Your brand is your reputation. Your brand is your personality. Your brand is what others think of you. What does your brand say? Make sure your brand meets with your standard, your expectation and delivers the identical message and service to each and every client you do business with.
  6. Look after Loyalty.Heard of the 80:20 rule? That 80% of your work comes from 20% of your customers. And who are these customers? Existing, loyal people who have established a long-term, ongoing relationship with your business. Don’t overlook these people and only focus on attracting new customers. Stay in touch with them and show your care and appreciation for their loyalty.
  7. Improve your Business.Ask for feedback. How else can you manage any issues that arise? How can you change if you don’t even know there is a problem? Or do you think that you are doing everything right?Request honest feedback at random intervals or as standard with all new customers. Learn, improve and achieve better results.
  8. Plan your Finances.What is the main reason why most businesses fail? Poor financial planning and negative cash flow. Start your business with a plan, follow your plan, adapt your plan, and watch your business thrive. Manage your money well; over-estimate your expenses and under-estimate your income. Surely you’d rather have more money than not enough?