Saturday, December 29, 2007

Contemplating Existence

This morning my father gave me a 1983 article from Harvard Business Review called, “The five stages of small business growth.” In it, author and accounting professor Neil C. Churchill labels Stage 1 as “Existence.”

In this stage, businesses struggle to stay open. The business owner *is* the business. Existence depends on the owner’s investment of considerable personal energy, direction, capital and time.

The professor continues to explain that at this stage, there are three critical issues for businesses. They are:
  1. attracting enough customers and performing the tasks of the business well enough to be viable

  2. expanding from initial customers to a broader sales base

  3. having enough money to meet the cash demands of the start-up phase

    Both of my businesses—the copywriting one and my new maternity retail store that opened last month—are in Stage 1. With both efforts, I’m attracting customers and succeeding in delivering the services. The question of viability, however, is still up in the air for both entities, as is the consideration of expansion.

    As I distill all of the questions and worries I have about my two fledgling businesses into those three, small-but-significant ingredients, I find some relief from the start-up stress.

    I am confident that I can meet the first two challenges. I believe that both businesses have the capacity for success in their quality, concept, service delivery and in meeting genuine consumer needs. The remaining challenge, according to Professor Churchill, is money. From where I sit, though, there is one more: time. I need time to gain traction and critical mass, as well as enough money to buy the time and the means to gain traction.

    What a relief, then, to know I can access more money (I haven’t yet maxed out credit cards, sought a business loan or tapped my friends and family for cash).

I guess now I must learn to be patient with myself as I learn how to use my time and money to their greatest impact.

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