What is small business success?

When I look at other small retail, I don't consider a concept proved for at least five years. That is, a store needs to survive five years and still be making money for me to believe they're viable.

But beyond that, I also include a seven year measure for emotional success. If after seven years a store not only makes money, but is emotionally, physically, and mentally satisfying, then I believe they're viable.

Maybe seven years is an unnecessarily high standard. I could conceive of a business which is designed to be in business for only five or seven years, which might consider itself a success.

Nevertheless, I think if a store can make it through the seven year period, it has proved out.

Why the seven year mark?

Because ironically, the very things that might help you make it to the five years mark as a financial success can work against you as a emotional success. To succeed in a small business these days you need to so over work, over invest, and over commit, that success can breed failure.

My guess is that most successful businesses that make it past the seven year mark have found a compromise with financial versus the personal.

To make it through the first five years, I believe a small business has to avoid some common misconceptions.

1.) Being cheaper sells more.

2.) Paid advertising works.

What does work in the first five years?

1.) Working most of the hours yourself.

2.) Self-promoting. Doing all the promotional things you can that don't cost money.

3.) Service, service, service. Don't discount your product, add service to the product. You can't beat the internet or the mass market on price anyway, so you have to provide added value.


So, not doing the first two things and doing the second three things helps make you financially viable.

However, doing the second three things can burn you out over a five to seven year period. I've seen this almost as often as I've seen businesses go out because they weren't making money.

So in order to avoid that burnout, you have to moderate and tailor the services you provide. You have to give up some of the financial success to hire employees, you have to ease off on the constant self--promotion and hope that the business has gained enough credibility to be viable without the constant push.

A business has to either be financially successful or emotionally satisfying -- but not only aren't those the same two things, they can be actively contrary.

I think it's hard for small business owners to recognize the dangers of burnout. Our culture is so go-go all the time, that it seems sinful to ease off. But I think that the more rah rah you are, the more the danger of burnout, which then makes you less effective as a business.

The first five years of business can be exciting and satisfying, and most owners are willing to put in the time, energy, space and money to try to succeed. But it's hard to maintain that level of energy forever. It is possible to take the financial success that results, and find a level that is self-sustainable.

If you can do those two things, then you have succeeded.