10 Nonnegotiable Tips for New Entrepreneurs

So, you’ve decided to make the leap to owning or starting your own graphics and sign business. Congratulations! We need more energetic and brave entrepreneurs; they drive our economy, trade, and industry. Free market capitalism is a cornerstone of our country through private ownership of goods and services distributed to consumers for profit.

That is, unfortunately, the easy part. Getting it done … well, not so much!

After opening several businesses from scratch and buying three, I have concluded that there are 10 nonnegotiable tips that will help you get on the long road to building a profitable, scalable, and most importantly, a sellable business. You can take shortcuts but be prepared for a long haul of hard work, dedication, and keeping your eye on the prize. Perseverance is a key player in your arc of success.

1. Assess your passions and skill set

Undoubtedly, you are ingrained with certain skills, traits, and advantages through genetics, training, education, and experience. Write down all the traits that you think are part of your makeup. Ask your best friend, significant other, and/or a mentor for their list of the key attributes they observe in you. Be sure to add several personality profiling, career/interest aptitude, and how-you-learn-best tests. There are many great ones online and most are available for free.

The answers that come from these tests and lists are the things that come easy to you and make you unique. These are often the fire — sometimes passions — you do not have to work on, improve, or alter. They are often driving forces that will propel your firm forward. These may include an affinity for sales, marketing, fixing things, project management, finding connections in relationships, writing, or being a visionary.

Being great at numbers and accounting is a real plus. A key one is seeing things from a 30,000-foot view. Refer to these skills often and find people that compliment your skill set and have the talents and traits you are missing. That is your daily homework; you will need to constantly work on solving this equation during the life of your business.

2. Invest in personal development and EQ

One of the greatest investments (besides braces or a retainer) for your personal improvement that will guide you on your life’s journey is personal development. Most well-known entrepreneurs who have created and/or lead organizations have credited much of their self-discovery through reading self-help books, attending motivational seminars, listening to inspirational books on tape, and discovering the biographies of leaders they want to emulate.

Self-improvement is a lifelong commitment, and the real return on investment of time, effort, and media aids is significant. We are all motivated by different things and finding your key psychological triggers will propel you forward. A key component of self-improvement is emotional quotient (EQ). There are numerous books and seminars on EQ. This part of your journey will be about self-awareness, empathy, interacting with people, learning body language and its subtle cues, and of course, listening intently.

A few people are born with EQ, but it can be learned if you are coachable and understand the importance of interpersonal relationships and their impact on your business. You will be interviewing strangers, managing vendor relationships, nurturing people, growing a customer base, dealing with financial institutions, etc. EQ will help you bridge the gap between learning about yourself and others.

3. Find a mentor

A mentor is a coach that could be a friend, a family member, a vendor, or even a competitor. Finding a person with whom you can share your doubts, plans, goals, dreams, and everyday challenges with is not an easy task. But take the time to seek one out. The dividends a mentor will provide you with on your new journey are priceless.

It is important for a mentor to be honest with you so selecting one in your industry is an obvious choice if possible. I have had multiple mentors in my life; some were spiritual, others were vendors whose successful brands and operational efficiency I wanted my firm to mirror, and one was a CPA that helped businesses obtain financing. My high school basketball coach was my first mentor; his mentor was John Wooden, the great University of California at Los Angeles coach. Both coaches were mentors to hundreds and changed the lives of most.

A mentor invests their valuable time and energies in you so make them a priority. Be respectful of their input. Someday, you will be asked to be a mentor for a special person and pay it forward.

4. Make sure you are over-capitalized

If you are buying or starting a new business, hopefully you have read or learned that under-capitalization is a leading cause of failure. If you have done your due diligence and created a winning business plan, you have determined the rough capital needs to start the operation or close on the sale. If you are buying an existing business, do not let the multiple years of financials fool you; there will always be things that happen beyond your control. As I learned in Cub Scouts, “be prepared.”

Most entrepreneurs tend to underestimate the cost of operating their new venture. A good rule of thumb is whatever the number you think is the most it can be, make sure you double it. There are always hidden costs you will not know going in and cash flow can make or break you. If sales (which are critical) are the lifeblood of a business, cash flow is the oxygen. Cash reserves are the red blood cells that can come to the rescue. I recommend you do a cash flow analysis before you begin if possible. And find a quality CPA firm that can help you prepare financials, tax returns, and analyze your cash needs.

Your next challenge is finding a funding source like a bank, partner, equity group, or other venture capital firm that can help you start and later grow. If a bank is top of the list, interview them and find one that is financially sound, known for helping small businesses, and has convenient branches for your banking needs. If you have trouble finding a bank, ask around and also check with your mentor.

Networking will often be the solution. I found our future financial partner because I went to Rotary Club with a banker who had similar values as me and he had a servant leader approach (as did his entire staff.) Years later, that bank was instrumental in our growth and building/land acquisition. Today, I still bank with them, and they hold a good portion of our cash assets and are close friends as a bonus. Never underestimate the power of networking and relationships!

5. Find your unique value proposition

When you select the signage and graphics industry, you are not curing cancer or finding ways to harness hydrogen fusion. While you may invent and even patent an idea that revolutionizes our branding world, the chances are you will be providing basic goods and services with similar competitors. Whether it is wide-format printing, vehicle wraps, decorative apparel, imprinted promotional products, signs, graphics, installation, or service, what will set you apart from the small and large firms in the marketplace?

A true entrepreneur must discern their unique value (or selling) proposition (UVP) and create a statement that is concise about the benefits you offer customers. It is simply an explanation of what makes your enterprise different. It is not a slogan, tagline, or positioning statement. Instead, it describes your value, to whom you are targeting and providing that value, and the “why” and/or “how.” This exercise includes the following challenges:

• Identify your target market
• Define what makes you unique
• Recognize the specific problem(s) your products/services solve
• Contemplate what you stand for as a business

Make sure your UVP fits the image you have created for your brand. It should sound like the UVP comes from the brand’s “voice.” This involves research and a clear understanding of your brand and what you can provide your audience. This is a trial-and-error exercise and sometimes, it evolves over time.

We are in the branding business. We help our customers express their brands with our curated selection of products and services. Once you learn how to do your own UVP, it is much easier to collaborate with your clients to find the perfect solutions you provide that help them gain more sales, customers, and profits.

6. Learn how to interview effectively

In today’s post-COVID economic climate, finding talented people to be part of your organization is a unique challenge. Our narrow industry is unknown to most potential workers so do not be afraid to court candidates from the local junior college and university. Once you have serious job openings and interviews set up, be prepared. Learning how to be a great interviewer is going to be a big part of your success because without a team, growth is tough if it is only you at the helm doing everything.

There are many online video tutorials for conducting job interviews. Greatness comes through dedicated practice (ask any Olympic gold medalist). There are some basics that helped us select good people and some of these superstars still work with us today after two acquisitions. Some ideas and practices are obvious, but these are the top ones:

• Get familiar with the job posting that describes your expectations, the job’s responsibilities, and qualifications
• It is amazing what a job candidate might post on social media, so check it out in advance
• Provide a comfortable and nonthreatening interview environment where the candidate feels at ease
• A firm and confident handshake tells a lot about a potential coworker.
• Did they get up to greet you or remain seated?
• Study the applicant’s resume, cover letter, application and get them to elaborate on their work experience, any gaps and why they think your job is a good fit for them

If you have other employees, encourage them to also interview the subject briefly. They will have to work with this individual and what your existing team may glean may vary from your impressions. We called it “the gauntlet” and it was accurate in predicting a good fit.

Throw in unexpected questions like “what do you do for fun?” One of my favorites is “What did you do when you were young that got you into trouble?” Or “What things have you done in your life that you are most proud of — or regret?”

Answer their questions honestly and completely. Kudos to those who come prepared with valid questions for you; that shows they are eager.

Give the candidate a personality profile or aptitude test if relevant. During the interview listen carefully. Notice their body language and learn nonverbal cues like facial expressions and attire. Eye contact is a big plus and shows confidence.

Follow up with every applicant when you say you will. That is courteous and professional, and it says everything about you as a business owner. Celebrate those individuals that you hire and introduce them to the team. It is a big deal when you bring on a new member to your organization — and payroll.

7. Network often and build relationships

Networking in our industry is a prerequisite to generating sales, longevity, profits, growth, and value. Join civic organizations that are meaningful to your core values. Serve on regional, state, or national sign industry boards. Be active in your industry; not only will you find friends for life, but you will also find additional work, partnerships, referrals, and fulfillment as a volunteer.

Offer to do an Introductory Sign Business Day for your local schools and universities. Educating the public about our vocation will often bring you customers and prospective employees in the future.

Invest time in your vendors. They will help you grow your business because they want to learn what your specific needs are in your market. You cannot be a great customer solution if you lack committed vendor relationships.

Someday, one of your vendors may be extremely instrumental in helping you sell your business. And that important transaction will be on your mind for the balance of your life.

8. Plan strategically and do it every year

Strategic planning is a regimented process of defining your business strategy that governs your firm’s direction. It is the best way to clarify your vision and mission, plan for resource and capacity needs, optimize operations and ensure all stakeholders are aligned with corporate goals.

Involve all or at least your key employees. Identify how you match up against the competition by using the SWOT analysis tool (strengths, weaknesses, opportunities, and threats.) This type of planning requires you and the team to be proactive and address issues for a more long-term view.

It involves integrating all departments: accounting, sales, marketing, human resources, fabrication, installation, and others. You will want to establish specific goals and targets to implement the strategies you identify.

Evaluation of your fruits of strategic planning includes review of internal and external factors affecting implementation of your plan, measuring performance, and taking corrective steps to make the strategy more effective. Throughout the year, you must be open to checking and adjusting as forces or situations dictate.

9. Embrace change and the entrepreneur journey

Change in life is inevitable, and most people are not comfortable with change. Being an effective entrepreneur is about adaptation and learning that change is okay. Think of this journey as a sort of train trip.

This theory has altered the course of my life as a business owner and leader. There are three main stations you encounter on your journey of the train track. The first is survival. This is when you start your business, and your chief motivation is hanging on by your fingernails as you navigate the surroundings of your new endeavor. Hopefully, you have followed these first nine tips as closely as possible. But this survival mode (the first five years) is all about staying in business, making a profit, and getting to the next station. It is basically rinse and repeat, rinse and repeat, so that running the business becomes instinctual and automatic.

The second stop on your journey is success. In this phase, you enjoy the fruits of your hard work, long hours, and perseverance. You learn at this junction about working on your business and not in your business. You have key, loyal people that are well-trained, who think like you and help you achieve each year’s strategic goals. You take vacations occasionally!

Profit increases as you work on the business, and you implement creative efficiencies. Sales start to soar as you become more well known. Your networking is paying off in big ways. You are growing your brand and the value of your organization through equipment and people investment.

The last station is significance. This is not really a destination; the journey runs in both directions unfortunately. In fact, you can get to station two or three and sometimes go backward. This happened to us in the Great Recession. Those were ugly years. We lost ground and over $1.3 million in annual sales and had to claw our way out of the basement. But we hung in there, got creative, and learned that you can survive anything if you work hard enough.

If you are lucky and humbled enough to get to significance, you learn that position is where you can make a difference. You learn that life is about relevance and self-actualization. That varies by each person, but it might mean being able to donate money, leave a legacy, make special investments, anonymously help people, and do the things you only dreamed of at station one or two.

When you get to significance, you can help change the world in a small or even meaningful way. You begin to take your eyes off yourself and focus on something greater than you. The why becomes more important than how.

10. Make each major decision thinking of the day you sell your business

You will make thousands of decisions during the time you own a firm. Minor to major decisions will impact the fate of your company. Some will be instantaneous, many instinctual, and most choices will be carefully considered. But the day you look at each major decision through the lens of selling your business, you will rethink your decision methodology.

These were a few of the questions that changed how we made critical decisions: Will this equipment investment help me sell my business for more money? If I buy (rather than lease) a building and land, will it make my company more valuable and easier for a buyer to finance? Do I carry too many people on payroll because it is easier and less work for everyone? Do I reduce my debt now or later? Do I buy a competitor to eliminate the competition and increase my asset base? Do I sell my unused equipment to make room for another income-generating opportunity?

Get into this mindset early. It will generate a massive return on your investment as you rethink how you make any business decision. Our CPA mentor gave us this advice and it was an epiphany moment that still reverberates six years later and led to our successful acquisition at a key moment.

Congratulations on your new endeavor. Do your best to follow these tips and learn everything you can about being a great entrepreneur. Good luck, Godspeed, and fasten your seatbelt for the ride of your life!