The words law and entrepreneurship don’t even seem like they belong in the same sentence.
One word represents the free-will to pursue the ambitions within your mind. The other word represents rules you must abide by in order to not get yourself in any trouble.
But yet, there are laws that govern entrepreneurship and you need to know them if you want to be a successful entrepreneur.
The laws I’m talking about aren’t taxes you must pay and the licenses required to legally operate your business.
I’m talking about the laws that put you in the position to make more money!
You might be passionate about helping your customers or finding solutions to social problems, but at the end of the day your time is valuable. You must be getting paid for the time commitment you put into producing a valuable product or service.
This sounds like common sense but you would be surprised to know how many entrepreneurs are basically giving their value away for little to nothing.
I call these type of individuals starving entrepreneurs. They’re like the starving artist who play their music for free because they “enjoy” they’re craft.
You can’t be one of these people and I won’t allow you to become this type of entrepreneur.
Passion doesn’t put food on your table unless that passion is being packaged as a business.
And unfortunately, too many entrepreneurs don’t know how to position their entrepreneurial venture as a real business so they’re really just operating a time sucking hobby.
A real business pays you and a time sucking hobby stresses you out because you’re desperate to make money.
But if you were abiding by the rules that govern entrepreneurship, you wouldn’t find yourself in a never-ending losing position.
This is why I want to teach you about the laws that govern entrepreneurship.
Once you understand the importance of these laws, you’ll start to operate in a more effective manner because you’ll know how to strategically work towards reaching your goals.
And what’s great about these laws is that they’re common sense considering the end-goal of entrepreneurship is to build a successful business.
Let’s start examining these laws so that you can improve your daily performance to produce better results.
Supply a Demand (Need)
This seems stupid to even cover but remember that word passion?
Many entrepreneurs confuse their passion with a real business opportunity.
Just because you feel strongly about a particular thing, it doesn’t mean that same enthusiasm is shared by a market of customers.
Your offer is only validated as being feasible when your target market indicates a strong desire to purchase it.
If this doesn’t occur with your product or service then you need to strongly consider changing it before investing time and money into trying to attract customers.
The best way to supply a demand is by understanding the problems occurring in the marketplace.
What’s great is that there are hundreds of existing problems around you that are waiting for someone to create a solution for them.
When you supply the needed solution, you create demand.
Demand is such a great word because it means that there are large numbers of people who will pay you for the product or service that you offer.
But demand is created from a need that has to be satisfied.
This is why it’s very important for you to put the needs of your target audience before your own self interest.
You’re not going to be able to pay yourself a salary without having customers to provide your business with revenue.
Therefore, if you don’t have a real customer base, you don’t have a real business.
Find a problem, supply that demand, earn money, and grow your business.
Sales is King but Focus on Profit
As an entrepreneur, if you’re no selling then you’re not eating.
This fact should be a known by all entrepreneurs but the real focus needs to be on making a profit through each sale.
A lot of businesses are making sales but losing money on each one those sales.
The reason this occurs is due to various problems.
These include: high expenses, low pricing, and high customer acquisition costs.
The biggest culprit for most entrepreneurs is selling at a low price point.
Never ever sell your product or service at a dirt cheap price just to attract customers!
If that’s the case, you might as well give it away for free to attract early users who can be converted into premium customers.
For each sale that you make, there needs to be money left over after expenses that can either be reinvested back into your business or saved to counter unforeseen events that disrupt your business operations.
If you’re constantly selling out of your product but always strapped for cash, you need to increase your pricing.
Sure, you’ll lose some customers when doing this but the customers you keep won’t have a problem with paying premium prices for a premium solution.
All money is not good money and every sale doesn’t actually bring money into your business.
When you focus on profits, your business is strengthened and grows, rather than it being inflated by bad sales.
Great Marketing Facilitates Sales
So far we’ve covered demand and sales but these two things don’t occur without having a great marketing strategy.
Marketing is the process of bringing awareness about your business’s offer to your target market.
Your target market is constantly being bombarded with marketing messages throughout the day. If you’re not communicating effectively with them then your business has no chance at succeeding.
The thing about marketing is that it needs to be focused on informing and educating, rather than forcing the sale.
Even though marketing is about initiating the sales process, people hate being sold to.
It sounds like a contradiction but we live in a world full of contradictions.
Use Apple as an example of how effective marketing works.
They make their customers feel like they’re a part of an exclusive community that everyone wants to join.
Exclusivity is a great marketing tool that you can utilize for your business to attract customers who are enthusiastic about paying for your product or service.
But if you choose to ignore marketing all together, you can be sure that your target audience will ignore your business.
Don’t think that just because you’re open for business people will suddenly find you to offer you their money.
If you don’t participate in marketing then you’ll find yourself ceasing your business operations in less than a year.
Authority Status Produces Big Opportunities
Opportunity comes to those who put themselves in the position to attract it.
The best way to attract opportunities as an entrepreneur is by developing your authority status.
Being an authority means that you have deep knowledge about your industry and can help others produce successful results through your products or services.
You’ll notice that those with authority status are receiving all of the recognition and big opportunities that you want for yourself.
This happens because they created the assets that built their value with their target audience.
These assets include: blogs, e-books, books, webinars, and other thought leadership tools.
The more knowledge you provide to your audience, they start to recognize your expertise and identify you as an authority others must follow.
When you gain this status, your followers will push people to you instead of you having to constantly spend the majority of your time trying to grow your audience.
Start creating your thought leadership assets today so that you can start building your authority status.
This won’t be a quick process but if you are consistent for 3-6 months, you’ll start to experience results that can be further developed into big opportunities within a year or two.
Entrepreneurship is a system of actions that you have to connect together to produce big results.
Knowing the laws that govern entrepreneurship will help you significantly increase your probability of success.
You’ll understand how to structure your operations to produce results, rather than only wasting your time and ceasing your business before even operating for a full year.
If you want to learn how to make 2018 a successful year, read the following articles:
I also encourage you to download the e-book The Starter Playbook for Entrepreneurs.
You’ll need to gain as much knowledge as possible that you can apply to your own entrepreneurial journey.