How Micro Entrepreneurs Make Mega Profits

Many of the readers of this Journal are self-employed. Perhaps you left the corporate world to open your own business. If so, you’re part of the amazing group of talented and courageous people I work with each day. Do you believe your business can be the tool that gives you the lifestyle you dream about?

The problem I see over and over is that most small business owners don’t acknowledge their greatness or their potential to create what they want. It’s downright frustrating to see so much talent overshadowed by the endless day-to-day operational grind. These competent people don’t go for the dream because they might not reach it. One of the reasons so many businesses fail is that the owner never makes the transition from self-employed to entrepreneur.

The word “entrepreneur” is bandied about freely these days, but it takes a certain mind-set to truly become one. While the self-employed are very good at what they do, they often find one or two ways to keep the client pipeline circulating and once they’re comfortably profitable they settle into a groove and tend to stay there. That’s fine if you’re looking for a glorified job, but not if you’re building something to last and provide you with the lifestyle you want. The self-employed individual often wakes up one day to find that the business world, which changes with lightening speed, has left her behind.

On the other hand, the entrepreneur is a highly creative person with an understanding of the importance of creating multiple profit centers in her business. Notice that I said profit, not revenue. An entrepreneur thinks profit. Unlike the self-employed, who build their business on a “vertical” model—several key products or services marketed in the same ways—the entrepreneur builds a business on a “horizontal’ model.

The horizontal model reaches beyond the horizon to see all the possible profit centers and streams of income that could be developed around the key business niche. This includes looking at areas such as:

• increasing Web site profitability
• maximizing the Web site’s ability to attract prospects
• developing a formal, systematized referral program
• developing and implementing an ROI marketing plan
• measuring, tracking and analyzing marketing and customer satisfaction results
• looking for potentially lucrative joint venture opportunities
• planning second and third generation products to increase repeat business
• owning a piece of other small companies that serve the same target client
• paying close attention to trends, trends, trends
• building visibility and expert status

The entrepreneur has a strong, detailed written plan that clearly spells out how much profit can be expected from each income stream and how to attract clients to that income stream. This plan sets the overall strategy and powerful intention for your business.

99% of the hundreds of small business owners I’ve worked with or who have attended my tele-classes don’t have written plans. I know how hard it is to find time to research and thoughtfully create a financial or marketing plan when you’re fulfilling many roles, because I didn’t do it either when I owned my first business. But if you reserve just twenty quiet minutes a day for planning, in a few months your plans will be completed and you will have much more control over the growth of your business.

Entrepreneurs never settle for comfort. They’re always on the lookout for new opportunities and they keep abreast of emerging trends. Entrepreneurs are passionate, not only about what they do, but about the “game” of business. They have fun. If you want to build an entrepreneurial mind-set, you must be willing to try new, cutting-edge ideas and have the courage to learn from the ones that fail. Most mega-entrepreneurs I know failed miserably at some point; some even faced bankruptcy. You’ve probably heard this before and are hoping you never have to face failure. If you don’t try to pursue new profit centers and marketing ideas, and develop new products or services, you may never face it. But you will severely limit your business growth and your ability to live a life where you have time to give back to your community, spend plenty of quality time with your family, and create financial freedom for the future.

Start thinking like an entrepreneur! Why not start planning to double your profits in 2006? Map out the potential profit centers for your business. Create several new income streams and start thinking bigger.

In a recent class I took with Michael Gerber, entrepreneurial guru and author of the huge best seller, The E-Myth Revisited*, he said that to be a successful entrepreneur you must be “obsessed, purposeful, and have extreme clarity.” Form an intention that meets these criteria and it will generate the energy and forward momentum you need to reach it.

*Gerber, Michael E. The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It. New York: Collins, 1995.