I have recently coined a new phrase (or in my mind, a ‘syndrome’) that is afflicting business owners everywhere. I am calling it “cottage industry thinking’ and it is rampaging through businesses leaving a trail of havoc in its wake.
Before I go any further, here’s an excerpt of a definition of 'cottage industry' from Investopedia:
“A cottage industry is a small-scale, decentralized….business often operated out of a home rather than a purpose-built facility. ... They often focus on the production of labor-intensive goods but face a significant disadvantage when competing with … manufacturers that mass-produce goods.”
So by definition, cottage industry businesses are small, haven’t been scaled, are labour intensive and depend on one or a small group of people, without which the enterprise wouldn’t continue.
So back to this new syndrome and how it could possibly be affecting you or someone you know. Some of the symptoms to look out for include:
• A deep certainty by the owner that only they can do everything;
• A stated desire for more freedom, less work days, and the utopia of ‘passive income’;
• A refusal to outsource, invest in development or employ others until the business has ‘made it’; and
• A firm belief by the owner that they can ‘build’ their aspirational vision from bottom up, chipping away a piece at a time, with no clear destination in sight.
So why is this an issue?
First, let me be clear. This is not a judgment on how big or small you want your business to be. If you want to rock a small business – fantastic. If you have visions of world domination – great.
But here’s the thing. No matter which of these options you aspire to (or even something in between), a simple fact remains – if you don’t get the basics right you will never be successful.
Unless that is, your definition of success is a business that is entirely dependent on you, relies on one-off sales for income, is dependent on a very narrow client base, and has no clear path to the next new client.
I’m going to go ahead and say it: no-one actually wants a business like this. This is where you stress about money, feel exhausted, lose confidence, see no results, and wonder why you did this to begin with.
So if this sounds like you or someone you know, why is it happening and what can you do about it?
Quite simply, these are all symptoms of having:
• No clear vision (think of this as your destination);
• No plan to get there (your map); and
• A belief that doing everything yourself is the cheapest, most efficient, and most controllable way to build your business to a point where you can then get expert help, invest in
yourself, and outsource (it never happens).
As an example, I had a client who said their hope for the business was that it would generate enough passive income for them to have financial freedom, travel the world and live a flexible lifestyle.
And herein lies the issue – ‘hoping’ is not enough. While those aspirations are fantastic (and certainly achievable), they can only be realised with the right strategy in place; with structured, time-bound and measurable goals; and with a clearly delineated plan of attack to inform the decisions you are making NOW.
Without those things, you have a situation that plays out something like this:
1. The business owner has a dream – not a clear vision or destination.
2. Because there is no clear vision, there is also no clarity on what needs to happen (goals) to make the dream a reality.
3. With neither a vision nor goals, there is no clear path to achieving the dream.
Because all these things are lacking, the business owner has no filter for the many ideas, opportunities or decisions that come their way – so they never know how to assess whether something is an amazing opportunity or at best, a distraction.
The result? Their dream will never be achieved, because their focus is on putting one foot in front of the other, and reacting to whatever adhoc task or distraction comes along.
Now let’s consider a different example. A client who is absolutely clear on what they do and don’t want their business to be, and what success looks like for them.
In this case, they are very clear they want to be a sole operator. They are very clear that they want a finite amount of premium clients. They are very clear on what income level will mean success for them.
This clarity means that the business owner is very clear on the type of clients they want to attract, on their pricing model and on their branding.
There is a strategy, clear goals and a plan to achieve them.
If the opposite were true, this client would be taking on any work that came along, discounting prices and chasing work that they hated, for lack of a filter to test their decisions and activity against, and remind them that their strategy was to be a premium, service provider not a volume play.
Comparing these two examples, business owner ‘A’ believes it will ‘just happen’ organically - "only 'big' businesses need a strategy or vision!" But here’s the thing. ‘Big’ businesses become big because they have a vision, goals and a plan.
Business owner ‘B’ has the opposite approach. They clearly defined what they did and didn’t want at the outset, and that vision then informed everything else. Now the business is exactly where they want it to be – taking small steps and growing organically, but with a clear plan and destination in place. If and when that destination changes, they simply just repeat the process.
This is one of the most profound differences between businesses that achieve success and those that don’t.
Those that have achieved success have defined their destination and use this vision to guide them and filter out the noise.
It doesn’t matter if you define success as earning $10,000 a year from a side business or intend to make millions from a global enterprise. If you don’t have a clear vision, clearly defined (and measurable) goals and a plan to achieve them, you will be forever destined to frustration, disappointment and the status quo.
In this context, I’ve defined some of the symptoms of ‘cottage industry thinking’ as believing you don’t need a vision, strategy or plan, not investing in your skills, insisting on doing everything yourself, and just reacting to whatever gets thrown your way. If you suffer from any of these, it will mean that even though you may be a business owner, you actually just have a job - not a business that will create you more time, freedom and independence.
Need more help? I’ve got your back!
· Do you need to re-set your thinking from ‘CIT’ to that of a successful entrepreneur?
· Do you suspect that whilst you have dream, you really have no idea how it will become a reality?
· Are you consumed by day to day activities, losing your spark and your connection to your greater cause?
If you love the thought of confidently achieving a clear business vision and are ready to clear the fog then book in for a free Discovery Session here : https://BookAnAppointmentWithAlex.as.me/DiscoveryCall