Getting Something for Nothing
Every now and then, someone comes in my office and says they need our services. But they can’t afford them. Hey, not everyone can, but once in a while, I get this one creative person that says they’ll give us a percentage of all future sales in lieu of payment for our services.
2 points for creativity, but… that’s not the best idea.
To date, we’ve refused every request like this. Here’s why.
- They’re sending the message that they haven’t done a business plan and that they really don’t know what they’re doing. If they had done a plan, it would include a marketing strategy and would also include the financial data on how much they will practically need to invest in the first year, and thus gather, before they start their business.
- If they fall flat on their faces, our company is going to take the hit for their lack of planning? I think not.
- If they can’t to go to the bank and ask the bank to invest in the company and take a risk with them, why on earth would anyone else?
- If they just don’t want to go get a loan for the business, what kind of message are they sending about their own faith in the business strategy?
- Last, I wonder if they realize they’re asking us to invest in them – all without a solid and well-thought-out business plan? Would they approach a bank or a VC like this?
I admire the creativity of trying to accomplish X with limited resources. The majority of the world’s new leaders have all made something out of nothing. But not without a plan.
Not every business needs lots of capital to start it, run it, or even market it. There are many, actually, that require very little capital at all. However, a good business and marketing plan done with financials organized long before the business even starts is going to pave the road to success. The entrepreneur knows ahead of time what they’ll need, so they can do what they need to do the right way, the first time.
It’s never too late to do a plan. We have helped dozens of businesses create their plans and craft custom time lines for implementation.
Have you done yours?