Today, I spoke to Diane Kennedy, who is the co-author of Smart Business Stupid Business, and her previous books have been on the Wall Street Journal and BusinessWeek best-selling lists. In this interview, Diane talks about the difference between a smart and a stupid business, mistakes that people make with personal branding, how to leverage a personal brand to create a company, and more.
What are the clues that tell you that you have a smart business or a stupid business?
The easiest way to tell whether a business is a smart business or a stupid business is simply by applying the test of time. Is the business still around?
A stupid business is average. It’s out of business in less than 5 years. That’s the national average.
A smart business is a business that was started with the end in mind. There is cash flow when it’s needed and the business continues to build value. The owner has an exit strategy and there are systems in place to allow the business to grow beyond the owner. The business makes money and so does the owner.
What are some of the mistakes people with a powerful personal brand make when building their business?
A business owner with a powerful personal brand often struggles with creating an identity for the business that is separate from himself. The business becomes so entrenched with who he is and what he does that he can’t let go and allow it to grow. In this case, the business owner can be the biggest challenge to the future of the company.
The solution is identifying the ‘why’, ‘what’ and ‘how’ of the business by clearly defining vision, mission and values for the company. Then design and implement systems with the right people on board to grow the company. In this way, the brand of the company complements and grows with the personal brand of the owner.
What is one way to effectively leverage a personal brand when building a company?
A strong personal brand is identifiable. Customers know what to expect and the business owner can build on that expectation to fulfill their needs and wants.
Once a business owner identifies what her business really means and what solution she provides for her customers, she can find additional products and services that complement what her business already does.
- What other services do my clients need?
- What prospects don’t buy from me?
- How can I refer them somewhere else for help?
Understanding the business’s brand and its customer needs means that the business can create multiple streams of income to create more revenue and diversification. That’s a great hedge against a volatile marketplace.
What’s the biggest risk to business owners today?
Between the economy, changing laws and financially-strapped state and federal governments, there is a lot for a business owner to watch.
But the biggest risk is not from any one of those things. The biggest risk to a business is not noticing them. A smart business today needs to be able to adapt and flow. Markets are changing and expanding. Technology provides more options and bigger risk. And through it all, the tax laws are dramatically changing.
It’s important to know what’s going on. Business owners need to keep up with current events and how the business could be affected.
What does the future look like for the small business owner?
In a word: change. The better and quicker a business owner, and a business, can adapt, the better. That means staying current, understanding the market and branding and quickly identifying business trends to correct and expand.
It’s an exciting time to be a business owner and it’s a challenging time as well.
Diane Kennedy, CPA is the co-author of “Smart Business Stupid Business.” She has two Wall Street Journal and BusinessWeek best-selling books. Diane is a practicing CPA with five virtual offices located across the country. She has a number of very active websites with fans around the country. Diane is featured as a tax expert on educational products within Trump University and Robert Kiyosaki’s programs including Rich Dad’s Choose to Be Rich program that has sold hundreds of thousands of copies. Some of Diane’s current book titles include – Loopholes of the Rich, The Insider’s Guide to Making Money in Real Estate, The Insider’s Guide to Real Estate Investing Loopholes, The Insider’s Guide to Tax-Free Real Estate Investing and Tax Loopholes for eBay Sellers. Diane draws on her 25+ years of experience as an advisor to some of the nation’s wealthiest business owners and investors to outline, step by step, the strategies and approaches that the rich use to build smart businesses as they pay the least amount of tax legally possible.Find out more about nexus and other critical business topics to make your business smarter! You can find Diane at USTaxAid.com and via twitter @DianeKennedyCPA.