The World’s Simplest Business

In my last blog I talked about the importance of accepting the hand you’ve been dealt, and playing it well. To illustrate, I told you about  how Neil Warnock had taken my ‘dead and buried’ football team in February, and sent them on a run of eight unbeaten games. Well I’m pleased to report that the run has now extended to eleven games (equalling the club record) and the threat of relegation from the Championship is gone. This was something which most viewed as highly unlikely back in February. So how was it done?

Well we’ve already seen how playing the hand you’ve been dealt is  the key (rather than complaining about it) but exactly how do you play a relatively weak hand? Warnock said something last week that gives a valuable insight and a clear message which transcends football. I don’t have the exact quote, but this was the gist:

“This isn’t rocket science. I see modern coaches with their notebooks saying we do A and then B then C and then D. But they overlook the fact that the players they’re working with can’t do A properly, so there’s no point thinking about B, C and D.”

What he was alluding to is the tendency to over-complicate and to impose a system of play on players who are ill-equipped to carry it off. They have watched Barcelona achieve great success with possession football and assumed that this is the way to win. And Football coaches aren’t the only ones who make this kind of mistake.

Aspiring entrepreneurs look at those at the top of the business game and assume that this is how you have to do it – build slowly and methodically with painstaking preparation and infinite patience. Don’t concern yourself with short term profits, but rather, build something that will yield results over the long haul. Accept losses for several years.

Have you heard of companies predicting they won’t go into profit for 5 years or longer? It’s the equivalent of Barcelona playing 45 passes before arriving in the penalty area. Well that might work for Barcelona because they have the players who can make those passes, and if it breaks down they have the skill and energy to start all over again. But that isn’t going to work for Rotherham United. They don’t have the skills to make it happen. What they need is a more direct route to within range of goal, and when they get there, they need to try to score – fast!  And the more attempts they make, the more goals they’ll score.

It’s the same thing for an aspiring entrepreneur. He or she needs to get within sight of their goal (a profit) as soon as possible. Over-complicate the process with elaborate, extended preparations and they will run out of either resources  or energy before the goal is reached. Playing the long game (as opposed to the long ball) is for the big players with deep pockets and the skills and resources to carry it through. It’s not for the likes of us.

Fortunately, just like football, this doesn’t need to be rocket science. Pay heed to the ‘business models’ of  big companies and you could be excused for thinking that making serious money is beyond the wit and resources of ordinary folk. It all seems so damned complicated, but it doesn’t need to be, because when you pare it right down, all you need to do is…

Buy, create or  make stuff at one price…and find people who will buy it for more.

That’s it!  Strip away all the theory, business-speak and technical mumbo-jumbo and making money in a business need be no more complicated than that…selling stuff for more than it cost you. That might sound old-fashioned (just like Neil Warnock’s approach to football) but it still works,

You can do it  to make a bit of extra money, you can do it to make yourself financially secure, or  you can do it to make yourself a billionaire. And you really don’t need Barcelona level skills to do it.

The latest Sunday Times Rich List,  published this week, shows Chris Dawson at number 57 with a personal fortune of £1.65 Billion. Dawson is an illiterate former market trader who realised early on  that business doesn’t need to rocket science. His market stall evolved into the first The Range store in 1989 and now there are 88 of them. It’s Route One business…buy stuff for one price and sell it for more. Repeat.

I doubt that Dawson spent a lot of time on a complicated strategy when he started out. He had a simple idea and committed to doing that simple thing well. Yes he was limited in some respects, but  that didn’t matter because he focussed on what he could do rather than what he couldn’t. And what he could do isn’t really beyond any of us really… Buy stuff at one price and sell it for more.

When Dawson started out you needed a shop or a stall. Today your market is at your fingertips.

How big an open goal do you want?

3 thoughts on “The World’s Simplest Business

  1. Pete I

    As usual, distilling the apparently complicated into its simplest form!

    I was just wondering about this Barcelona/Rotherham comparison & bending everybody to fit the “Barcelona model”, even if it doesn’t suit them… then suddenly the Government’s recent pledge to make all schools into academies popped into my head. Does Nicola Morgan read this blog, I wonder?

    Keep up the good work John

  2. micheal joyce

    Your straight-forward-description of the straight-forward-approach brings the reader directly to the thrust of the message of seeing the goal and not create obstacles. thank you.

  3. otsai

    Your strategy sound so simple and the approach very straightforward. I’d really like to know more about this business


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