Share By Giovanna Fabiano
After nine years at international accounting firm KPMG, Gene Marks decided to try his hand at working for himself.
While it may be a long-held dream for many American workers, Marks makes no bones about it – there’s nothing “romantic” about owning your own business, especially at first. It took years of hard work and sacrifice, but his struggle paid off. Since launching The Marks Group PC — specializing in customer management and other business software —in 1994, his company has grown to more than ten employees and serves 600 active clients across the country.
In 2005, Marks began writing about his experiences as a small business owner, “purely for therapeutic reasons,” he says. But his practical advice and down to earth attitude resonated with readers. He’s now a best-selling author and “guru” of sorts for the small business owner, sharing his tips in daily columns for The New York Times and weekly in Inc., Entrepreneur, Forbes, The Huffington Post, Philadelphia Magazine and Fox Business.
Marks recently talked to Real Business about what aspiring small businesses owners need to know, those pesky mistakes that drive customers away (hint: don’t impose minimum purchase fees for credit cards) and why this is the best time for startups.
What do aspiring business owners need to know before they begin?
You really need two things: capital, and complete approval and blessing from your family. If you have those two things, you can survive. Seventy-five percent of startups fail within the first five years.
People need to understand that it’s a combination of money and time. When I started my company, I had some money to help pay the bills, but you’ve got to have buy-in from your family. There are a lot of successful entrepreneurs that have been married two or three times. If you don’t value your family enough or they’re not buying in, you won’t succeed at both. I have a wife and three kids, and before I got started, we talked about it a long time. My wife was 100 percent behind me. It’s hard work, but I had no control of my life when I was working for others. My wife said, “If this is a way we can keep balance and have control, I’m 100 percent behind you doing this.”
What are some of the biggest mistakes you see small business owners making repeatedly?
I see too much planning and analysis and a little less doing. If you want to expand, do it slowly and grow at a pace you’re comfortable with — you don’t have to be master of the universe.
I think too many people romanticize being a business owner.
When someone calls themselves an entrepreneur, I cringe. There are big investors and there are small business owners. I spend my life collecting money, writing payroll checks and not ever feeling like I have enough money. Everybody has what they’re good at. Entrepreneurs are good at investing. Some people are good at sales and marketing. People don’t recognize their own limitations. Figure out what your strengths are and delegate the rest.
Is the customer always right? How do you balance earning profits and keeping customers happy?
You have to choose your battles. The customer is not always right, but you can’t tell them that. When you have a customer that just won’t take no for an answer or makes unreasonable requests, don’t argue with them. I’m responsible for telling them what I would do in this situation, like a dad talking to a teenager, and as long as you advise them, it’s up to them. I hate when people say, “Fire customers.” Don’t fire them. Let them choose to fire you.
You as the business owner also don’t want to make stupid mistakes that end up costing you customers. When businesses don’t accept credit cards or have these minimum fees, you and I are inconvenienced. I don’t have the cash so I’m just going to go elsewhere. They’re trying to save a dollar and they end up costing themselves a hundred dollars because they’re losing a customer.
What are some of the biggest challenges facing aspiring small business owners today?
I’m a believer that there really are no significant external challenges for a startup today. There’s never been a better time to start a small business because you can start it for next to nothing.
Technology is such that you can start anything from your own home. It requires less capital and there are more resources: outsourcing, crowdfunding, SBA (U.S. Small Business Administration) loans, etcetera.
The challenge is internal. It’s the challenge of being an American in 2014 and being willing to sacrifice, move to a place with lower rent, not going out to Bennigans … would you be willing to give that up?
So what’s the takeaway for someone who wants to start a business?
The idea doesn’t have be that great — you have to be great. There are a million plumbers out there, but that doesn’t mean you shouldn’t start your own plumbing business if you’re better than the rest. Do you have the testicular fortitude to go out and be the best plumber out there?
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