Speaking to local business owners for the past 18 months or more I have pretty much reached the conclusion that we are being incredibly wasteful with talent and resources in individually trying to launch and sustain businesses.

Almost every networking event you go to brings another fresh crop of “edgy new digital marketing agencies”, IFAs, printers and so forth.  All setting out to boldly go and learning on the job – whilst those that have been in business for a dozen or more years nod sagely in the background knowing that they are likely to be a part of the 90% of start-ups that fail.

The corollary to this perhaps is the “established” firm that has made a bit of profit and won repeat business for more than 5 years but remains on the hairy edge of insolvency having ridden their initial luck and now run out of ideas, expertise and capital.

Meanwhile, there is an abundance of talented people who have been made redundant through no fault of their own sat at home clicking through  job sites, pestering their in-work mates for leads and referrals and gradually coming to the realisation that “jobs aren’t coming back” in their old industry – or they’ve suddenly become “too old” but no-one is allowed to tell them.

Next, we have the companies that are doing alright or better.  Hunkered down against the onslaught of all of these annoying service and product providers that are desperately trying to catch their eye and their wallet so that they can help them and in doing so, help themselves to either stay in business or make a start toward profitability.  Many of these firms could REALLY use the products and services that are “out there” but they are scared about spending money or making a bad purchasing decision and possibly losing their “safe, secure, job-for-life” – especially in the public sector!

Compound these dynamics with a shortage of credit from scared (and insolvent) banks and “once bitten” investors with their hands firmly jammed into their pockets and the ludicrous procurement and hiring processes that have grown up under “new Labour” and you have a recipe for continued disaster – a slow motion car crash.

So what can we do to resolve this log jam or perfect storm?  Here’s my take on it:

1. Remove the HR and Purchasing blocks from companies to make it easier for suppliers and potential employees to get in touch;
2. Open up online and allow prospective sellers to contact you and your company – the opportunity cost of doing otherwise is clear;
3. Collaborate locally – there’s no sense in 20 great designers each trying to cut each other’s throat when they could work together;
4. Sack the Chambers of Commerce and other membership organizations that won’t refer and put people together;
5. Develop affiliate marketing between complementary businesses and refer and endorse each other to existing customers;
6. Work for nothing – put some sweat equity and expertise into helping someone – ideally that may have a better chance of success than you.

All of this of course seems to go against what we’ve been taught about the noble entrepreneur and by the competitive world in which we’ve grown up – you snooze, you lose; survival of the fittest and all of that.  But if you look carefully you’ll see that all of the successful entrepreneurs know the essential importance of leveraging:

• Other People’s Time (OPT);
• OtherPeople’s Money (OPM)
• Other People’s Expertise (OPE)

The key is to cut a deal that allows you to be paid later for efforts invested now – and that can be a simple written agreement – it doesn’t need to have a legal eye cast over it.

Unless entrepreneurs and struggling businesses work together and pool their OPT, OPE and OPM (as well as their collective resources) we will continue to struggle in the battle against this recession, wasting scarce resources over and over again as we try to sell things that people neither want nor can afford.  Just take a look at the wasted promotional printing at your next networking event – barking.

We need to seek out the pain that people are feeling and provide accessible solutions that remove it – that’s how I think we need to proceed.

Any takers?  Drop me a line here or on Twitter@Veterus.

Yours in business,

Brad