Overnight Success Strategy

What if you hit it big right out of the gate? This 10-step plan will help you think fast when you rocket to success.

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By Rosalind Resnick

Opinions expressed by Entrepreneur contributors are their own.

You'd think that getting discovered by Walmart or Oprahwould be every small-business owner's dream come true. Yet, toooften, overnight success can quickly become a company's worstnightmare. A small business that lacks the capital, staff orinfrastructure to handle a big order or nationwide publicity canpromptly get crushed when its product or service becomes a hit.

Even though every company should have a strategic plan in placebefore the big day arrives, most small business owners are so busyjust trying to survive that planning usually gets put on the backburner. That's why we've have put together this 10-stepsurvival guide to help you think fast and react quickly when youwake up one morning to find the world beating a path to yourdoor.

1. Take a deep breath. Don't max out your creditcards, splurge on a big bottle of champagne or do anything crazy.While it's only natural to want to celebrate the good news,remember that a big contract or great press doesn't meandollars in your bank account--at least, not today. So hold off onthat Ferrari or tropical vacation. Also, remember that theadditional sales you ring up will probably require you to lay outmore money for people, materials and overhead--and may require youto borrow additional capital as well. "The financial successwas sweet, but it didn't change the way I live my life,"says Barbara Unell, a Leawood, Kansas, parenting book author whohit it big on Oprah eight years ago.

2. Map out a strategy. Make a to-do list, crunch thenumbers and marshal your human and production resources. It'salways easier to fight a battle on paper (or a computerspreadsheet) than to shoot first and ask questions later. No matterhow much pressure you're getting from your customers to deliverthe goods right now, you need to take the time to sit down withyour partner or staff to map out a plan of attack. For amanufacturing company or a wholesale distributor, this meansestimating how many units of your product you think your customerswill buy and how much it'll cost to produce or import them. Aservice company like an ad agency or a Web design firm will have toestimate how many additional employees or independent contractorswill be needed to service the expected influx of new accounts.

3. Get the money. Before you go on a hiring binge orstart placing orders overseas, it's important to figure out howmuch working capital you're going to need to meet the marketdemand. Because employees and manufacturers generally won'twait until you've sold the products and collected the moneybefore you pay them, you'll need a source of capital that youcan tap immediately.

If you've got an existing business with good credit, yourfirst call should be to your bank to set up a credit line orincrease the one you have. (A credit line works like a revolvingcharge account in which you draw down money as you need it and onlypay interest on the amount you owe.) Suppliers may also be willingto extend the capital and/or credit you need to fill the order. Anddon't forget about credit cards. Says Andrew Brunger,co-founder of Kol Design, a New York City company that produceshigh-end bath and body products, "Because your personal creditrecord is at risk, credit cards should only be used to finance areputable purchase order, not to fund the business as a whole. Withgood credit, you can build a $250,000 credit line for your businesswith very little effort."

4. Reach out for help. Call on suppliers, personalcontacts and the Internet to find extra hands to help you. If youthink you can do it alone, think again. No matter how hard youwork, there are only 24 hours in a day and you've got to sleepduring seven or eight of them. That's why it's important toreach out to people who can help you.

If your company already has employees, ask them to put in extrahours to help you get over the hump. If you're a one-personshow, you can reach out to friends and family members to help youor, if they don't have the skills you need, you can post ads onWeb sites like craigslist to find skilled freelancers and independentcontractors. But beware: Your overnight success may not lastforever, so don't commit to hiring full-time employees withpayroll taxes and benefits until you're sure your company'sgood fortune is here to stay.

5. Forge production partnerships. A small business makinghandcrafted soaps is going to be hard-pressed to fill amillion-unit order from a large national chain completely on itsown. That's why it's important to partner withmanufacturers in the United States and overseas who can take yoursamples or prototypes and produce them in large quantities. Whilethere's no shortage of suppliers listed on the Internet, areliable manufacturer that delivers high-quality goods is not soeasy to find. Your best bet may be to contact your industry'strade association and its leading trade publications (industrynewspapers) for consultants and referrals.

6. Create a distribution network. As news of your productor service spreads, you may start getting orders from consumers andretailers all over the country. If you're like most businesses,you're going to need help selling and servicing those accounts.Rather than hiring a national sales manager and opening offices inmajor cities, a more cost-effective option may be to sell yourproduct through manufacturers' reps. These reps (or rep firms)act as independent sales agents for multiple product lines and workon a commission-only basis. In the apparel, shoe and toyindustries, for example, reps typically earn a 20 percentcommission on any products they sell. Most reps generally havelong-standing relationships with the retailers they sell to andoften sponsor booths at leading trade shows to showcase theircustomers' products.

7. Communicate with your customers. Communication is thelifeblood of any business relationship, but it's even moreimportant when your product or service suddenly takes off. Thebiggest mistake a business owner can make is failing to warncustomers of shipping or production delays until it's too late.This is especially critical in the apparel and toy industries whereseasonality is important.

Manufacturers who fail to communicate with key retail andwholesale customers may find themselves not only with egg on theirfaces but with unsold inventory in their warehouses as well. DavidBradford, a Holtsville, New York, general contractor, puts it thisway: "In construction, there are so many things that arebeyond your control. I would rather tell my customers the truth andhave them be angry at me for five minutes than make excuses andburn my bridges forever."

8. Leverage your success. The hardest thing aboutachieving overnight success is keeping it going. The last thing youwant is to get stuck with a warehouse full of pet rocks. Creatingline extensions like the Chicken Soup books or the ForDummies series is one way to keep your brand alive. Another isto find new markets for your products and services or new ways topublicize them. Barbara Unell, the nationally known parenting bookauthor, got her big break in 1996 when her book, 20 TeachableVirtues, was spotted by a producer for Oprah who calledand asked her help in creating an entire show around her title. Notonly did her book's sales double, but the publicity from theshow also led to speaking engagements, workshops and otherprojects. "Before I went on the show, I'd be introducedwith my credentials," Unell recalls. "Afterwards, it was'as seen on Oprah.'"

9. Invest for the future. While it may be tempting toreap the profits from your hit product right away, it'simportant to re-invest some of those profits to help your businessgrow. Whether this means paying down debt, buying new equipment,hiring another employee or opening another location, don't passup this opportunity to make your money work for you. It'salways cheaper to put your own cash to work in your business thanto borrow money from a bank or give up equity to an investor. DanParisi, owner of the highly-trafficked Web site, House.com, whichconnects home buyers with real estate brokers, says he'sre-invested his profits into public relations efforts andtechnology. "As we've grown organically without raisingcapital, our goal is reach out for the assistance we need whilemaintaining profitability," Parisi says.

10. Learn from your mistakes. After the excitement of theinitial sales rush has died down, take a few hours to sit down withyour staff to figure out what went right, what went wrong and whatyou think you could do better in the future. This will help you puta strategy in place for the next time you come out with a hitproduct--which could be sooner than you think!

More Resources

Got a hit on your hands and don't know where to turn? Checkout the Web links below to get the help you need today.

CraigsList: This is a great place to findfreelancers and independent contractors, and it's free tosearch and--in most cities--post.

VendorSeek: This online marketplace helps matchcompanies with vendors of products, services, equipment andstaffing.

Net-Temps: Here you'll find employmentlistings for employers and seekers of full-time, part-time andtemporary jobs.

Manufacturers' Agents National Association:This website offers a searchable directory of manufacturers'reps and agents in the United States and worldwide.

Credit-Card-Source.com:Go here to find help navigating your way through the maze of creditcard offers so you can pick the best card for you and yourbusiness.

Rosalind Resnick is president and CEO of Axxess BusinessConsulting, a management consulting firm for startups and smallbusinesses. She can be reached at Rosalind@abcbizhelp.com or viaher Web site at www.abcbizhelp.com.

Rosalind Resnick

Rosalind Resnick is a New York-based freelance writer, entrepreneur, investor and author of The Vest Pocket Consultant's Secrets of Small Business Success.

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