We often read about the value of brand names: “The ikea brand alone is worth $12 billion – Interbrand”
Not really. The value of a brand is the infrastructure and value chain which has been built behind it, resulting in the ultimate revenue streams. In truth the brand name is worth very little. Think about many of the unexpected and surprising corporate failures. Lehman Brothers, Ansett Airlines and Worldcom to name a few. What are their brand names worth today? Zilch.
If the brand name was really worth something, they would be sold and re-launched in some capacity. When any company is bought, the brand name is merely an adendum. It’s not the name that is being bought, rather the system, the structure, actually it’s the organisation. Of which the brand name is a very small part, even though it is what is spruked as the compenant of ultiamte value.
Startups who want to build a brand should think less about names and logos and more about building an infrastructure and revenue streams.
It’s no secret I’ve spent some time abroad recently – the tile of recent entries has been a total giveaway.
One of the areas I reckon all entrepreneurs should cut their teeth in is a bit of gardening. The skills required for successful gardening happen to be highly transferable for entrepreneurs. I always keep my my garden in good nick. But this is the condition is was in upon my return.
My beloved box hedges are not very healthy to say the least.
Sure we had some hot weather. But I knew it was the middle of a Melbourne summer which regularly gets temperatures above 40c / 100f . So why didn’t I prepare for the resources to cater for the ‘potential challenges’ the hot weather could present to my garden? It’s pretty simple really. I assumed it would be OK for a few weeks. I assumed that things would progress as normal and we wouldn’t have the hottest temperatures on record – which we did.
I failed to prepare for the worst case scenario. Actually I failed to have an infrastructure set up so things would not only continue in my absence, but have the ability to respond to extraneous circumstances. The net result is business failure. Dead garden. Which means that my garden business is still a sole trader, a side interest or maybe just a hobby.
We only have a business when we can be absent and;
- things get done anyway
- emergencies get attended to
- our customers are unaware of our absence
- we return with no ‘noticeable’ difference
So the questions we must ask ourselves as entrepreneurs, is how we are building an infrastructure which doesn’t rely on us? It’s only once this is in place, that we actually have a business.