If you are running or starting your own business, The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It by Michael Gerber is a must read. I first read this about a year ago, I had recently quit my full-time job to run my own business, and although I understood what Gerber was saying, I couldn’t understand how to apply it to my business. I recently picked up the book to read again and was amazed at the difference in my perception. So, if you read this book or have read it in the past and felt it didn’t apply to you, put it away for 6 – 9 months and then come back to it.

Right off the bat, Gerber gives some scary statistics for small business owners:
40% fail in 1 year; Of those who survive 1 year, 80% fail in 5 years, and of those who survive 5 years, another 80% fail. That means in 10 years only about 2 out of 100 small businesses will survive. The good news, Gerber offers a solution for making sure that your business is one of those 2.

Gerber does a nice job of classifying the small business owner, someone who starts a small business because they love the craft of it, he calls these people technicians. But a couple of years into it they haven’t done a good job of managing the business and are so burnt out on the craft they can’t enjoy it anymore. Does that sound familiar? It definitely resonated with me and on my second read made me clearly see that I needed to take steps immediately to insure that my business was around for the next 10 years.

Gerber also talks about the lack of planning and benchmarks for most small business owners. As a whole, we are not taking clear steps to insure success, and when we take those steps we aren’t measuring their effectiveness. Again, this resonated with me. For me, I was usually so busy trying to keep up I just didn’t have a good marketing strategy, and the marketing tactics I employed I didn’t track to monitor their effectiveness.

Gerber goes on to explain that if you setup your small business like a franchise, you can help insure your business success. Systems and processes as well as definable benchmarks are what makes a franchise successful, the same systems and processes can in turn help your business become or remain successful. Although he acknowledges that in the beginning, the small business owner will be doing most of the work, he helps you create an exit strategy to start hiring and delegating tasks so that you aren’t doing everything. On my first read, this idea scared me because I always feel like I am the best suited for the job, it’s time consuming to train others when I could just do it myself and I was worried that hiring would lower my profit margin too much. In hindsight I realize that doing everything yourself is just not manageable and hiring out parts of your business can free you up for marketing and bringing in more business.

The drawback of this book is that Gerber is extremely long-winded. There is a long detour in the middle of the book where he tells his story, which although interesting, isn’t necessarily essential. He also had an ongoing discussion with a small business owner that at times reads like a harlequin romance, with key information sprinkled in here and there. But, if you can get past the wordiness of his writing, the rest will become a key resource for your business success.