February 8 2009
For anybody that has worked in an entrepreneurial business environment before there is an inevitable point in time in which there is a conversation loop about growth of the business with process and automation instead of taking the easy route of hiring more people to solve problems.
Credit Michael Gerber the author of E-Myth Revisited for most of these conversations.
When the book published in 1995, it sparked a long run on the non-fiction best-seller list that continues to this day, becoming one of the bestselling business books of the last 15 years.
The premise of the book is simple enough; Gerber posits that there are three types of entrepreneurs –
1) The technician (the doer and builder),
2) The manager (the planner),
3) The entrepreneur (the dreamer, visionary).
Simply enough, a business depending on its leadership, has different needs at different times based on the type of leader the organization has – the failure to recognize this and adjust accordingly unfortunately leads to many a ventures downfall.
For example, according to the book, the failure statistics for small business is alarming—40% fail in 1 year. Of those who survive 1year, 80% fail in 5 years, and of those who survive 5 years, another 80% fail.
However, if you look at the success rate of franchises – 75% are still in business after five years.
Why the stark contrast between an independent business and a franchise?
The product of franchise companies is a business system, not whatever product they may sell. Franchise companies have a clear execution path—operations manuals, procedures, sales approaches- -every detail of running the business is specified down to dress and wall decorum.
This “turnkey” approach offers a greater chance of success because most entrepreneurial people, regardless of whether you are a “technician,” “manager,” et al follow a passion, not necessarily their experience.
The business system format is grounded in the belief that the real product of a business is its operations and sales infrastructure rather than what it sells.
So, what does this have to do with wine?
Crushpad, in conjunction with a newly announced strategic partnership with Napa’s Bin to Bottle, is slowly but surely moving from being a place that manages just the infrastructure of making wine to creating a business system for running a wine business, even calling it a “winery in a box.”
To quote from their press release announcing the relationship:
San Francisco’s Crushpad and Napa’s Bin to Bottle, today announced a far-reaching strategic partnership to integrate the Crushpad Commerce set of wine business services with Bin to Bottle’s custom crush services. The result is the wine industry’s first plug-in service that manages all of the core business needs of wine brands in the 500 to 5,000 case range, potentially saving each brand tens of thousands of dollars and hundreds of hours annually.
Using the combined Bin to Bottle and Crushpad Commerce services enables brand owners to focus on the big picture instead of building, buying and piecing together the dozens of relationships, technologies and services necessary to support a successful wine brand.
Wine brands built on the combined service enjoy best of breed services that cover all of the core needs of operating a wine business
The site continues …
If you currently operate a wine brand or are starting a new one, and if you want to spend your time selling your wine instead of sweating the details of operations, you need to talk to us.
Hmm … sounds an awful lot like the business system premise advanced in the E-Myth Revisited.
It is not all milk and honey for Crushpad, though. Their public relations are great, but their marketing could use some refinement in messaging to be more inclusive of starting a business then simply making wine and their Crushpad Commerce does not allow for somebody from the public to browse wines/wineries – a nice touch that would allow consumers to browse for wine like one can do with indie musical artists at a label site and their Crushnet community site for people making wine to engage and interact with customers is very difficult to use. Some simple refinement in brand messaging and a complete user-centric overhaul on some technology would be a significant benefit to everybody in their value chain.
However, in the most competitive consumer product category next to quick service restaurants like McDonald’s, the wine business is making radical advances in allowing the dreams of winery ownership to become a reality. In addition, to the credit of Crushpad and Bin to Bottle, there is a distinct element of high quality, forsaking the easy path to produce plonk with a pretty label.
Combine this with a Wordpress site for next nothing, as noted in this blog post by Brian Overstreet from Bruliam Wines, a Crushpad customer, and a couple of other inexpensive tools to manage customer relationship management and accounting and the reality of running a wine business is very accessible to most everyone, everywhere.
The reality of making a six-figure income, in the wine business, from your home office, in your PJ’s, may sound like a pipedream, but the reality is its closer then you think.