Part 3: Subject of Experiments

becoming a millionaire one day, so we asked Arthur Knowles, who made his millions in the plumbing business, to give the budding entrepreneurs among you a few tips on how to make your first million.

Arthur, welcome to the programme.
Thank you.

So Arthur, what advice do you have for our listeners?
Well, one thing I’ve heard people say is that when you’re starting up a business, you can’t afford to make mistakes. Well, I believe in the old saying, a person who never made a mistake never made anything. You can’t really predict when you’ll make mistakes, and you have to look at them as a positive experience — one that means you won’t make the same mistake again. You need to be able to cope with the world of business.

But according to recent American business school studies, believing in yourself isn’t enough by itself to guarantee success. Confidence can be a good thing, but a person can have too much confidence, and people who try to learn to be confident by buying those How to Succeed books are just wasting their time. The advice given in these American studies was that being a successful entrepreneur comes down to having the right attitude.

It’s no good getting depressed every time something goes wrong. Always keep your goals in mind and never give up — and don’t listen to all the people around you who say, oh, this will never work.

One thing I’ve learned in business is that you don’t have to be an expert in everything — like marketing, for example. When I started my business, I tried to do it all myself, but I soon realised that although I knew everything there was to know about plumbing, I didn’t have much idea about how to sell my ideas. So I got someone who knew more about this to take care of the marketing side of things for me.

Then as for leadership — well, you’ve got to be someone your workers look up to because you’ve been seen to make the right decisions. You have to be able to control people but listen to them at the same time. Some people are driven to make their companies successful, but that too often leads to a ruthless approach.

Then there’s the question of taking risks — even calculated ones. I personally feel it’s actually better to tread carefully when it comes to taking short-term risks. You need a degree of vision, certainly, but it’s easy to get carried away by your desire to increase profits, and if things go wrong, you can end up losing more than you gained.

So if you have a great idea for a business, what should you do next?
Well, the first thing to ask yourself is whether there’s a need for your product or service. Can you cater for people’s needs better than existing companies? You don’t need to worry about whether it’s original or not, because there isn’t always enough of a demand for completely new ideas.

And the second thing to ask yourself is not what colour should the packet be or how much should it cost, but do I care enough about this idea to dedicate the next ten years of my life to it — because realistically that’s how long it will take.

Tell us how you got started, Arthur. How do you explain your early success?
Well, I started my business just as the economy was going into a recession, which wasn’t the best time, and I was lucky to survive, especially as the banks weren’t being particularly supportive to small businesses at that time. If I’d listened to the business advice I was given back then, I’d never have got started.

My strengths were that I knew I could provide a better service than my competitors, who really hadn’t spotted the opportunities that were out there, and that my wife had a good job and was able to pay the household bills while I was getting the company on its feet.

The first couple of years were very tough, but I knew I would make it eventually.

Okay, now we’re going to take some calls from listeners.