Pillar Two: Mastering Analysis to Build a 7-Figure Business

In the previous posts, we discussed the importance of research as the foundational step in building a successful 7-figure business. Once you've gathered your research, the next critical step is analysis—another essential pillar that guides your strategy.

Analysis is where you separate facts from assumptions and leverage data to sharpen your approach. Without a proper analysis, your business decisions will lack depth and direction. So, how do you effectively analyze the information you’ve gathered, and why is it so vital to your business’s success?

Turning Data Into Strategy

After conducting thorough research, it's time to take a closer look at the data. The analysis phase gives you insight into your market, your target audience, and the trends that could impact your business. It also helps you identify the true market you're aiming to enter.

Understanding your market isn’t just about knowing your competitors; it’s about pinpointing your specific target audience and recognizing the value you can bring to them. This process informs your overall strategy, helping you refine your product or service offering to better meet customer needs.

Actionable Tip: As you analyze data, always ask, "How does this impact my business strategy?" Whether it's identifying trends or evaluating customer preferences, ensure that your analysis translates into actionable insights.

Using Tools Like SWOT and PESTEL

Effective entrepreneurs don’t rely on gut feeling alone—they use analytical tools to make informed decisions. Two widely recognized methods for business analysis are SWOT (Strengths, Weaknesses, Opportunities, Threats) and PESTEL (Political, Economic, Social, Technological, Environmental, and Legal) analysis.

SWOT helps you identify internal factors, like what your business excels at and where you might need improvement. PESTEL, on the other hand, considers external factors that could affect your business—such as legal restrictions or economic shifts. Understanding both internal and external dynamics ensures that your business is well-positioned to succeed.

Actionable Tip: Conduct a SWOT analysis for your business today. List your strengths and weaknesses, and think about the opportunities and threats in your market. Follow this by evaluating external factors using PESTEL. This combined approach will give you a clear, comprehensive view of your business environment.

The Rule of 10: Benchmarking for Success

A personal strategy that I often employ is what I call the Rule of 10. When analyzing any business idea or sector, I look at 10 other businesses or individuals who are already doing what I aspire to do. By comparing their strengths, weaknesses, pricing models, and customer feedback, I can see where my business fits in that landscape. This provides a starting point and ensures that I’m working within the boundaries set by market conditions.

For example, if you’re trying to offer a new service, you might feel that it deserves a premium price. But if the market sets a limit on what customers are willing to pay, you’ll need to adjust your expectations accordingly. Analyzing these factors will help you establish realistic pricing and value propositions, ensuring you meet customer expectations without exceeding market constraints.

Actionable Tip: Choose 10 businesses that are similar to yours or that operate in your target market. Compare their services, pricing, customer satisfaction, and overall strategy. This benchmarking exercise will provide you with key insights to refine your approach.

Regulatory Considerations: Why Strategy May Need to Shift

Many entrepreneurs come up with great ideas only to discover that they face unexpected regulatory hurdles. This is why legal and regulatory analysis is crucial before you dive too deeply into any project. You may need to adjust your strategy to comply with industry regulations or face the reality that certain ideas won’t work under the current laws. A thorough analysis will help you avoid costly mistakes and refine your plan to fit within the necessary legal frameworks.

Actionable Tip: Always check the legal and regulatory requirements of your business sector early on. This includes local, national, and international laws that could impact your operations. Aligning your strategy with these requirements is key to avoiding roadblocks later.

The Power of Analysis in Business

The analysis phase is where your business ideas become grounded in reality. By leveraging tools like SWOT and PESTEL, benchmarking against other businesses, and understanding the regulatory landscape, you ensure that your strategy is not only well-informed but also actionable. Analysis is the bridge that connects your research to your business’s success.

To dive deeper into how you can use analysis to build your 7-figure business, grab a copy of the 7-Figure Business Owner Workbook for in-depth exercises and actionable strategies.