Give Yourself the Best Small Business Start
With the failure rate so high, you’ll want to give yourself the best small business start that’s possible. Today, I’m providing you with two areas to narrow your focus, so you can put your business in a position of success.
Prior to even starting a business, you’ll want to be sure you have a profitable business idea. The market is saturated with solutions for just about everything. Finding a product or service to sell is no problem. The difficulty comes into play when trying to connect customers with your particular product or service. Large corporations have phenomenal marketing budgets that allow them to pave a path to customers. Small business owners tend to have significantly smaller budgets, which requires a bit of innovation to get noticed by customers.
It starts with market research. That is, taking your idea and researching if the market is ready for it and how you can make money with your idea. Survey, test out your prototype, pitch your product prior to going all in. Even better if you can find buyers. What you don’t want to happen is making huge investments in a product no one is interested in purchasing. A crazy, but great example, is the episode of the Simpsons, when Homer designs a car.
Rather than fall into the trap of build it and they will come, ask questions.
- What is your profitable idea?
- Who is your target audience?
- Why would your target audience care about what you’re offering?
- Where will your customers find you?
- When is the best time to launch your business?
- How are you going to attract your customers?
Narrowing a Niche
I mentioned the big budgets large companies have in comparison to the micro-budget small businesses have. One thing you need to know is you don’t have to compete on the level of a large company to be successful. Whereas a company like Walmart is known as a place to get a variety of items, you might consider starting with one or two extremely valuable products. You become the expert in delivering your products, to the point your name and company is on the tip of the tongue when individuals are looking for solutions. People don’t go to Walmart for a priceless experience. They go because it’s convenient (other than the lines) and hopefully cheap. The idea for Walmart is to sell a lot at low prices. Quantity over quality. Flip the model for your business. Offer quality over quantity and charge premium prices. Doing so means you don’t have to sell as many products to reach the same revenue goals.
Determine who would benefit from your product and services. Your answer should never be EVERYONE. Why? No matter how great you think your product may be, not everyone is going to think the same. Use your research to determine the individuals you want to laser focus your marketing on. Some demographics and groups are far more suited for your products than others, whereas some groups wouldn’t even consider your products. Don’t waste your time, money, or energy on the wrong audience.
Narrowing your focus allows you to be a big fish in a small pond. larger companies cast a wide expensive net into the vast ocean, hoping to reel in an assortment of fish. A less expensive option, that yields more specific results would be to fish in a pond. The variety of fish in your pond will have less variety. However, they’ll likely be easier to catch and the bait you use will be very specific to the type of fish in the pond.
Strategic Business Plan
The second key item for creating a successful startup business is having a business plan. I’m an over planner, and have to pull myself back in order to implement. For others, I know planning isn’t as natural. However, I stress to you… implore you not to simply wing it. Not only is a business plan practical as a guide for your business, it also can be helpful for your mental health.
Your business plan can help you reduce stress. Your business can be more than a document that gets you funding. It can also be a strategy to get from point A to point Z. If you’re anything like the entrepreneurs I work with, you have a grand, fabulous dream business. You have an idea of what you want your business to look like in 5 or 10 years. At times, it may even seem like an impossible dream. A business plan helps make the impossible more possible. Don’t be afraid to look 10 years into the future. Then pull it back… what does your business look like in 5 years, 3 years, 1 year, 6 months from now, 3 months from now? 3 months from now is not nearly as scary as 10 years from now.
It can be difficult to see the path you need to take to reach your goals. Mapping out time chucks can act also as a measurement tool, and also help you truly focus on what needs to happen to day, so you can be where you want to be 10 years in future. Create a roadmap for your business. Companies with business plans have greater chances of success and increased potential for growth (full article). With failure being so high for businesses, your company can use all the advantages it can get.
A business plan can also help you start off with the right amount of funding. Complete business plans include financial projections. Projections act as a financial map for your business. It helps you determine the amount of money you need to start, as well as the money you’ll need to sustain your businesses during the early months and years of your business. Inadequate financial planning is a disaster waiting to happen. I’ve encountered so many entrepreneurs who come to me after they’ve already started their business, but didn’t account for the money they to get through the startup process. Many entrepreneurs can avoid that pitfall, simply by planning ahead.
There are a lot of moving pieces to a successful business. It’s up to you to put the pieces together in a way that makes sense and prepares you for success. It all starts with a profitable idea, which will take you on a journey of research. Once you have a solid profitable idea, it’s time to put together the plan that will reel in the profits. It doesn’t stop there. Your research is ongoing and your business plan is organic, requiring adjustments as your business changes.
Stay alert and constantly prepared, so you’re not caught off guard.