It’s critical to ask yourself several questions prior to starting your new business. You must understand the basics of what you are doing and how you are going to do it. Obviously, we are in the business of business plans, but the reality is a business plan is a good plan for now and will change as your business and the market change. No company ever follows their business plan 100%. It’s just not realistic.
When you are starting your business, focus on several key questions to ensure you have a product and market that can be successful. These questions are relatively simple but key to success.
1. Who are you targeting? Be as specific as possible here. You must address your target market that you are going after. Of course, you’ll generate some revenue outside of that target. But the bulk of your customer base will be in that target, and that’s who you must remain focused on.
2. Are you better than your competitors? Don’t create a product or service that simply imitates someone else. How are you better? How are you different? If you’re not, you must find some competitive advantages before moving forward.
3. How do you get the product to market? If you are selling your widget, how do you get it manufactured? How do you distribute? And at what cost? If you are selling a service, how do you execute it and get the customer what they are looking for?
4. Can you advertise efficiently and cost-effectively? The “build it and they will come” mentality is alive and well in today’s entrepreneurial marketplace, and it should be dead. You must market. You have to get your product out there. It’s true that if it truly is revolutionary, some of this will take care of itself. But you absolutely must get an initial push. And that usually takes capital.
5. Who do you need in place to make this happen? Maybe you’ll be taking a major role in the business, but who else do you need? How do you fill in for your weaknesses? What other members of management, partners, personnel, and other vendors are necessary to make this work?
You must answer these questions before getting started. If you don’t, you’ll find yourself struggling significantly in the early days until you answer these questions.
