Whether you have gotten a windfall, a great idea, a bit of time after retirement, or simply bored from your current place of work/ life, starting a business is always a interesting time. However, the number of companies that die in the first 0-12 months alone is astounding. Following 5 points are good to keep you in check with your goals :
1. Cash will be your salvation :
Cash flows are critical, regardless of the age of your company. Have a plan at hand, as to how much cash you would need to keep your business afloat. This includes your operating expenses, taxes as well as your personal expenses, (for full time entrepreneurs). Find out your survival number!.
2. Plan>execute>study>plan>execute…
Don’t jump head first. Have a plan. Get the basics right. Get the resources in place. And then, test test test! Don’t hold on, for the perfect market conditions. Fragment your solution into a small enough pilot, and test. Then, go back to the drawing board. Over planning is as bad as not planning at all. Divide and conquer the market!
3. Value addition vs. Uniqueness
USP (Unique Selling Proposition) is a concept, failed on a very large multitude of firms in the market today. Well, to be honest, you don’t have to be “Unique” on Day 1. You need to add value first, at an appropriate price point. If the service offering you have is not in a strictly commoditized market (commoditized markets are sectors where there isn’t much scope of the final value being delivered, like Food delivery, cab booking, ticket booking), you can have a free run as long as the customer gains value.
4. Find a growing market
Go for a growing unsegregated market. Your product is great, but you are not sure if the customer base will at least double in the next 5 years; it’s a bad idea to continue. When your product is not significantly different from others in the market, it is not a good idea to invest your time and money. Unless you can create a strong enough differentiator, your product will ride the waves and falter when the demand hits low periods or when the bigger players pump in Ad money
5. You don’t have the right answer Slightly philosophical, but hear me out! Accept that your first product type/ idea is not in its completed state. Accept that your focus customer base may be wrong for your product. Accept that your growth/ marketing strategies may be wrong. How to beat this? Step 1 + Step 2+ Step 3 + Step 4