This article are provided for information purposes only, and are not intended as legal advice.


Starting a business

April 28th, 2009

You have finally made the decision that you want to start a business, what do you need to get going?  The first thing that you need is a plan, what do you want to do, are you selling a service, a product, what are your goals, do you have any contacts that you can test the market?  Should you do some market research?  This does not need to be an elaborate study, you can do a quick survey yourself.  Come up with an idea, then ask friends and family if they would use the service, buy the product.  Get their comments, do they think that this is unique or are you just another vendor?  What differentiates you for others?  After you get their comments, do you need to rethink what you are doing?  Should you make some changes to your original plan? 

 

Most people think that a business plan is a formal document that is going to be used for bank financing.  Even if you are not going to get bank financing, you still need a game plan.  You need to spend some time analyzing your approach, do the mini market testing, perfect your approach just using a small group of people, once you have modified your approach and you are happy, then go and approach some potential business customers.  Do not go to 20 all at once, approach one, see what their reaction is.  Is your approach right, do you need to change your approach so when you go to the next customer, you have already made some changes.  Since you are experimenting with your approach, you may not want to approach the largest potential customer first. If you do and you make a poor presentation, you may not be able to get in the door again.  Go to smaller players first, try your approach, see what works then move on to bigger customers.

 

When you start a new business, many businessmen are not focused, they try to do too many different things all at the same time, that means you start lots of items and do none well.  Start with one idea, expand it, perfect it, then start to add more products or services.  When you have not been in business before, to offer 10 different choices of products/services before you know how to make the distribution system/consulting work.  If you are a distributor or retailer, you may have to purchase minimum quantity of goods from some suppliers.  Do you buy from 10 different suppliers or buy more in one place, get over the minimum quantity and try to sell that product.  You may want to have lots product but you have to watch your cash flow as you start off.  To have all your cash in inventory and no funds for working capital can be very detrimental.

 

From past experience, I have seen too many people expanding too fast and not perfecting what they have as a new business.  Walk before you run and think your plan through before you start your new business.


Filed under: Business strategies — Gary Landa @ 9:22 am


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