There are a number of factors to consider when you are starting a business. Here are some tips to help you start a business that has a good chance of success.
1. What is your point of difference?
I have made this the first point because I consider it to be one of the most important. Many people start a business because they think they can do it better than the company they work for. Others have an idea and want to try it out.
But you must ask why customers would choose your business instead of your competitors.
If your answer is ‘cheaper price’ you will only have that advantage until someone cheaper comes along.
It is important to work out how you can be different so customers will choose you.
2. Who are your potential customers?
You need to define your ‘target market’. What do your ideal customers look like?
This is called ‘demographics’ and it is very important to get right because the next question is: why do they buy?
This is called ‘psychographics’.
If you can get these two things right you will be able to create marketing campaigns targeted to the exact people who are likely to buy from you.
3. Cash flow
The most important financial element in a business is cash flow. There are many examples of people who have started a business, made a few dollars and then drawn it out to live on without leaving enough money in the business.
Even when you are making sales, cash can be eaten up in inventory, or accounts receivable where you have made sales on credit and the customers have not yet paid you.
Excellent management of your cash flow is critical to your business success.
4. Great Customer Service
I mentioned earlier about being different. When you ask many business owners what makes them different, they say ‘their service’. Excellent customer service is not an option. It is an imperative for a successful business.
5. A Great Team
You may well start out doing everything yourself. But it won’t be long until you need assistance. Get a good team around you and look after them. Your team may well end up being your most important asset.
I trust that these few tips are helpful as you consider starting a business.
I also came across this video where Richard Branson talks about starting a business.