So you think you’ve stumbled on a unique opportunity in the market and are thinking of setting up a business to fill that need? That’s incredible. Now, you have to be careful so that your business doesn’t become a statistic.
We understand that you’re pumped, excited, and raring to go. But, before you go ahead and lose your life savings to the business, you need to make sure that you have the right structure in place. Otherwise, you may end up struggling to stay afloat in a few months.
Do Your Market Survey
The first thing you need to do is validate the idea. Remember that for every successful business, there are at least, a hundred similar businesses that have crashed and burned. So, talk to and consult with experts.
More importantly, talk to the people who may have the problem. Thanks to technologies like social media, you can easily throw up a focus group, survey, or poll, promote it to your target demography, and see how the market responds.
Plus, set up a beta-testing group and have people opt-in to be notified when the product or service is ready for launch.
Make Sure Your Budget is Sufficient
How much do you suppose it will take to successfully launch the new business? For starters, we’re talking about inventory, shipping, manufacturing, and business setup costs. And this is just the beginning.
You need to factor in every cost that you’ll need as well as figure out funding sources. In our estimation and from experience, whatever number you have right now, add another 50 percent.
You’ll need that cushion and more as things tend to pop up that you don’t anticipate. These “emergency funds” are what you’ll use to tackle this problem whenever it arises.
Thinking You Can Do it All Alone
Here’s the thing with many entrepreneurs, they try to do everything by themselves. You’re probably like that too. The problem with this approach is that you’ll end up burning out very quickly.
So this is what we recommend: be open to the idea of hiring people to handle the less critical aspects of your business. For instance, instead of trying to make the prototype of your product yourself, why not just outsource that to experienced manufacturers or prototype-makers.
All you have to do is talk to them about your idea and see what they come up with. Then, you can fine-tune as you see fit. Remember there’s only so much you can do in 24 hours. So your energies and time should only go to the most important tasks.
Have a Marketing Budget
Listen, the “build it and they’ll come” days are long gone. Also, first to market is not necessarily an advantage if people don’t know about your product or service.
So, you need to have a good budget for marketing that’ll be enough to reach your target audience and sustain the exposure until the momentum builds up and you can reinvest the revenues from your sales.