Taking the leap of faith to start your own business is difficult enough. According to the SBA, in 2008 an estimated 627,200 businesses opened. On the flip side, an estimated 595,600 closed their doors. While many factors contribute to the decision for a business to open or close, prioritizing the following three items will get you headed in the right direction when you start your own business.
- Business Plan – The most important part when you start your own business is developing your business plan. A business plan forces you to consider all foreseeable areas of your company and address issues before they occur. It helps you to diagram the operations, research your competition, plan your marketing strategy, and understand how you will make money. It is the most critical part of your business, it will grow and expand as your business grows and expands. A business plan should be developed before you ever start your…
Ralph Waldo Emerson is credited with the oft-quoted remark in favor of innovation: “Build a better mousetrap, and the world will beat a path to your door.” Though brilliant and an outstanding essayist, Emerson could not have been more wrong. This quote has since left countless entrepreneurs under the wrong impression that all they have to do come up with a great new idea or design and their work is finished. The world will take notice while they sit back and watch the sales roll in.
There are several inherent flaws presented. The first is lack of marketing. If you build the best mousetrap or car or computer and potential consumers are unaware that you exist, nobody will know that there is even a path worth beating. After watching the Super Bowl, it is clear that many of the companies advertising are not “best of breed” and yet they often dominate their industry with their marketing…
Has anyone ever built a successful business without a business plan? Sure they have. However, I’m hard pressed to believe many interested partners, private investors or investor organizations give money to entrepreneurs with out seeing a well outlined business plan and a professional presentation first. Unless this individual or group has started many great businesses prior, blind investing won’t happen. If it does, the investors are most likely betting on the “jockey” (individual), not the “horse” (business concept).
Chances are you’re here because you don’t have that reputation of turning out more million dollar businesses than you can shake a stick at. To help, here are two very useful tips for business plan writing and presenting.
1) Being to the point wins people over: Don’t lengthen content because you feel it looks more legitimate. Audiences tend to pick up on that and will get irritated their time is being wasted. This goes for writing and presenting. Explain…
Will Arizona win the Holiday Bowl?
I watched a video featuring Mark Cuban, the outspoken owner of the Dallas Mavericks and chairman of HDNet. Some of the video revolved around business growth and Cuban’s vision for a high definition television channel. In 2000, high definition televisions were $15,000+ (thank goodness for Moore’s Law) and very little programming was available. With such a high cost, the market for HD viewers was low in 2000 but Cuban wasn’t just thinking about 2000, 2001 or even 2002. He was thinking about 5 and 10 years from 2000 when you could go to Best Buy and purchase an HD TV for $500.
Worst Case Scenario
If you have a checklist with steps to starting a new business, the very first thing on the list should be a business plan. In particular, you want to validate your concept by doing research on the industry and environment. What problem exists and how are you solving this problem? Who is your competition and on what basis are they competing? What are your competitive advantages? Does your business possess any barriers to entry? If you can satisfactorily answer these initial questions, then its time for a business plan.
Rhonda Abrams, in A Successful Business plan states: A business plan provides mechanisms to enhance your management in these areas:
- Marketing. By developing a marketing plan based on a well-defined target market and evaluation of your industry and competition.
- Operations. By evaluating and establishing the procedures, labor deployment, and work flow necessary to run your business from day to day.
- Finances. By realistically projecting cash flow, income and…
