Entrepreneurship is challenging, requires lots of sacrifice and has a high failure rate, but it can be the most rewarding thing you will ever do. Before starting a business, some serious questions should be considered.
“Why am I starting the business?”
The answer cannot be “to make money” or to “employ people” or to “have freedom.” These might be by-products of having a successful business, but the truth is that if your business is not providing a solution to a need in the market, there is no business. Business is not about you, it is about fulfilling customer requirements at the right time, place and price.
“What pain am I relieving for my clients?”
Once you have identified why you are starting a business, the next thing to identify is, “what pain am I relieving for my clients?” In other words, what is the experience you want to give your clients? Pain can be relieved by making things easier, nicer, more exciting or just simply better. The key is to invent a solution that does not currently exist.
“What am I offering that makes my product or service offering unique?“
When offering a similar product or service in the market to what already exists, you need to ask; “What am I offering that makes my product or service offering unique?” What is the point of offering my solution and why would the market buy/use my service/product and not the competitors’ offering?
What is the incentive for the client to use my services or product? In some cases it may merely be the ease or convenience of the solution, for example, McDonald’s sells burgers (as do most fast food outlets) but their uniqueness lies in the fact that you can walk up to the counter, order and immediately get your burger. There is no waiting in a queue for your meal.
“Who are my competitors and what are they doing in this space?“
You need to understand the environment that you are going to work in. You need to ask: “Who are my competitors and what are they doing in this space?” In line with the above example, you could ask; what would the reason be for starting another restaurant? You would need to find an angle that gives your target market a great incentive to buy from you rather than from your competitors, whether it be the menu or the experience that you create.
“What are the risks involved in starting a business?“
This is a very important question to ask yourself. What if you don’t get the orders within the first month of operation, or you get an order that is so big that you do not have the capacity or resources to deliver? What are the financial implications for your business in these scenarios? Thorough planning should be conducted to ensure that you dedicate yourself to lifelong learning about business and your sector.
The first step in starting your own business is to answer the five questions above truthfully and carefully. Only then can you start looking at launching your idea.
Should your answers to the questions indicate that it would be wise to start your own business; the following five steps should be followed.
1. Put your business ideas down on paper. This should include an outline of how you want to start the business, how you are going to make money, who you wish to target as clients and, most importantly, why this idea will work. Planning should be done with regards to how the business will be funded.
2. Create an identity for your business. Make sure that you have a name that is easy to pronounce, is memorable and is easily recognisable. It should be a name that is simple. Test the name out with friends and family. If your offering will be sold across different cultures with different languages, it would be advisable to test the possible name with other language groups.
3. Register the name and the business with the Companies and Intellectual Property Commission (CIPC).
4. Put operational systems in place. How are you going to handle, process and deliver on orders received. What systems would you need to put in place to ensure that you give optimal service?
5. Make the calls and see the people! If you can’t sell, you don’t have a business. Get out into the sphere of your target market and promote your products and/or services. To do this, you need to have developed the product and/or service offering, you need to know what you are selling and to who.