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How to Avoid The Pitfalls of a Small Business Start-up?
Avoiding potential and actual pitfalls in business start-ups is a function of good research, finding out what your customers want and then simply supplying the desired product or service to them.
Starting a new venture or trying to realise an ambition of a life time is very exciting and spiritually uplifting experience. But, make no mistake this is one journey where you will uncover shocking surprises if you decide to travel on this journey. However, it is not all doom and gloom you can adopt some simple strategies to minimise your risk. Below is a list of potential pitfalls and how they can be side-stepped:- 1)Start with the market and not the product. Find out what people want in the market place and then sell them exactly what they want. In other words, conduct a survey and see if there is any demand for your chosen product before developing the product. Some people advocate finding out what people are buying by visiting internet and examining products that are being searched for. There is merit in this strategy but it is only relevant if your market is world wide otherwise the internet data will distort your analytical results. 2)Controlling your marketing spend. Marketing is the key to creating awareness and thereby market penetration. However, it is quite easy to spend all of your marketing budget and not generate any sales. Test the water with your advertising campaigns. Run a few advertisements and check to see if they generate any sales. Write your advertisement yourself and talk about all aspect of your business or service and service delivery. Make an offer that customers will find irresistible, give them an incentive to test your product or service, back your offer with a no quibble money back guarantee. 3)Don't wear too many hates yourself. It is very easy to think that you have to do everything yourself. There are two possible consequences of an attitude whereby you think that you can do everything yourself; you prevent your business from developing simply because you are doing too much and more importantly you will lose focus and sight of where you want to go. 4)Set a sensible pricing structure for your products and services. Set your prices that are competitive as well as profitable. New entrants in the small business sector tend to undercut their competitors and by so doing don't make any profit. Consider this scenario; wedding quote for 100 people, lunch and evening buffet, silver service, champagne and wine with bride and groom's own labels on them. It is easy to quote a price of $50 per head because that sounds within the ball park. However, upon working out all the costs we came back with a per head price of $70 per head. Moral of this story being that working out prices before preparing quotation is a good idea and we advise people to conduct this exercise every time. 5)Use technology to create awareness. Internet is the best vehicle to tell your potential and actual customers about you, your products and your service. However, you need to line up what you do with the way you present your information on your internet site. Make sure that you design your internet site yourself and by that I mean replicating what you do and how you do it pretty much exactly how you do it. Otherwise, you may harm your business because you may not get noticed. 6)Set goals; both end goal and the intermediate ones. You need to decide where you want to be in two years' time. By setting that target goal, you will then set a road map for your business to go for. The road map will consist of intermediate goals along the way which you can use as testing tools to gauge your progress and fine tune your strategy as and when the need arises. 7)Take action. According to the motivational GURU Anthony Robinson you've got to take action. Take massive action he says. Having a good and well researched idea is not enough, you have to implement that idea otherwise all the effort to date amounts to very little. Just do it. Finally, about 90% of the business success can be attributed to good management team, well researched market, a good and feature rich quality product as well as good financial backing to say the least. The remaining 10% of the business success is to do with luck, risk taking and even being in the right place at the right time. Be thorough in your research, understand your market and your product, follow the above 7 steps and you will have avoided the dreaded pitfalls.