Do you have a business idea? Think it's never going to work out? Think again. Starting a business can be tricky, but with the right information and resources, it doesn't have to be. Here are five key points that people need to master as entrepreneurs in order to have success. (To learn more, check out Starting A Small Business In Tough Economic Times.) Know Your Market
TUTORIAL: Starting A Small Business
Have a Clear Vision
Having a vision is what encourages business owners to frame their initial thoughts and ideas. Your vision is what gives you the motivation to mold them into concrete results. Stay true to your vision and keep in mind that it can only get better with positive thinking and hard work. Having a clear vision will keep you focused when you are faced with obstacles and challenges. Here are some tips to help you shape your vision:
Allow Yourself to Dream
Vision is about future and the dream you want to achieve. Allow yourself to envision what life would be if you were guaranteed success in your new business venture. How big would the company be, where would it be, what would your role be, and what is your five-year and 10-year goal?
Write It Down
Every business starts with a dream. When you have one in your mind, don't let it go. Pick up your pen and start writing. You can always start with a simple sentence or a short executive summary, which you can reorganize and revise later.
One of the mistakes startups make at the very beginning is that they try to solve too many problems at the same time. A complex vision and mission statement could easily cause you to stray in various directions. Try to keep it simple.
No one is perfect. Same as your vision. Share your vision with your friends and family. See if your vision has logic and if it is achievable. Try to get feedback sooner rather than later in order to shape your plans better. (For more, read 4 Steps To Creating A Stellar Business Plan.)
Establish Reasonable Goals and Milestones
Starting a new business means you are running against the clock. "Setting meaningful goals and benchmarks early on is key because they will serve as your road map," says Tanya Prive, co-founder and COO of social network Rock The Post. "Goals need to be high enough to inspire you to push even harder, but they also need to be grounded."
Here are some tips when establishing your goals and expectations:
Don't Confuse Goal with Vision
Vision serves as inspiration and long-term heading, while goals help anchor the vision in reality.
Wear Various Thinking Caps
Challenge yourself and understand the reason behind each milestone. How do these milestones help close the gap between reality and vision? Is it the most strategic way of going about this? Is it achievable? Who do you need to partner with in order to make these milestones?
Be Clear and Specific
When you are defining your goal, your goal should include three basic elements. Those elements are what (i.e. a number or something that is quantifiable), when (i.e. time or certain date that is measurable) and how (i.e. ways to achieve the goal). One simple example is "By making calls to 1,000 clients, my goal is to make $100,000 in revenue sales by the end of the first quarter of 2012."
Pivot As Often As Needed
One of the single most important things as an entrepreneur of a start-up is to realize when the direction of the firm needs a change in strategy and having the ability to "pivot." Pivoting is crucial to surviving because as you grow and evolve, your goals and direction change. Be ready to adjust your strategy often in the early stage. (For related reading, see Reality Check: Why Startups Fail.)
An idea is only valuable when your company is addressing a need or problem within a specific market segment. Regardless of what type of business you are starting, it's important to focus on three basic elements:
1. Target demographic
2. Problem or concern your business is addressing
3. Knowing everything about your competitors
Market research is priceless. Be prepared to do plenty of market research before you start a business. Figure out what your competition's success and shortcomings are and know what makes you stand out from the rest. Keeping a close eye on the competitors is key because it will help you keep a pulse on the developments of your sector.
Here are some tips that will help you when defining your target market.
Search engines such as Google, Bing or Yahoo provide the most simple and powerful tools to start.
There is always someone to learn from. Ask friends, colleagues or experts who may know your market or business well. Ask them for insights, experience or even referrals for any further information. Also, you could always try to ask questions online by visiting websites like Quora and OSQA.
There are many local events around you that gather experts and professionals. By signing up for these business events or seminars, you will receive the latest industry report, meet the experts for in-depth discussion/analysis and broaden your social network connections.
There are many companies who provide dynamic, quick and affordable research solutions to startups and small businesses. Tools including online surveys, industrial report, price list, target consumer demographic distribution, consumer behaviors and so on.
Team Players Are Key
A strong team with diversified skills and experience is one of the strongest tools to have. If you want to make it big, you can't do it alone. The ironic thing about a start-up is that you have to do more with less. Picking people that not only carry their weight, but that are smarter than you is key. (To help you improve your business, check out Small Business: It's All About Relationships.)
Here are some tips that will help you when picking a winning team:
Use websites such as LinkedIn in order to assist you in finding people outside of your network.
Positive Company Culture is Key
Given that most start-ups don't offer much security, healthcare, pension funds or comfy corporate facilities, it is important that you create an incredible culture and sell the success vision of the company to your employees.
Start With a Small Group
More people working doesn't always equal increased productivity. Know what the needs and responsibilities of each position are, and select eager, ambitious, self-starters who enjoy the adrenaline rush that comes with working in a start-up.
Hire Fast, Fire Fast
It is very difficult to truly know what type of person you are hiring based off of a couple one-hour interviews. The best way of being certain if that new hire is a good fit is by keeping a close eye out within the first month or two. If you have a hunch that it won't work, follow your intuition. Someone that is not right for your company can cause more hurt than good as time goes by, not to mention it is an expense that is not justified.
The 3Ps: "Passion, Patience and Persistence"
"There is no such thing as an overnight success story. We spent almost 13 months to get the website launched, yet we still have much work ahead of us," says Prive.
Without a doubt, you need to be passionate, patient and persistent. It takes time to transform a brilliant idea into a brilliant business. With all negative feedback or opinions you receive, figure out why they are saying that, and if justified, find a way to address that problem. When you start a business, it is so easy to get distracted by the day-to-day rollercoaster, which can bring you further away from your original reason why you started the business in the first place. Write down your vision, mission and value statement, even better if done with your entire team, and make a huge print out so it serves as a daily reminder.
The Bottom Line
The most important thing is to educate yourself. Rome wasn't built in a day. It takes time to build your empire. For beginners, there is a steep learning curve that you need to embrace and climb fast. Get your hands on every relevant book you can find and indulge yourself in the subject matter. Be the student and teacher at the same time. (For more help with your business, see Keeping A Small Business Afloat.)
Know Your Market