Whether you are going on a short trip or a
whirlwind tour, having an idea of where you are headed and how you will get to
your destination seems like a pretty good idea. This is equally true for people
aspiring to start their own businesses. For many business people, the
development of a business plan provides
a road map to get to your destination,
but they can be a little daunting to consider or develop. There are a lot of
resources available, but where do you start?
SBA.gov is a
great start for getting a little background and beginning to form your ideas. The
SBA
website shares loads of information for potential, developing, and
established businesses. But before we go there, we need to step back a little.
. .
Before the Business Plan, Plan the
Business
Every year
thousands of businesses fail for a variety of reasons. According to the SBA,
lack of experience, insufficient capital, and the lack of operational skills
and practices are among the major reasons. EricWagner, self ascribed serial entrepreneur, says that an entrepreneur may
see an opportunity in the market or have
a wonderful idea that they are sure people will love, but did they bother to
stop and ask the market? As you know, great ideas come and go. Have you ever
heard of the flying tank or the portable record player?
I suppose that
was designed to vacuum out the inner beauty?
Most people
never had heard of any of these. These are examples of great ideas that did not quite capture the attention of the masses.
Everyday businesses invest money into research and development in the search of
the new, better, faster, more convenient, and most desirable products for the
market. Some products are selected and developed and some go by the way of the
vacuum helmet.
This is not
meant to discourage you, but being a successful business person requires first doing a
little honest brainstorming. Ask
yourself some important questions before you put a lot of time and effort into
a product. . .
What is the need that I am attempting to
fill?
If customers do not have a need for your product you will not have
sales. Need can be generated or motivated, of course. That is what marketing is
all about. (Remember the Pet Rock and the Rubik's cube?) In marketing we attempt
to teach a customer about a product that will fulfill some need or compel them
by emotional responses (more on that later). However, if the product is simply
not good or is not easily marketable, it may not be worth your effort.
If I discover a need, have a good fit for
the need, and people like the product, why will they buy my product?
There are a lot of products out
there. What makes yours unique? How will you differentiate
it, your brand or your method to encourage people to choose you? Will you
be just one of the masses of products or will yours be the one that people look
for?
On
the website PowerHomeBiz.com, the author mentions some keys to successful
differentiation (which is synonymous often with keys to sales). Knowing your potential
customers and their needs is the start of product design and development.
Once
you are as big as Apple® or Microsoft® you can be the one
to tell people what they want, but plan for a much larger R&D and marketing
budget to do it.
The lesson: If you think you have a great product, you should be excited, but make sure you
know and understand your potential customers. Make sure you are not the only
one who will be excited about your product.
