To start a business enterprise you need to have a detailed plan. To create a plan you need a team, a market, and an idea. An idea on which to base your plan on.
In the beginning, when I knew I wanted to start a company, I wasn’t certain of what idea would be a good idea. I wanted to create my own enterprise because I was on a university committee approving other students’ business ideas for funding from university and wanted to become part of that community of self-starters and entrepreneurs.
It’s hard to know you have a good business idea, but you can start by trying to find appropriate answers to the following questions:
- Is there a need for the product or service?
- Can your target audience afford your product or service?
- How will the company make an income?
- Do you have a unique selling point (USP)?
You need to find the answers for yourself, and you need to be able to explain these answers to your team in a way that they can fully understand and get on board your idea.
Creating a startup can be a challenge and sometimes lonely experience, so it is always nice to start with one or more business partners. I started my startup company with a colleague from the committee I was on. I wanted to work with someone interested the same kind of technology that I enjoyed working with, but had key skills that were different from mine. Once we formed a business partnership and we had an idea, we started creating a business plan to present to the university committee and other potential investors.
When investors and business experts are reading your business plan they are looking for answers to the following questions:
- What is the problem your product or service is solving?
- Who is your market?
- How will the team deliver a winning business?
- Who are your competitors?
- What makes your startup company better than your competition?
- What are your USPs?
- How difficult will it be for competitors to copy your business and USPs?
- How will you make money?
- What are your ambitions for the business?
- What do you need for your team to deliver a winning enterprise?
The business plan is not set in stone, it is a living document that should be reviewed regularly throughout the lifetime of a business, and used as a guide to remind you of how you wanted to achieve the goals of your startup. You’re allowed to change your mind about the direction you’re taking your business and how you’re going to get to your new goal, as well as your existing goals.
Our original business idea was to create a platform that would help small retailers increase their sales. The key feature of the product was to give small shops and retailers business an opportunity to create sales during the quieter periods of the day. We began preparing to present to potential investors by researching the market, our target audience and competitors. This was by starting to write a business plan and business pitch.
I have gained a lot from the experience of starting my own business for the first time. Knowing the answers to the questions listed above and having confidence in your answers is vital, as they are the questions you will be asked time and again when you are trying to raise funding for your project. Having confidence in your idea is almost half the battle.
If I were to decide to start a new enterprise, I would look more carefully at my target market and identify my target audience more precisely. That would help me build a better plan for becoming a dominant player in my chosen market segment. To do this I would build customer profiles, and use sites like duedil.com to gather more information about companies I want to work with and companies I would be competing with.
Reviewing your business plan regularly is another important thing to do. Even though the plan may only give quarterly projections, you need to derive your monthly, weekly, and daily tasks and goals from. You can also use the business plan as a yardstick to see how well you are doing at reaching your yearly or quarterly goals.
In the short term, you may be able to get away without knowing exactly what you are doing in your enterprise. But the longer you stay unsure of your final goals the less prepared you will be to face the music (and interrogations) when you launch your company, and a lack of preparation could cost you dearly.
In the next part of the series I will talk about How do you get potential customers, potential investors and potential employees buy in to your business.
- Part 1 of 4: In the beginning, where do you start a startup? (thestartupmag.com)
- Part 2 of 4: How do you get others to buy in to your business? (thestartupmag.com)
- Part 3 of 4: how to prepare your business for the first day of work (thestartupmag.com)
- Part 4 of 4: Now start running your business (thestartupmag.com)