Five questions you need to ask – whether you are starting a new business or running an existing one
We’re celebrating 25 years in business this year. With that said, I was reading some blogs that gave tips for starting a small business. As I read the lists of practical ideas and questions an entrepreneur should be asking about his/her startup, I started applying the thoughts to our own business. And that’s when I realized it.
The biggest mistake an established business can make is forgetting how it behaved as a startup. Yes, there were obviously those stupid mistakes we made out of ignorance and inexperience, but when you are working on a shoestring, as many of us did, there was a focus, energy, a sense of determination that got us past any bumps and roadblocks we hit. We knew what needed to be done – ok, maybe we didn’t always know how we were going to do it – but we sure knew what we wanted the results to be. And we kept moving forward and dragging our supporters with us.
I just find it so interesting how easy it is to get comfortable with your success. The energy is there – but it’s different. And the “why” we are here gets blurred in the day to day rituals and situations we deal with on an ongoing basis.
I started to read the tips and questions, then applied them to our own 25 year old business. Here are some of the questions that entrepreneurs need to ask themselves before starting a business. And I will add, operators of established businesses should be asking themselves these same questions:
Are you solving a problem?
Often I see a company marketing something that they say is a solution to a problem and then start inventing problems as a rationalization for their product or service. If you aren’t helping people by improving some facet of their life, nobody will be interested and even though there may be an initial surge in business because many people are gullible and believe advertisements, it’s just not sustainable.
Are You Improving an Existing Solution?
Many successful companies weren’t the inventor of a product or service. They took an existing idea and made it better in some way. If you’ve figured out how to make something better so it provides a better value for your customers, is it improved enough to entice people to switch over to your product or service?
For existing businesses, are you making changes just to make changes? Or worse, are you NOT making changes because things have gone OK for this long, so why upset the apple cart?
Make Sure Your Business is Viable
What does that mean? For a startup, it means you need to make sure your business can even work before it can be successful.
- Who are your customers?
- How big is your market?
- Who are your competitors?
- What makes you different from your competition?
For an existing business, you need to ask those same questions to make sure you haven’t lost your focus and are paying attention to your core markets and customers. It is so easy to get distracted with new, fangled ideas or opportunities that really don’t match “why” you are in business.
I remember when our company which leases and sells modular buildings was presented with the idea of becoming a “one stop” shop. We talked about the possibility of selling EVERYTHING someone would need in a building – copiers, coffee makers, refrigerators, paper, even paperclips! There was a lot of discussion from those who believed this was a great supplemental business for us. We finally decided that was not our core mission and politely turned down the opportunity.
Test The Market (shoot the bullet before the cannonball)
The greatest piece of advice I would ever give an entrepreneur starting up a new business is to test the market at a small scale before jumping into it. At Wilmot, we call this “shooting the bullet before the cannonball.” It can better help you understand what will work and what won’t without using too much of your resources. You can study the reaction of your potential customers, understand the resources that will be needed, the problems that can arise and help you develop a better system of processes.
More important is for an existing business, which frankly has a lot more to lose, to use that philosophy. Before building thousands of widgets, test the market with a small sample. Before developing a new process for your whole corporation, test it out on a small division. After studying results, make your revisions and then roll it out on a bigger scale.
Are You Willing to Stand Out?
Every successful business that is considered to be the leader in its industry, is managed by people who aren’t afraid to be different, or criticized by the mainstream. They thrive on being able to stand apart in some way from their competition.
It is easy for a company to fit in with the pack. They are fine with doing what their competition is doing, as long as they can get by. But if you want your company to be considered a leader, you have to be willing to be a lone wolf. Be smart about it by using the tips described above, and don’t be afraid to take the steps that make you different.
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