You have your business idea, maybe even a rough framework in mind as to how you want to bring that idea to life. The time is now. Sit down and really understand what you want to achieve and how exactly you plan on reaching your goals. Without this initial phase of self-reflection and objective setting, you’re almost stepping out in a foreign city without a mapâ—âyou may speak the language, meaning you may already know the sector you are launching in, but that doesn’t necessarily mean you will get to your end destination, on time or in the form you desire.
Not sure where to start? We’ve taken a look at how to evaluate a few macro areas that may influence the success of your business, and how you launch it. It is by no means exhaustive, but can give you a good foundation to get going.
How well do I know my sector?
You’ve got a business idea for a reason, you may have seen an opportunity to a gap in the market, but you need to confirm this by digging into some numbers about the sector. Let’s say I wanted to source local jewellery and clothing from my contacts in Turkey and sell them to boutique in London, where would I start? I’m not planning on directly selling these to an end user, so I need to understand the demand, the distribution change and business model, consumer trends and preferences, amongst other dynamics. Before anything, I need to identify a demand and opportunity in London for these kinds of goods, and if I find that the market is already saturated, then it won’t be a business idea worth investing in. If I am able to purchase directly from the wholesaler in Turkey, then I can sell this directly to the boutique in London, a point which will influence my sales price and the final consumer price. I have no physical store costs, but on the other hand, I also have logistics and exportation costs, so I need to fully understand how I can execute this and learning more about how it is already being done in the sector will point me in the right direction.
Can I beat my competition, now or in the future?
The traditional SWOT plan to analyse your strengths, weaknesses and existing opportunities and threats, was developed for a reason. It is important to understand your position relative to others in the market, whether direct or indirect players. In the above jewellery example, I need to understand where these boutiques are currently sourcing their products from and what the relationship is like, would they be willing to buy 10% of goods from me and less from my competition? Can I offer something different to what my competition is offering? Maybe only one of my competitors is working with local designers, I can benchmark and consider building a wider, select range of products. I may even choose to expand this to artwork if there is a demand. This will then help you determine what your Unique Selling Proposition (USP) is.
Key questions to ask yourself are:
- Are there large players with a significant market share or is there sufficient room for to take part of the pie? What can I learn from my competitors in terms of successes and failures?
- What are the price points I need to be within, can I compete with this?
- What are the key sales channels?
- Are there any opportunities coming from outside the sector which have not yet been seized?
- What are my strengths and weaknesses relative to my competitors?
Do you understand your audience and their needs?
Your target audience should be based on all the questions and answers coming to light through the above, which should point you to the target group where the most opportunity lies. This definition should then be the driving force behind your marketing and communications outreach. Map out who your target audience is, what their characteristics are and the kind of activities they engage in. How does your product or service fit into their lifestyle and what will compel them to purchase it? Look at their preferences, what their geographical distribution is and their media consumption habits, while your marketing channel options are clear, you should understand what your touch-points will be.
My primarily sales channel(s) will be…?
If you own a physical space, you need to consider your shop layout, visual merchandising and how you will bring traffic in, while a business like a consultancy is more focused on the services you provide, so you need a mechanism to explain what you offer and your USP. Deciding how and where to set-up shop means developing a business presence that supports your sales channels, whether directly or indirectly and creating a website is part of telling people who you are and what you do.
Based on the above, you should have enough information to set clear objectives and guide you in achieving them, but don’t forget to keep checking back in to see how the market landscape and dynamics are changing and how it is impacting your business.
Now is your chance to start on the right foot!
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Originally published at thestartupmag.com on May 9, 2016.
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Chief Engineer at MarketHive
L Basheer (LB) Hasan – TheGoldServants.Com