Questions Every Entrepreneur Must Ask Themselves to Ensure Success
Now is an exciting yet challenging time to introduce a new product or service. Thanks to the continued growth of the internet, entrepreneurs have direct access to end users while more established distribution channels continue to operate allowing for a wider range of potential sales.
The old adage of the 5Ps, Prior Planning Prevents Poor Performance, is even more relevant today realizing that many new start-ups will fail. Here’s a checklist of important business questions every entrepreneur must ask themselves to ensure success.
1-Do You Know Your Product, Potential Market & Competitors?
How big is the market for your product and service?
Is there competition and have you analyzed them?
What is the WOW factor of your product/service and is it strong enough to enter, gain and sustain market share making it a viable venture?
Why are you unique and what makes you different?
2-What is the Distribution Channel?
As the creator of a new product or service you may be focused on the end user, but there may be other distribution channels that you need to pay attention to.
Are you planning to sell through them or direct to the end user?
Do you really know your potential customer(s) and understand the issues and challenges they face?
Do your pricing, packaging, terms and conditions fit their needs?
Could special certain conditions have a major impact on your company as you roll out?
3-Have You Done Your Research &Test Marketing?
Have you tested your product or service to the end user and have you gotten good feedback?
Do not Beta test your product/service in real distribution, make reasonable adjustments based upon solid feedback but also know when to move forward. Striving for perfection is important but there is a balance of knowing when to start and make improvements/upgrades later.
Be sure to legally register to protect all intellectual property and make sure you are not in violation of any. Do the same to identify governmental regulations that you may have to comply with.
4- Do You Have a Profitable Business Model and One That Provides a Continuous Revenue Stream?
As obvious as this may sound, make sure you have developed a profitable business model capable of providing a continuous revenue stream within a reasonable amount of time and make sure your investors are aware of that timetable.
5-Do You Have a Clear Vision of Who You Are and What You Do?
You must be able to clearly, concisely and convincing identify your unique values in the marketplace.
If you are using a branding firm be sure they thoroughly understand your product and service so they can effectively help you build that message.
6- Have You Developed a Strong Infrastructure?
You should develop a 36 month plan that takes your company from start-up to market introduction through the initial growth phase. Questions and issues to consider are:
Do you have enough start-up and initial operating funds?
If you are introducing a product, what is your plan to produce yourself or outsource? Do you understand all requirements and conditions for in-house production?
If you outsource remember to establish clear quality standards and testing requirements working in the metric system to avoid variations and/or tolerance adjustments. Develop a strong relationship with your manufacturer, and have agreements in place so that your manufacturer doesn’t become your competitor. Remember certain agreements may not be enforceable in some countries but check first.
-INVENTORY MANAGEMENT/SUPPLY CHAIN
Can you deliver consistently high quality, on time, every time?
In your 36 month plan, include details such as location needs (office and warehouse location and size), insurance, staffing, computer hardware and software. Plan 2 or 3 scenarios, so that you will be prepared for potential upcoming costs and capital needs at various revenue levels.
Make sure your sales team is fully trained and thoroughly knows the product/service. Also remove as many potential barriers as possible and in advance so they can close sales. Strong and passionate belief in the product is crucial.
Do not over commit yourself and realize how important it is to remain liquid and flexible.
Do you have the correct accounting system and financial controls in place?
Attention to detail is so crucial in the start-up, market introduction and initial growth phases of your business. Mistakes and poor planning will deplete valuable capital that should be being used to fund your growth.
7-Do You Have a Great Team of Employees and Advisors?
Remember that you can’t be proficient in everything in every area, be sure to have someone (not a friend or family member but a professional) to bounce ideas off of and who can advise you.
Finally, as you grow, be prepared to hire great people, train and lead them. Don’t stand in the way of your own success by micro managing and not clearly communicating. Avoid what has been commonly referred to as “founder dysfunction”.
Larry Sussberg has worked for large and small multi-national consumer products companies. The past 15 years as an entrepreneur acquiring and starting successful consumer product and service firms.He currently resides in Charleston with his wife and operates a small consulting practice.