How to Get Started: Planning
So you have a great idea for a product or you want to offer a service to a niche market but don’t know how to get started?
Once you have an idea for a business you need to figure out how you’re going to execute that business. The ten steps below will guide you.
To develop your idea into a business you need to answer the following 10 questions.
1. What is the purpose of your business?
You have a great business idea but what will that idea be used for? You need to state clearly why you are starting this business and what you hope to achieve.
Let’s say you have an idea to create an organic nutrient water. At first glance the purpose of the business is to be an environmentally conscious beverage manufacturer. But are you starting this business to help improve the health of your customers and/or the environment? This question is important, as it will structure your business strategy.
2. What products or services do you provide?
At first glance this may seem like an easy question. But today the product or service also has to provide an experience for the customer.
Using the example of the organic nutrient water, you must figure out the various nutrient mixes of the water. Will there be one that focuses on energy, stress relief or brain focus? What other product can you provide other than water? Maybe green juices or fruit smoothies with the same nutrient profile? Again the answers to these questions will structure your business strategy.
Startup tip: Just focus on the initial product or service but keep your ideas in mind for future expansion possibilities.
3. Who is your customer?
Your customer should be someone who needs the product. Often we have a vision of our perfect customer but that customer does not need the product we provide.
With the organic nutrient water, is the customer someone who is already healthy and getting the daily nutrients needed from their food or is the customer a person who does not eat enough fruits and vegetables, but wants a healthy dose of nutrients at 3pm to stay awake at work?
4. What does your customer want and need?
Your customer has an issue that you’re going to solve. Figure out the core issue and provide a solution that directly helps your customer.
Is it winter and everyone is a little down and over the drab weather? Maybe your organic nutrient water will provide the boost of energy needed to face sunless days.
5. How will your product or service benefit them?
A benefit to your customer can be direct and also indirect. The direct benefit must be clear for you and the customer to see, while the indirect benefit should be clear for you to see but one that your customer isn’t aware of but will thank you for when it is noticed.
So the direct benefit of the organic nutrient water is that your customer gets 100% of the daily recommended vitamins and minerals each day. The indirect benefit is that the customer saves money on health care costs because he goes to the doctor less or is more focused at work.
6. Who is your competition?
You should identify the key companies in the industry. The key companies are the big corporations and the small businesses current and future. Many people focus on the big corporations but forget about the startups until it’s too late.
There are many companies that provide vitamins to customers. From vitamin pills to nutritional powders and vitamin waters. Figure out your niche and focus solely on that segment of the market.
7. How will your customers find out about your product/service?
Brand awareness is a very important step in launching a new business venture. This is often developed in a marketing plan. Today we are fortunate as the Internet makes marketing possible with little money. However, this type of marketing requires money or time. Your marketing plan should cover the mix of money and time you will use to build awareness about your product or service.
For the organic nutrient water your marketing plan may start with an Instagram account, which shows people using the water in their day-to-day life. This plan may also include local farmer’s markets and festivals as a way to have customers try your product and then write reviews about it on social media.
8. How will you manage your business?
What is the organizational structure of your business? Is it just you or you and your family? In most cases a startup is launched solo or with a group of friends or family. A structure must be in place for decision-making, organizational roles, and expectations.
Say you’re launching this water business on your own, you need to determine what tasks you can do on your own and which can be outsourced either with temporary help or part time employees. Many entrepreneurs try to do everything themselves and that’s perfectly acceptable. Just realize that is again a trade off of time and money. If you’re doing everything yourself, you’re saving the costs of paying for help but it will take you longer and it may not be done well if you don’t know what you’re doing.
9. What are the financial goals and estimated costs for your business?
How much will it cost you to launch your business and how much do you need to make in order for this to be a business and not a hobby? These are personal questions based on your situation and goals.
To launch the water company you will need to be able to produce the water and secure a supplier for the bottles, ingredients, and labels.
Based on these expenses as well as the expenses for marketing, business development, and salaries you will determine your financial goals for your company.
10. What is your business strategy?
The answers to the questions above will structure your business strategy. Business strategy is about taking actions that have short term and long term objectives in order to achieve the overall mission of the business.
Let’s say your business purpose it to provide organic nutrient water because you want your customers to be healthy. Your business strategy will focus on things your company can do to make your customers healthy. Let’s look at the bottle design. You may have a glass bottle instead of plastic and a label that has healthy lifestyle tips. Your focus in marketing may be on currently healthy individuals or those starting their fitness journey. And your business name will provide a clue to your business purpose or be uniquely catchy.
If you’re having trouble answering these questions here’s my advice.
I recommend that you answer these questions in one sitting. Then save the answers and don’t look at your answers until 2 days later. When you review your answers you will see new ideas and answers begin to flow. Don’t stress just do the work and you will figure out the plan you need to launch your business.