When you're watching other people play Scrabble, it's easy to see ample opportunities to place tiles and score more points. But, when you're actually in the game yourself, it can be harder.
This is exactly what happens to new entrepreneurs. Often, they have many business ideas but lack the capacity to understand the risks, experience and time associated with startup success.
The big question is: What should new entrepreneurs know before launching their businesses? There is no complete answer to this question, because some things will affect some businesses and not others. But, here are five questions you definitely should ask yourself when trying to start a business.
1. Why am I starting this business?
People start businesses for various reasons. Some do not want to take orders while others are tired of the 9 to 5 work day. Still others just want to join the bandwagon and make some money.
If you're starting your business for any of these reasons, you're probably going to fail.
Instead, you should have a purpose for starting a business. For instance, I set up a business research consultancy firm in 2014 because I feel people in my locality lacked practical knowledge of business plans and feasibility studies. I launched my business to meet a need, and I have profited from it.
It's crucial to thoroughly examine any initiative you wish to launch. This is because you could be faced with many business ideas. Just be careful not to lose focus. With each new idea, sit back and think through the pros and cons, then launch.
Noah Krinick, founder and partner of Solo Rugs, said, "Every entrepreneur should be able to answer the question, 'Why are you doing this?' It seems like a simple question, but there will inevitably be times when things go wrong, hope is dwindling and you need to remind yourself of why you're in it. As an entrepreneur, building and growth is a process that never fully ends. It is great practice to give yourself a mission statement to maintain focus on the project goals as well as personal ones."
2. What is my target market?
Knowing your target market is very important, since your sales and profits hinge on it. Remember: If you target everyone, you're targeting no one. You need to focus and identify your target audience by carrying out a market survey.
Reach out to your prospective customers by sending out questionnaires or directly speaking to them. By doing these, you can provide a product or service people really want. In an email interview, Sarah Brennan, fashion expert at Clothingric, said, "A business's focal point is the target market. If you don't have a well-defined target market, then, you scramble for everybody in the market. Just know that everybody can be nobody."
3. What is my digital strategy?
Nearly half of U.S. small businesses don't have a website. The contemporary business world cannot thrive without digital technology. In our contemporary world, clients and customers are going digital. The conventional methods of sales, marketing and delivering goods and services to clients and customers are phasing out. Clients and customers are now yearning for more efficient methods of buying products and services.
It is easy to manage business nowadays. By engaging in digital marketing, you can reach out to billions of prospective customers all over the world. You can also automate some of the business tasks using sophisticated software. You can start with Apptivo which can allow you to do everything you need in one cloud solution.
4. What goes into my business plan?
Some people believe writing a business plan is only necessary when you're seeking outside funding, but a good business plan actually indicates whether a business is feasible or not, breaking down its strengths and weaknesses.
Write out your business plan. Detail the financial, operational and marketing.
Venturing into a business is a choice. Our choice today determines our result in the foreseeable future. Thus, all planning should center on your business plan, so you can avoid surprises later.
5. What are my competitive advantages?
Customers will patronize your goods and services if you offer something better or different from your competitors. One important thing to do when you are launching your business is to deliver what your customer wants and not necessarily what you want.
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This article originally appeared on Entrepreneur.com. Minor edits have been done by the Entrepreneur.com.ph editors.