It's the perfect time to 'spring' into a new business
Before you launch your new business, make sure you do all the proper pre-planning necessary
Spring is the season of new beginnings. Flowers bloom, trees bud and many of us tackle some sort of "spring cleaning." With so many things growing around us, spring can also be a good time for other new beginnings. If you have a business idea you've been considering for a while, this spring could be a good time to begin.
The first step to successfully launching a business is to have a solid business idea. Identifying a need in the market and offering a solution is the foundation of a good business. Once you have a kernel of an idea, the best thing you can do is vet it with potential customers. Ask them if they would buy the product or service you want to offer. Ask them what they like and don't like about your idea. By getting this information early on, you can refine your product or service before spending time and money building a business that may not have any customers.
"A startup strategy needs to be calculated, questioned, validated and be defensible, before moving forward with another step or another dollar," Matt Westfield, entrepreneur-in-residence in the Ozmen Center for Entrepreneurship at the University of Nevada, Reno, said.
To validate your strategy, Westfield recommends testing your product or service in a hypothetical way.
"A survey with a few key questions is a great start," he said. "Getting 100 people to answer is a great benchmark; anything less than 25 is not statistically relevant and the more the responses, the better. This is a great step, especially if you are unsure about your business model or if you are creating something that may be complicated for customers to understand. "
Another important step in vetting your business idea is understanding the competition. For a highly specialized business idea, there may not be any direct competitors, but there are always other companies who are competing for the time, attention and money of your target audience. The product you have may be completely different than what your competitor offers, but customers could still be allocating their attention and money to that competitor. Consider products or services that are similar to what you're planning, but also consider the things that your future customers are spending money on right now. The thing your customer is buying now can be considered a "substitute solution" for the product you're developing. Knowing who your competitors are - direct, indirect and substitutes - and what they are doing will help you better define your target customer and how your offering is better than what your customer currently has access to.
As a serial entrepreneur and partner of the Nevada Small Business Development Center, Westfield offers great perspective on this, noting that entrepreneurs need to think about who else is doing this, either directly or peripherally. What values are your competitors articulating? In the competitive space, who is really good? Are they purporting to be faster, better or less expensive? They will never compete on all three and neither should you. Defining your unique position and differentiators is key to business success.
After validating the business idea and understanding the competition, potential business owners should move into the planning phase. This is where you will map out as many of the details as possible: where will you buy your supplies? How much do supplies cost? How long does it take to make each product? Will you have an online store or a brick-and-mortar location? What will you charge for each item you sell? Doing the research to answer these questions will mean fewer surprises down the road. There will always be surprises in owning your own business, but being as prepared as possible at the beginning will put you in a better position to handle any surprises that come your way.
Preparing to launch your business can be a daunting process. Fortunately, there are many resources available business owners and potential business owners to help with the process:
• Nevada SBDC offers free and confidential 1:1 business counseling to any entrepreneur or small business owner.
• Entrepreneurs Assembly holds monthly roundtable workshops for peer-to-peer mentoring and business assistance.
• SCORE offers access to a network of experienced professionals who act as mentors to business owners.
• Ozmen Center is the hub for Nevada students, faculty and staff to collaborate on new venture creation, regionally, nationally, and internationally.
These organizations also hold regular training events, networking opportunities and topical workshops to give entrepreneurs access to information they need to build and grow their business.
If you are thinking about launching a new business this spring, vet your idea, understand the competition and then work on planning out the details. And get help along the way from other business owners, from our team at the Nevada SBDC or from any of the business support organizations in Northern Nevada.
(Editor's note: Winnie Dowling is the Deputy Director of the Nevada SBDC. Since 1991, she has been working with small business owners to give them counsel on how to start and grow their business. Prior to joining the SBDC, Winnie was a business owner herself and uses that experience to help others "spring into business".)