Tweet

Starting a New Business

Guest post by: Jim Kayalar

Article Overview: Many new business start-ups fail. New business owners fail and waste precious resources. What can they do to avoid business failure. This concise six question list can help them avoid the business mistakes most unsuccessful commit.

Starting a New Business

The world economy is in a recession and it looks like it’s going to stay that way for some time. Millions of people are unemployed or underemployed and it looks like it’s going to stay that way for some time.

Entrepreneurial activity once conducted out of choice is now flourishing out of necessity as more individuals try to go at it on their own. And yet why do so many fail.

In all my years of business consulting and mentoring I have seen many businesses falter. One of the main reasons for business failure is that the business concept could not be translated into profit.

The acid test is “What happens after you have sold your Uncle George and Aunt Harriet and your friends”. Does your business concept have what it takes to sell to everyone else? Closely related is the question, can you reach those people economically and still turn a profit?

I ask these two questions time and over again to new business owners and am constantly assured. Here are some guidelines to help you succeed in your new business venture:

1. Define your business concept and what value it will provide to customers

2. What would customers be willing to pay you to obtain this value

3. How many customers are there that would be willing to pay you

4. How are you going to reach these customers

5. How much will it cost to reach these customers and maintain their business

6. Is there enough of a profit for you to go ahead Time after time I see individuals spend time and money on designing a business card, putting up a website, setting up a company and deciding on how to comply with financial reporting. Don’t spend time on administrative matters. These do not generate an income for you. Spend your resources on activities that will help you find paying customers.

Many new entrepreneurs overestimate their business concept and the value it provides to potential customers. Result: There are too few customers and the business either closes or has to supported with cash coming in from other activities.

The next biggest mistake is to forge ahead without knowing how many paying customers you can reach and make a profit. Result: There are too few customers and the business either fails or has to be supported.

Even if the business is not successful, many business owners choose to be in denial and keep the business open mainly due to emotional reasons and hope it will pick up in the future. Many get part-time jobs and keep the under-performing business with the hope of turning it around later. It usually doesn’t work.

Don’t waste your time and know when to walk away. Gather your resources and create an opportunity to start over another day rather than wasting time and resources on a bad idea.

Related Articles
  Starting a Work at Home Business in Canada
  Are You Ready to Work for Yourself?
  Starting a web based business
  Franchising Continues To be a Safe Way to Go in Troubled Economy
  Should you buy or start a business?
  Home Based Business Opportunity--Getting Started
  The Surreal Reality Behind Starting An Internet Business
  How to be Successful when Starting a Home Based Business on the Internet
  Becoming An Online Entrepreneur: Keep Your Fire Burning
  Why Starting A Business Is Recession-Proof
  Home Staging Offers Job Security
  Home Based Business Opportunity Can be the Best Decision for you in Tough Economic Times
  A change of direction with a Franchise Business
  Top 10 Tips to Starting Your Business
  Advice for New Entrepreneurs And Business Owners
  Top Tips for Women Setting up in Business
  Aren't You Tired of Working For Someone Else?
  Meeting People Where They Are
  Start your consulting business as a side hustle
  Starting an Internet Home Business Tips

Article Tags: business failure, business help, new business, under perfroming business



Related Forum Posts
Business Innovation - Hi Simon If you can finish off the Business Plan and think about your strategic direction or how you are going to use your product to convince people it's a great idea, it will set the foundation for your programming project. You see, when you are looking for funding you will need a Business Plan and Strategic Plan that will convince companies to invest into your new idea. Has anyone achieved this idea before using another industry besides health and fitness that you know of? You should also design some mockups as a "preview" for your programming project. This will also help reduce your programming costs as everyone will know exactly what you want if you have detailed mockups already completed including any functionality you require. Starting mockups for websites and software applications on paper is the best way if you're not a guru in graphic editing software.
My entry - 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read - this is a fascinating book about the history of Business theory, and I'd recommend it to anybody. 2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto. 3. PADI: The Business of Diving Book Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
Re: Moderators on vacation - Hi Everyone, I will be away for the next 4 days. Starting now.
Exclusive: Interview with Results - Hi Forum Members, I'm helping start up a Business Coaching and Consulting company here in Toronto, Ontario, Canada (a Subsidiary of RSC Business in Los Angeles). As a Research and Development Intern I am required to practice my listening and interview skills by surveying Small and Medium Businesses on thier Business. This Survey is designed by RSC Business to also assist the Business being interviewed more insight into their own business. I am looking to interview about 30 businesses across North America over the span of 3 months. At the end of these interviews I will be publishing a report of the results and they will be made available for free to the Interviewees. The Report data will include responses from a minimum of 100 interviews. I would like to extend this opportunity to members of the Forum. If you would like to have this short 20-30 minute interview conducted on your Business and you reside in North America please send me an email or PM. Please contact me at andy[at]jvprosperity[dot]com to arrange our interview and to get free access to the results when they are published.
Re: HOw to market a B2B consulting company - [quote="zohahunt77":428owzbi]Hi, I was wondering if anyone can tell me the difference between B2B and B2C. I don’t know about b2b marketing but I have done marketing so know things about it. I will suggest you to take online services which will spread your business all over web network. Online marketing is the best way to market any business.[/quote:428owzbi] B2B = Business to Business - You are marketing to other businesses. B2C = Business to Consumer - You are marketing to consumers.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Pay Per Click Advertising

Providing Feedback

Marketing & Sales tools – going back to basics

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.