Last month, we touched on some of the things you need to think about when setting up your business.
Let’s explore the viability of your business idea in more detail. In other words, how realistic are your chances of survival in an era of innovation and disruption?
If you are reading this, it’s likely you already have an exciting idea you want to convert into a successful venture. As you are deliberating, based on our experience and dealings with start-ups, we would like to give you a few pointers to make sure you are not overwhelmed by surprises on your journey.
Have you looked at the possibilities of cost over-runs?
You may be surprised how quickly costs build up in a business – rents, rates, taxes, depreciation, legal, insurances, licences, marketing… the list goes on.
To have proper control and visibility, we suggest you take a hard look at all your possible costs and keep in mind Murphy’s law “Whatever can happen will happen”. It’s wise to work up two cost scenarios in your plan – one optimistic and the other pessimistic. This will help you correctly price your product or service, and compare it with your competition and what your customers are willing to pay.
Do you have a back-up plan?
In the current business environment, agility is key. Not all ideas succeed. As an entrepreneur, you should be able to identify your business health indicators quite early on, and be adept at adjusting your strategy in the case of negative signals, before it is too late. This could be a new product, new idea, new opportunity. Keep an eye on an emergency exit plan for your business too.
Are you prepared to scale up?
A good idea can soon click and take off very quickly. You should aim for such success and make sure you are able to service that demand.
We recently spoke to a successful take away owner. She started from her kitchen and a WhatsApp group, but is now finding it difficult to meet growing customer demands. She is thinking about how she can service outside her local area, how to train chefs who will maintain the same quality and how to raise finance to move to a bigger kitchen. A rapid scale up strategy will help answer those questions and if you think beforehand, you will never have to turn away customers.
Keep referring back to your business plan
Evaluate, simulate and consider possible changing circumstances. Ask questions like – What if my raw material is suddenly unavailable? What if my key distributor fails? What would we do if new trade barriers are implemented? Prepare in advance rather than having to react in haste to challenges.
We are here to make your business into a successful and fulfilling venture. We work as your business partners, because your growth means our growth.
If you would like help with pricing, or modelling aspects of your business, please contact us on 01256 406 601.