Deciding to start your own business can be very terrifying. This is because entering into a business on your own is such a great risk. You risk losing all the money you have invested in the business if it does not go as planned and there is no certainty that your product will be received with open arms.
The problem is that people do not plan and think through what they intend to do before executing it. Once your business has been profitable and begins to grow, expanding the venture becomes necessary. But business expansion isn’t always as easy as buying more space or hiring more employees. It’s possible for things to go terribly wrong if you don’t have manageable growth. So let’s take a look at some ways to make sure that your expansion goes smoothly.
Be Prepared to Double
Take a look at your business and ask yourself a very simple question: “What would happen if business doubled?” Have an answer? Now what would happen if that number doubled? Most likely, the answer to those questions are not “we’ll just keep on doing what we have been doing”. Most likely you will need more space, people, product, and time to handle the sudden demand. Are you prepared for that kind of explosion?
It’s so tragic to see a business that becomes overwhelmed when demand suddenly spikes. You may want Target or Wal-Mart to order your product to put on their shelves, but how ready are you to ship that order?
When operating your business it is imperative that you be prepared to double. If you need an extra 200 sq ft of extra warehouse space, get 500 sq ft. You want to encourage growth not restrict it. When you are overwhelmed with business and you let your clients know that you cannot deliver demand, all they hear is “no thanks, we don’t want your money”.
Don’t think “Product”, think “Product-line”
Be prepared not just to develop a product but a product line. If you have an idea for a skin care product that contains a rare flower found at the top of some mountain in South America, be prepared for copycat products to emerge. You need to be one step ahead of the game in order to maintain your competitive edge. Maybe that rare flower can be turned into a lotion, shampoo, or fruit smoothie.
Being an entrepreneur requires you to come up with a new product or service that is not being offered by anyone else. This can be a challenge considering that tomorrow your product may not be so new. In fact, there will be several similar products to yours.
Master Market Penetration
There are several strategies you can use to develop your business in order to make it more successful. The first thing you need is market penetration. This means that you have to come up with a way that your customers use more of your product. For instance, if you developed a new energy drink, start selling them in bigger packs other than the one you are selling. It might also help to make your product more versatile. If you sell it for one purpose, increase the number of uses for your product and you will sell more of it.
Another strategy is seeking alternative channels to sell your product. Do not be content with the customers you have. Be open to selling to other customers. This can be done by making use of channels such as social media networks. This allows you to reach more people with minimal effort.
Sometimes the way to get to the customer’s heart, is through their pockets. Lowering price is a way to increase your market penetration through price penetration. This is to be done very delicately, however.
Depending on the type of business you operate, lowering price may be a bad thing. If you have products that are presented as high quality or high end, then a higher price point creates a sense of exclusivity that will give those clients who enjoy paying more for a quality product a reason to purchase from you.
Last but not least, you need to utilize market development skills. This is where you sell your product in another market you do not sell to. It might help to sell in another state or country if possible. This increases your sales and develops your business. It also grows your business and exposes you to different types of customers which can be a great way to identify new opportunities.
Utilize Other People’s Time
Everyone has 24 hours each and every day. This is not a lot of time while you are in business since there are a lot of things that need to get done. However, if you are in business, one thing you need in order to succeed is extra hands and time. Hiring more help can possibly create more time in the long run. But, it will take time and capital in to train and develop those employees.
Businesses can earn in other ways that do not require continuing time investments. For a lot of companies, time in exchange for money is the common business model. Business owners typically fall into this trap when first starting the business and have a hard time getting out.
If you are still early on in your business, its not too late to start creating passive revenue from other sources. Business investment accounts can offer some gains if the company has a moderate risk tolerance .
But let’s say you aren’t ready yet to build an investment portfolio for your company. There are several other ways to drive revenue without expending your own energy and other resources. Here are just a few:
Licensing-Licensing your product is a great way to make some passive income. But, licensing is a very competitive space. Finding the right retailer is also important. Although this is a great way to bring some extra dollars to your bottom line, make sure it is a right fit, at the right time for your business.
Licensing expert and best-selling author of One Simple Idea: Turn Your Dream into a Licensing Goldmine While Letting Others Do the Work Stephen Key has licensed over 20 products that have been sold in 7-11, Wal-Mart, and Disney stores worldwide. He suggest that licensing is the best way to go since you do not need to quit your job or leave your core business to go the licensing route.
“Before you submit your product idea to any company, make sure to file for a provisional patent application. It only costs $110 to do so and will protect your idea for up to a year” he advises in his book.
Franchising-Helping someone else become an entrepreneur by franchising your business. It is imperative, however, that you have the proper systems in place to ensure the franchisee maintains the quality standards for your business.
In conclusion, it is possible to succeed in entrepreneurship. However, it is very important for an entrepreneur to have a good plan of their business before they execute it. This will make running of the business smooth and will also enable them to foresee some of the problems they might face in the future of the business. Offering unique services is also very important if you are to succeed as an entrepreneur since it makes you stand out from other business owners.