Archive for September, 2008
Why start a small business?
There are many reasons to start a small business. But one reason shouldn’t be just to make more money. At least, it shouldn’t be the main one. I believe that the two important elements to start a successful business is to a) offer services or goods that people want and b) being able to identify people who can buy these services or goods (i.e., there is a market for the services or products you want to offer).
For example in technology, an entrepreneur may have in mind a very nifty idea that could turn into a revolutionizing technology but technology in itself is not a product or a service. The question is what products will be derived from that technology. Part of the problem is that in general, entrepreneurs don’t want to limit their markets at least in the beginning. The end result is that they may be overreaching which leads to too many products or services or ones that are not well defined. My advice would be to keep it simple at least in the beginning. Focus on the service or product that is likely to be most successful. You can always offer more products or services later after you have made your mark with the first one.
Another element that is equally important is to be able to find buyers. Often, there is no list of buyers available. For example, if you come up with a better X-Ray equipment, while you may know that hospitals will find the services useful, this in no way tells you who in the hospital can make the decision about buying your equipment. It may be a hospital administrator, the chief radiologist, a third party to which the hospital has outsourced its radiology services. (Note that I know nothing about selling to hospitals; this is simply an example). The bottom line is that a lot of research could be needed to find out more about your market. My one sentence advice is to focus on the portion of the market that need your service or product the most.
Finally, I believe that another key ingredient that helps to start a small business is to have the passion for what you want to do. Running a small business takes a lot of energy. If you don’t have the passion that will help you put in the long hours that are required, stay out or at least wait until you have such time.
AyiPreneur 