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For those with experience, I have several ventures I would like to try. All are low cost, I think solid ideas, but all in different markets. I was thinking about pursuing each one with a partner.
Do you think I would be better off just focusing on one business, or trying multiple businesses with partners and see which one sticks the best and then focus on that one. I have a feeling most would say focus on one. I would be doing either approach while still maintaining my full time job, in yet another field that has nothing to do with any of the ideas I want to pursue.
Let me put it this way. Would you have one spouse or several? A business is that way. It is an all-consuming beast, one that will consume your thoughts and energy. Trying to divide your attention among several means you won't run any of them very well at all.
In fact, I would say that focus is probably the key determinant of success, both in your mental energy and in the positioning of your business. One of biggest challenges I face with counseling small businesses is that of keeping their objectives simple and working their business plan relentlessly. Because entrepreneurs tend to be a bit ADD anyway, they want to move on to fresh and exciting realms as soon as they've mastered the fundamentals. So you'll hear them say things such as, "And we can sell this to that market, and to that market and to that market," even when they don't have anything close to market share in their core business.
So don't even think of having multiple businesses. It's nothing more than a costly diversion, one that keeps you from making any single one of them a success.
I developed a business plan, which by itself does not guarantee success, of course, but it will give you a leg up.
The most important thing I did was research, research, research. Whether my area could use another professionals dog walker, where the heaviest dog-owning neighborhoods are, what the going rate for dog walking is (I charge slightly more; never less!) what the average income of various nearby neighborhoods is, and my costs-per-walk against potential income. Leave as few mysteries as possible for yourself.
Two of the most important lessons I learned in entrepreneurship class:
1. Your competition has already done the research on market rate for you. They've already figured out what rate they can't go below. So why would you charge less? Respect that, and charge the same or more. Don't fall into the trap of thinking that potential clients are going to go for the cheapest service/product out there; that only leads to a race to the bottom.
2. Do not cut deals. You're a professional; there's a level of implied self-respect there. If you ask a roofer for an estimate, he's not going to look over your roof, tilt his head weakly, and say, "wellll, for you, I guess I can go....ummmm, a few hundred dollars cheaper?"
3. Oh, and a personal pet peeve; don't phrase your statements like a question; meaning don't use an upward inflection when you talk. State your price. Be forthright, not weasel-y. Your clients will respect you for it.
Good luck in your adventure! The world needs many more entrepreneurs.
I agree, know and appreciate what you are worth.
People will always try to negotiate price but don't compete on price. It will show in your work and your reputation.
Its a repeat customer type of business, recognize that there will be high maintenance customers. Spend your time wisely doing an excellent job but know when to lose high maintenance customers, they will cost you more in time and aggravation than they are worth.
I developed a business plan, which by itself does not guarantee success, of course, but it will give you a leg up.
The most important thing I did was research, research, research. Whether my area could use another professionals dog walker, where the heaviest dog-owning neighborhoods are, what the going rate for dog walking is (I charge slightly more; never less!) what the average income of various nearby neighborhoods is, and my costs-per-walk against potential income. Leave as few mysteries as possible for yourself.
Two of the most important lessons I learned in entrepreneurship class:
1. Your competition has already done the research on market rate for you. They've already figured out what rate they can't go below. So why would you charge less? Respect that, and charge the same or more. Don't fall into the trap of thinking that potential clients are going to go for the cheapest service/product out there; that only leads to a race to the bottom.
2. Do not cut deals. You're a professional; there's a level of implied self-respect there. If you ask a roofer for an estimate, he's not going to look over your roof, tilt his head weakly, and say, "wellll, for you, I guess I can go....ummmm, a few hundred dollars cheaper?"
3. Oh, and a personal pet peeve; don't phrase your statements like a question; meaning don't use an upward inflection when you talk. State your price. Be forthright, not weasel-y. Your clients will respect you for it.
Good luck in your adventure! The world needs many more entrepreneurs.
Disagree. This is awful advice. Here's why.
All customers have an established buying pattern. In order to get said customers to get out of that purchasing pattern, their comfort zone, there has to be incentive for them to leave a familiar source of goods and services. Call it an introductory rate, call it a coupon, call it anything you want. But unless you have an absolute, compelling service advantage that can be enunciated in one simple sentence, be prepared to buy your business at the outset.
This is why even established companies have lower rates on anything, whether it's cable TV, new fast-food offerings, rug cleaners, or anything else when they are trying to introduce themselves to new customers or to a new area where competition already exists. These efforts are designed to stimulate trial. Mind you, once you're established and have a base of business, you need to work your value proposition relentlessly to support a higher price point and avoid being a commodity. But to think that you're just going to walk into a mature market, charge the same as your established competitors and get anywhere close to the business you need is the equivalent of smoking crack. It borders on delusional. Just saying.
To be sure, there are exceptions. A white-table restaurant, for example, if decently promoted will get a core of customers wanting to try out the new place. But for a business such as dog walking, your competition would have to really be doing an awful job (i.e., allowing Fluffy to escape, only to be run over by a semi) for those customers to hire you at the same price.
All customers have an established buying pattern. In order to get said customers to get out of that purchasing pattern, there has to be incentive for them to leave a familiar source of goods and services. Call it an introductory rate, call it a coupon, call it anything you want. But unless you have a serious, compelling service advantage that can be enunciated in one simple sentence, be prepared to buy your business at the outset.
This is why even established companies have lower rates on anything, whether it's cable TV, new fast-food offerings, rug cleaners, or anything else. These efforts are designed to stimulate trial. Mind you, once you're established, you need to work your value proposition relentlessly to support a higher price point and avoid being a commodity. But to think that you're just going to walk into a mature market, charge standard rate and get anywhere close to the business you need is the equivalent of smoking crack. Just saying.
A good point but be very careful here, always put a time limit on everything. Never agree to forever. This is the mistake I made, I set too low of a price. Even after my service was proven to be a successful option my business almost failed because I set the price too low without a time limit. It was hard to increase the price. It was when I realized that I must increase my price or go out of business when I finally did it and customers were not happy about it either. The ironic and good thing is everyone of the customer are still doing business with my company today. I did not lose one account.
I did not put a time limit, big mistake. On the other side, when you become more successful, don't get greedy and overprice. Don't price so high that you price yourself out of business.
A good point but be very careful here, always put a time limit on everything. Never agree to forever. This is the mistake I made, I set too low of a price. Even though my service was proven a successful option it was hard to increase the price. I did not put a time limit, big mistake. On the other side, when you become more successful, don't get greedy and overprice. Don't price so high that you price yourself out of business.
True. Unless you have supremely good volume operations (And unless you have the economy of scale of a Wal-Mart, you don't), once you have an established base of business, then you can begin ratcheting up your price in order to achieve a strong AGI. That's why you have couponing and introductory rates, inviting the customer to try our business on a provisional basis. But to sit there and advise people to start out by charging the same price as the established competition in the market is simply daft.
I work with many small businesses and one thing I did notice is when a new company starts to grow there have been a few who think their business is built on an island. They get too big for their birches. Remember, if you become successful, there will ALWAYS be another company who will try to take your place. Never let your mind convince you can't be knocked off the hill. Always be aware of your competition.
I work with many small businesses and one thing I did notice is when a new company starts to grow there have been a few who think their business is built on an island. They get too big for their birches. Remember, if you become successful, there will ALWAYS be another company who will try to take your place. Never let your mind convince you can't be knocked off the hill. Always be aware of your competition.
Absolutely. That's why you never stop marketing. You do it to reinforce your brand in the marketplace as much as to stimulate sales.
That's why I typically don't have a lot of sympathy for so many businesses who get steamrolled when Wal-Mart comes to town. From the time of the site selection to the permitting to the construction, it takes 2-3 years for a Wal-Mart or other category killer to open its doors. That is an amazing amount of lead time for a local retailer to get its act together.
And yet, a large percentage of them keep right on doing business the way they've always had. They don't shore up their brand. They don't make an effort to get new customers. They don't work to justify their high-touch positioning that justifies their higher price point. So when a customer walks into their store, looks at a price tag and says, 'Pshaw. It's 20% cheaper at Wal-Mart!' they have no answers.
A large proportion of buyers are disposed to shop locally if the merchant will come even close to a category killer's price. It's worth it to them in terms of feeding local business, not driving as far, enjoying better service and a host of other virtues. But the local merchant has to do SOMETHING to justify their existence.
Case in point? There were two hardware stores within easy driving driving distance of my house. Both had been around forever. At one of them, the counter help was knowledgable and always gave good advice. The other place, the counter help was notoriously rude, especially to women. My wife, who is pretty handy, went into the second place a couple of times to ask questions. His reply? "Why don't you get your husband to tell you?" It wasn't just her. He treated everybody that way. So when the Home Depot opened up a couple of miles away, guess which one of these hardware stores remained in business?
I would love to start my own business but am pretty nervous about the whole thing.
You hear so many bad luck stories.
Is there anyone out there who could share their positive start-up stories, and give me a bit of encouragement?
The most important thing I can recommend is to work at your business YOURSELF each and every day. That is the only way you can insure that your customers are receiving the kind of customer service that will keep them coming back and refer other people. Business owners who hire a bunch of people to run their business for them often discover that those employees do not care (to them it is just another job), and are more than happy to destroy your business (and steal from you).
My husband and I bought a business in 2010 and we have worked there every single day since. In fact, I went 262 days straight before I had a day off. Tough? You betcha! But our business has surpassed last years income by 50% with more growth expected next year and no end in sight. We are making money and paying our bills and putting money away for eventual retirement (we have a 5 year plan).
Be willing to make your business your ENTIRE LIFE and you will do fine.
But to sit there and advise people to start out by charging the same price as the established competition in the market is simply daft.
I do stand corrected and thank you. I was so stressed about getting my prices up that it really stands out in my mind. Hence my next comment.
If you are lucky enough to be able to have 2 mentors or a round table listen to all opinions and make your best judgment. Each business owner had different experiences.
Setting a price is one of the hardest decisions to make.
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