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7
key factors for a successful start-up
Successful new entrepreneurs must monitor
how business is evolving, plan realistically, and be
able to mobilize their troops to achieve their
objectives. Few people have an accurate sense of how big
a task this truly is before they begin.
It is
not enough to have an idea -- even a very good one. The
greatest visionaries often make very poor executives. In
practice, vision is only one part of the equation; it is
just as important to know how to deal with concrete
problems and to be able to "sell your stuff".
The following are conditions necessary for
creating a successful, viable business:
1. Find a promising
market
The ideal situation is
one where you introduce your products or services to a
young and fast-growing market. In more mature sectors,
you will need a competitive advantage in order to
distinguish yourself from the competition i.e. great
customer service, low costs, or a product or service
innovation that gives the customer added value.
To identify and define your
potential market:
- Gather
as much information as you can;
- Use a
specialized research company;
- Study
the competition and assess its strengths and
weaknesses.
You should also
perform a conservative assessment of your potential
market to determine your breakeven point. For example,
in the manufacturing sector it could take months, if not
years, of research, development, and design work to
develop just a prototype. During this time, you will not
be making any sales.
2. Surround yourself with
the right people
Members of the
management team supporting the entrepreneur must
complement one another. The best leaders ensure that
they recruit the top experts for each area of
operations. You should not be afraid to hire people who
are, in their respective fields, more competent than
you.
You must think "team" and not just in terms
of partners and employees, but also with regard to
outside resources. You will need technicians, sales
people and managers, a lawyer, an accounting firm,
advertising-marketing and public relations agencies, and
so on.
Instead of a prestigious board of
directors – a luxury few new businesses can afford – you
can set up a strategy committee and invite an expert and
mentor to join to act as a sounding board for your
business approaches. In advanced technology, there are
more and more incubators that offer a wide range of
assistance for increasing your chances of success.
In the end, the true test is the market. To
reach customers quickly and efficiently, you should
think about hiring marketing specialists at the outset.
Marketing, while often neglected, is critical to the
success of any business.
3. Plan for tomorrow and the
future
Avoid getting bogged down
in immediate problems. Make a list of all the factors
you have to consider in the immediate and medium term,
especially if you foresee rapid growth. You need to
examine all available options:
- Purchasing or leasing premises,
furniture, or equipment;
- Doing
the work internally or outsourcing different
operations.
The list of aspects
to consider may be much longer: energy and resources,
raw materials, salaries, financing, technological needs,
etc. For example, if you need to build a plant, you will
have to include other factors such as cost of the land,
proximity to major highways, suppliers, a qualified work
force, and so on.
In some cases, you should not
be afraid to think big right from the start. If you are
positioned in a small niche, you may not be profitable
unless you start exporting quickly. To get a better
idea, check with our national, and regional support
services.
Finding the answers to these questions
is important not only to you; financial institutions and
potential partners or investors will also want to know
the answers.
4. Organize your
financing
Start-ups are often
financed by the savings of their founders (as well as
the savings of families and friends). In many cases it
becomes necessary to look for outside capital such as
Angels (private investors), venture capital funds,
assistance funds, or social economy funding agencies.
You must know how to approach them, what they
expect, and what they can do for you. A businessman who
invests in companies told us: "If you knock on a
door prematurely, you run the risk of it being closed to
you later, particularly at the time when you are really
ready to enter it."
There are also grant
programs for certain types of businesses and
entrepreneurs that you should consider, although it is
not always easy to sort out what they want.
5. Take
advantage of waiting time
Most
companies take time to get established, resulting in
periods when business is slower. Whenever you are
waiting to sell your products or services, or in between
meetings, you should stay as active as possible, if only
to avoid getting discouraged.
Fortunately, there
are many ways of doing business while you wait; creating
or expanding your network of contacts is one of the most
effective. Three networking strategies that may be
appropriate, depending on your situation, are:
- Enter a
business plan contest for young entrepreneurs;
- Participate in trade shows or
exhibitions;
- Join a
business group (Chamber of Commerce, etc.) or
professional association.
6. Settle the formal aspects
from the very start
There are
many rules, some very technical, which are absolute
requirements for your business' continued existence: you
must decide what legal form it will take, design an
accounting system, and comply with regulations covering
labour practices, occupational health and safety, and
training.
In business and industry, an
individual can start a company in his or her own name. A
group can form a registered partnership or an
incorporated company with a different set of rules,
privileges and responsibilities. If you have several
partners, you should draw up a shareholders' agreement
to define a mutual code of conduct. If you operate in
the social economy, you could decide to form a
cooperative or not-for-profit organization.
Determine if your ideas could be patented, or if
they are protected by a copyright, registered trademark,
or trade secret. There is the possibility you might be
infringing on the rights of another company in this
regard.
7. Write a clear,
comprehensive business plan
All
the above elements must be included in your
business plan.
Your plan must be concise, specific, and
describe your business project accurately. Have our
business plan experts write it for you in your vision.
It is not an accounting document, even though it must
contain some figures and a budget.
We
will show it to people we know (accountants,
lawyers, other entrepreneurs) before presenting it to a
financier, and don't hesitate to rewrite and update it
if necessary.
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