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10.04.2006
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Дмитрий

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ENGLISH4U.com.ua - Английская Грамматика по E-mail


Грамматика английского языка. Выпуск 17
Рассылка сайта www.english4u.com.ua
English Reader

Start your own business.

A friend took me to dinner to pick my brain about her new business. She was excited: she had a great idea, had lined up a strategic partner, and was raring to go. She had visions of raising millions of dollars. I felt terrible telling her that while her ambition was admirable, her business plan was lousy.

Now, that's not to say she can't raise money for her new company. These days it seems like even the craziest idea can raise $100 million. But, it's not enough to have an idea you can convince others to invest in; you have to have the basis for a solid, real business.

No matter how much money you can raise for a company, at some point, real customers are going to decide whether they want to buy your product or service. Even if customers are willing to buy, you need to have a business operation that enables you to make sufficient profit to survive.

So what were the problems - and there were many of them - with my friend's idea?

First, like many novice entrepreneurs, her idea was too grandiose. She had too many services, serving to diverse a market, to be able to successfully develop anyone aspect. The single biggest problem facing entrepreneurs is lack of focus. It's a big enough challenge to stay focused on even a narrowly defined market with a clearly delineated product; when you take on too much, especially in the early days of a company, you almost guarantee defeat. My friend's business could have easily been broken up into two or three businesses, any one of which might possibly succeed. But she was committed to serving the whole market.

Many entrepreneurs, of course, fall to the other extreme: their business idea is so narrowly defined that it's actually the basis for just one product - or just one feature of a product - rather than a whole business. This is particularly true in two categories: consumer products and technology. Let's say, for example, that you have a great recipe for a new kind of sauce. One sauce, no matter how terrific, might not be enough to build a whole company around; you might need to come up with a line of sauces.

When your business idea is too limited, you may not be able to get big enough to survive. Even if you are successful, you're vulnerable if a larger company later decides to mimic your idea. The good news - and this particularly happens in technology or if you can develop a cultlike following of customers - is that your company becomes an excellent candidate to be acquired by a company that wants to include your product as part of their offerings. You won't be your own boss, but you might get a pile of cash.

The next biggest dilemma in my friend's business was she hadn't considered the real costs of delivering her proposed services. One of rules is "Things take longer and cost more than planned." To be successful, my friend's company depended on achieving lower costs than her competitors. She thought she could do this just because she was operating on the Internet. Get real! An Internet business is just like a land-based company: you still need customer service, employees, and substantial marketing efforts. If you're depending on cost savings for a competitive advantage, prove that such savings can actually be achieved and sustained.

Finally, my friend's biggest problem was my friend. She's stubborn, unwilling to listen, insistent on getting and keeping control. (So why is she my friend? That's another column.:) It's not enough to have a great idea, or even great operations. A company needs leadership and management. You can't build a business without building a team. You have to work with people; not just have them work for you.

It's not always easy to scale back your vision or your need to be in charge. But if you want to grow a company, not just make yourself a job, you've got to consider whether your good idea can really be a good business.

Take it into account!

Unfortunately, some potential business owners abandon their ideas too easily believing that if an idea has flaws, the concept is unsalvageable. To help you avoid this trap, use the five instances of idea-roadblock listed here to determine how you can keep going if your idea isn't perfect.

You're hardly the first
Problem: Lots of people are already running businesses doing what you planned on doing.
Solution: Examine the field and see if there is still room for you. Often, lots of businesses cater to the same customer, but leave some small niche underserved. For example, if you planned on starting a dance studio and you find that there are already too many in town, there may be a market for someone who goes to private parties and teaches large groups of people who don't have time to go to a dance studio. To find an underserved niche, look at the current offerings of your future competitors and think about what narrow markets you may be able to serve that they are overlooking.

Too late?
Problem: You are too late to market.
Solution: Just because other companies beat you to market doesn't mean you won't be successful. In fact, the first company to market has to spend a lot of money educating buyers about why this new product or service is worth purchasing. You can also learn from the mistakes of your predecessors. For example, look at how Microsoft came into the spreadsheet market and took over with Excel after Lotus had been dominant with its 1-2-3 product.

Flat industry
Problem: Your research tells you the industry is flat.
Solution: See if you can look at the business a totally new way. For example, a movie theater owner in Europe who recently entered a market that was saturated and suffering from a lack of customers. However, by starting a movie theater with huge comfortable seats, lots of parking, and other amenities that transformed the movie-going experience, he was able to pack his theater night after night.

Prohibitive costs
Problem: Set-up costs are too high.
Solution: Start out as a contractor to a business that you want to create. For example, if you really want to own a bakery, but you cannot afford rent, start out by baking a few goods and supplying them to existing bakeries. Over time you can save enough money to have your own store.

Lack of information
Problem: You can't find information about the industry to determine if your idea is viable.
Solution: The best way to learn about an industry is to talk to small business owners who are in it. Many entrepreneurs will be willing to share a few hours with you to explain how they got started, and how the business works. As long as you are not potentially direct competitors, you will find many entrepreneurs helpful. You may need to call 50 people to find five who will help.

Unknown words:
survive - выжить, уцелеть
entrepreneur - предприниматель
delineated - выраженный, разграниченный
vulnerable - уязвимый, ранимый
stubborn - упрямый, упорный
cater to - удовлетворять, угождать

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