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Four Red Flags When Starting a Business
Often, the excitement of coming up with a good business idea obstructs the logical realities of starting a business. There are a few major thinking errors we frequently run into, so if you are considering starting a business, be sure you have thought through these common red flags.
1. I Don't Need a Business Plan!
Whatever your reasons are for thinking you don't need a business plan (not seeking
investors, easy operations, it's in your head), you are mistaken. The process of
business planning walks you step-
You are better prepared to spot opportunities and threats and can make a plan for dealing with each. And, developing a plan for your business inherently creates goals and targets on which to evaluate your progress. You have to be able to measure performance if you're going to effectively manage performance.
2. There's Nothing Like This!
Consumers purchase products and services to fill a need or gain a benefit. No matter
how cool and original your idea is, the odds are that consumers are already meeting
the fundamental need or want in another way or they aren't yet aware of the need
or want. With the former, you do have competitors, you just haven't done the work
to identify them. With the latter, you have a long (read: expensive and time consuming)
road ahead of you in creating a new need or want among consumers, then convincing
them your product is the answer. This can be next-
3. It will Sell Itself!
No, it won't. All those stories you hear about viral marketing where a product takes
off because of word-
4. I'll Be Rich and Retired in a Year!
Small businesses generally succeed by honing in on a niche market and serving them very well. Then, once that market is working well, growth can come from targeting another niche. Over time, a small business can develop and expand their customer base...perhaps even growing into a monster company over a decade or so. But, you won't be competing with the big dogs right away (or rather, you won't be beating them), and you won't be spending your days golfing with the rich and famous by next summer.
Starting a business is one of the most difficult and potentially rewarding experiences available to most of us. The key to success lies in seeing things clearly from the start. Managing your expectations and thorough planning of your business's trajectory can get you where you want to be. Entrepreneurs may tend to be dreamers, but success only comes when they get down to the business of business and realistically evaluate and plan out business opportunities.
About the Author
LaunchX.com is dedicated to training entrepreneurs to turn their good ideas into
great companies. The LaunchX System provides step-
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