Posted Thursday, May 29, 2003
You've heard this sort of tale often. Two young lads with a computer in a basement launch a small business that explodes into a roaring success creating millions for the creators. That such tales are told, lends to the myth that it's easy to get rich on the Web.
What isn't usually mentioned, for it's not news, is the thousands of failures that balance one success. As with new products, we hear about the winners in time. We seldom hear even whispers about the failures.
You have a better chance to win the lottery, than to succeed in business by accident. It just isn't going to happen.
You Need A Plan
A solid business plan is central to success. It doesn't need to be fancy. It doesn't even need to be complete. But you do need notes you refer to frequently regards actions scheduled or to be considered. This keeps part of your mind considering them, even when you are not consciously thinking about them.
Depending upon where you are in the process of building your business, your plan may range from some roughly scribbled notes to a work of art that will make your banker smile and reach for a pen when you ask for a loan.
Flexibility Is The Key
But a good plan is never fixed in stone. Use a pencil. One with a great big eraser. Marketing conditions vary constantly. Consumer interests can be unpredictable. Your best seller today may be a loser tomorrow. For all these reasons, and more, the plan is subject to change at any time. For example,
- What will you do if your supplier goes out of business?
- How will you deal with one who becomes too slow fulfilling your orders?
- Are you prepared for an unexpected decrease in demand for your product?
- How will you cope with unexpected competition?
There are many such questions, and they are not trivial. You need to be prepared for any change that can negatively effect your business. And for changes that offer opportunity! Being informed means staying in business. And conversely.
What follows are the kinds of things with which you need to deal. You may not need some items. And you will likely need things not mentioned here. What matters most in creating your plan is to be as complete and brief as possible.
Basics For Your Website
Make note of where you are with items such as the following. Include a schedule for reevaluating on a regular basis.
- Represent the best products available
- Provide complete, accurate, and detailed information
- Have a tops-in-class website that sells like crazy
- Go overboard on support; be superior to all others
- Produce the best newsletter related to your niche
Your Product Is Central
Whether you manufacture your own product or sell one produced by others, it needs to be differentiated from related products. It must be presented in such a manner as to be perceived as the best choice by your Perfect Customer. Questions to be answered about your product include the following.
- How does it compare to competitive products?
- How does it differ?
- Why is it better?
- What is its USP?
- What will you add to your product your competitors can not?
- How does your Perfect Customer for this product differ from that for your business as a whole?
- What products are candidates for replacement, should sales falter for whatever reason?
Track Your Competition
Build a specific plan for monitoring all actions by your competitors. While remaining tuned in to indirect competitors, the major task is tracking direct competitors, particularly those with strong positions relative to yours.
Subscribe to their newsletters, monitor changes in their sites, and observe how they support their customers.
What is needed in so far as your business plan is concerned, is a procedure followed consistently, including when specific actions are required. For example, make a note to visit your competitor's sites on the first of each month. Without such reminders, you can overlook major changes, then suddenly find yourself losing ground, wondering how it happened.
Reaching Your Target
Be as specific as possible about your plans for extending your reach to contact more prospects. When data and dollars are available, advertising can contribute significantly to your bottom line. Whatever you can think of to extend your reach needs to be jotted down. While it may seem premature, include thoughts about reaching your target through offline channels.
Your overall strategy amounts to stealing customers from your competition. While you need to be thinking in terms of how to accomplish this, campaigns can be delayed until a clear and specific game plan is in place. And until adequate resources are available. Still, add at least a note about this aspect of your plan. As with all else, thoughts will emerge over time provided the topic comes to mind now and then.
You Need Answers Now.
To wait until a crisis erupts is to have waited too long. It is always more difficult to find good solutions when under pressure. Obviously you can not anticipate all upcoming issues, any more than you can anticipate all future opportunities. But plan for all outcomes imaginable. Do it now before a full blown crisis so overwhelms you as to make it difficult, if not impossible, to find a reasonable solution.
Include in your notes how you will ...
- Continue your quest for top quality products
- Achieve your financial objectives over the long term
- Deal with changing regulations at all levels of government
- Cope when you are suddenly not available as when ill
- Survive the ultimate disaster such as unbeatable competition
Isn't This Going A Bit Heavy?
Those new to business may not recognize the need for constantly reviewing their position. But these are not idle considerations.
I know of a fellow who has been in the tire business for many years. And he featured Firestone tires. He constantly stays on top of the tire business.
Two years prior to the collapse of Firestone, uncomfortable with information available even then, he switched to Good Year. This gave him two years in which to say to his customers, without knocking Firestone, that he felt Good Year was now the better tire. His reputation was given a grand boost when Firestone failed.
The moral? Be prepared to drop a product in a flash. Have a replacement handy at all times. Be able to change directions in the blink of an eye. Assure you're prepared by keeping your business plan up-to-date. And review it regularly.