1. An effective business name
One of the first major activities of any new small business is development of its name. Since your business name is something that will be with you for a long while, it is something worth putting serious effort into.
A good business name is one that is descriptive of what your business does, preferably including what major benefit is supplied to the end user; and hopefully one that is memorable. Avoid names that are overly long or complicated; particularly as it is ideal if your domain name is an exact copy of the business name. Anything too complex will not translate into an easy domain name to use.
The business name can be developed further into a logo design that is eye-catching and attention-grabbing. However if the name is poorly chosen, then no matter how fantastic the design is, the impact of the name is undermined. Choose carefully, as your company or brand name is an asset that you will invest in over time and can't be changed easily or without cost.
2. Have sufficient customer demand
One of the basic pillars that any business relies on is the level of customer demand that is available for the product or service offered. The size of the market opportunity establishes a benchmark of total potential sales possible; which your product/service will try and take a share of.
A product or service idea may seem a definite winner to the person who develops it but it is the target customer base available who decides whether they will purchase it or not.
A key failing among businesses, big and small is to overlook the measurement of demand size from potential customers, before they proceed to launch. This measurement should look at:
- Customer reaction to the concept;
- What sort of pricing is appropriate for the product or service offered;
- How many customers will purchase these products or services; and
- The volume consumed per customer in a set time period.
With this information, you can likely get a sales forecast both in units and dollars which helps also complete a cashflow and profit forecast prior to launch.
This way, if the volume of demand is inadequate for success long-term, then further investment can be avoided or redirected.
3. Develop and use a USP (Unique Selling Point)
Every small business needs to have a unique selling point or point-of-difference (POD) versus competitors. Unless you have the luxury of operating in an environment without any competitors and have a truly new-to-the-world innovation that will sell like hotcakes, then you will need to have a POD.
A business needs to have a sustainable edge to be successful which requires that any difference that is a significant advantage be not easy to copy by competitors. Great companies develop unique competencies amongst their staff that help deliver competitive advantage over time that can't be copied by others.
Once you have that USP then use it! It should form the basis of all your communications to customers, both internal and external.
4. Have a Business Plan
Having a well-thought out plan before any small business is launched is the best approach to ensure a maximum chance of success. It should outline clearly:
- What the business's main reason is for operation (Mission statement),
- What its' long-term goal is (Vision statement),
- The plan to achieve this (strategy) and
- What costs are involved (Marketing Budget and Profit & Loss statement).
The Business Plan sets the direction for the business and should be used ongoing with modifications made as required to keep it relevant along the way. Businesses which don't use a plan to guide them, run a great risk of just bobbing along directionless, like a rudderless ship. This is a sure-fire way to miss opportunities, waste money and lose your way. At worst, these businesses will join the ranks of other failed enterprises.
Continued in Part 2
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