Business start-up: 10 vital things to do

Shelves of volumes have been written about business start-ups. But here are ten things to do that underscore the areas that are among the most important.

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1) Make a business plan. If you seek financing from a bank or anywhere else, you’ll have to provide a comprehensive business plan. But it’s vital that you write the plan even if you don’t need it to generate start-up capital. It will force you to think through the details of every element in your new enterprise, to identify weaknesses you would have overlooked, and to foresee problems before they happen.

Make certain the section on finances isn’t just pie in the sky; it must include realistic income and expense projections for at least the first 2 years. You may also want to get a how-to-do-it business plan workbook or computer program.

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2) Start with sufficient money. Undercapitalization is the most common and pervasive cause of failure in new businesses. Don’t underestimate your need for money. Be aware that it may take an extended period before your business shows its first profit; maybe 6 months, maybe a year, possibly even longer. Make certain you have enough capital in reserve to support yourself and your family while your business is developing.

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3) Know your competition. Understand who else is competing for the same customers you’re after. Know how big and important your competitors are in the market. Find out about their products and services, marketing strategies, pricing, strengths, and weaknesses. Compete successfully by being strong where they are weak. Continually improve on what they have to offer.

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4) Focus your business. You can’t be all things to all people. You must have a clear sense of the market you will be serving, and the products and services they will buy. Identify who your prospective customers are, where they live, how to reach them, and how much they can afford to spend. Determine what they’re not getting from your competitors. Then zero in on your target market.

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5) Cater to your customers. Ours is an era of consumerism. In business today, customers are the kings and queens. The businesses that succeed are the ones that go to extraordinary lengths to keep their customers happy. No matter what you sell, you are really in the business of satisfying clients. Remember, without them you have no business.

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6) Build a customer list, and use it to communicate with customers often. Existing customers are your best source of business. Your client base generates repeat sales and valuable referral sales, both of which cost you far less than getting new business from scratch. Your house customer list can be an immensely valuable asset. Use it often to remind clients who you are and the benefits you offer them.

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7) Stress marketing. Your professional knowledge and skills alone are unlikely to bring crowds of clients through your door. Your prospects have to know who you are, where you are, and why you’re so good. Get the word out. Don’t be afraid to market your business.

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8 ) Hire winners. Indifferent, uncommunicative people on your staff make a poor impression on your customers. Professional experience is valuable, but it counts for little without genuine friendliness and credibility. The two most important qualities to look for in new employees are enthusiasm and strength of character. You can teach them the rest.

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9) Get a first-rate attorney. A respected lawyer is an important resource for your business, especially when you’re just starting out and haven’t yet built a reputation of your own. Don’t hire a second-rate attorney just because he or she is cheap. Make certain your business is built on sound legal advice, with safeguards to protect you if you run into problems or when you decide to sell your business.

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10) Re-evaluate everything continually. Businesses that say, “That’s the way we’ve always done it,” and “If it ain’t broke, don’t fix it,” are bound to begin slipping sooner or later. Your profession changes, technology changes, customers change, competition changes, and the times change. Don’t get left in the dust because you refuse to change, too. If you wait until it’s broke, it may be too late to fix it.

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Boy, have you got the wrong number: Adventures in telemarketing

Perhaps, as a marketing professional, I shouldn’t make biased judgments about a marketing method other professionals accept as legitimate. But telemarketing is a special case. A bothersome, exasperating, irritating, maddening special case.

Every other advertising and promotion delivery system can be ignored, if you choose. You can snub a radio or television commercial by focusing your attention elsewhere, changing stations, or even turning off the set. You can bypass an ad in a newspaper or magazine simply by turning a page. You can surf away from a website with a single mouse-click. You can deep-six your junk mail without ever opening it. You can refuse to look at highway billboards.

But at quarter to seven in the evening, just as you’re sitting down, knife and fork at the ready, to tuck into your dinner, you’re not going to ignore that ringing telephone. No, you’re going to get up from the table and answer it. Because it just might be your cousin from Toledo, or your grandmother in Syracuse, or your neighbor next door, or somebody else you actually know, with a message you actually care about.

But it isn’t any of those people. They know it’s dinnertime, and they have enough regard for you to let you eat in peace. No, this call is from your local Daily Blah newspaper, in the person of some barely articulate lady who knows full well you’re eating your dinner   — that’s precisely why she’s calling now, because she knows you’re home — and who seems to think her half-price subscription offer is more important to you than your victuals.

Confronted by such an annoyance, I used to say, “No, thanks, I never read the Blah. And I’d appreciate it if you didn’t call at dinnertime.” But two weeks later, of course at dinnertime, another representative of the Blah, this time someone for whom English is not even a second language, let alone the first, again importunes me to join the Blah’s family of subscribers.

The cruel truth is, the Blah just doesn’t care. It’s a numbers game: they enroll one subscriber for, say, every thirty calls they make. Never mind that there are twenty-nine annoyed people — me included — for each ecstatic new subscriber.

I can hang up, of course, but I’ve still had to answer the phone while my food grows cold and the rhythm of my dinner is decimated. I feel the telemarketer owes me for intruding on my life. What he or she owes me is a bit of fun. Assailed by telemarketers for years and years, I’ve finally taken to playing my own games.

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TELEMARKETER:  This is the Never-Rot Home Siding Company. We install high-quality vinyl siding. Our representatives will be in your neighborhood next week, and we’re calling to see if…

ME:  Oh, it never rots?

TELEMARKETER:  That’s right, it’s high quality siding for your home. Now, when would it be convenient…

ME:  What’s it made out of?

TELEMARKETER:  Vinyl. It’s vinyl siding. We could come on Tuesday…

ME:  Could you speak up? The battery’s down on my hearing aid. I told Dot, that’s my wife, that she’s just gotta get over to the K-Mart. You ever shop at K-Mart?

TELEMARKETER:  Uh, are you interested in vinyl siding?

ME:  Vinyl what?

TELEMARKETER:  Siding. For your home. Are you interested?

ME:  Interested in what? Hello? Hello?

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TELEMARKETER:  This is George Hammerschmitt, with Merrill Lynch. I’m calling to introduce myself.

ME:  Mr. Hammerschmitt, if that’s the best opening you can think up, you have no future in this business.

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TELEMARKETER: My name is Norris Westerly, at Gruntal & Company. I’m calling to tell you about an important opportunity in the stock of Retro International.

ME:  Retro, eh? You think it’s a good investment?

TELEMARKETER:  Absolutely. That’s why I’m sharing this information with you.

ME:  Tell me, what did your brother-in-law think of Retro?

TELEMARKETER:  Who?

ME:  Your brother-in-law. You told him, didn’t you?

TELEMARKETER:  Why, no.

ME:  Do you mean to tell me you’re letting me, a total stranger, in on all this, and you didn’t even tell your brother-in-law?

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TELEMARKETER:  We’re calling to offer you a one month subscription to the Daily Blah for just $16.50. That’s a full 50 percent off the…

ME:  The Blah? Oh, no, I’d never let the Blah into my home.

TELEMARKETER:  Why not?

ME:  It’s under the control of people who are pledged to undermine our families and our society. The stories are filled with evil.

TELEMARKETER:  Really? I never heard that before?

ME:  Just read the headlines. Look at the pictures. It’s as plain as the nose on your face. Wickedness, I tell you.

TELEMARKETER:  Maybe I should read the Inquirer from now on.

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Anyway, you get the idea. Excuse me, it’s dinnertime, and the phone’s ringing. This is the only fun I have all day.

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Competing for new business? Don’t take “no” for a (final) answer

When a prospective customer chooses one of your competitors rather than you, don’t just accept that you lost. Customers often come to regret their choices. The supplier that looked best to the customer can turn out to be a big disappointment.

It never hurts to wait for a reasonable period, then call the customer and ask how his relationship with your competitor is going. If he’s having problems, he may or may not be willing to admit it to you. But either way, he’ll know you’re still interested in doing business with him, and you may find yourself with another shot at the opportunity you thought you’d lost.

Even if he’s still committed to your competitor, continue to call him from time to time. You never know when the competitor is falling out of favor.

My advertising agency competed unsuccessfully for an important account. The ads their new agency made for them were weak, and I knew it would only be a matter of time before the client would  want to change agencies. I kept contact with him, and nearly two years later we finally won the account. It was a relationship that lasted thirteen years, until I sold the agency.

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