Every day thousands of people open their startup ventures, but within a few months or at most by the end of the first year half of them have to shut down.
All of the startups which vanish before they can earn the owner some return have some strategic fault, which was probably ignored at the time of beginning the business. So to help entrepreneurs, we have here the first three steps which will help them in giving a strong start to their entrepreneurial venture.Research for the demand
Most people take the plunge without determining the demand for the product or service they propose to offer through their startup. Business is never about making something and then looking for buyers, it’s about finding out what people want and then selling them what they want.
So don’t try changing this simple process, or else your entrepreneurial startup is bound to fall flat on its face. So before you get started, do a little bit of research, about what the customer wants and how big and continuous is the demand for the products you plan to make.
Planning should be the first thing, once you have decided to startup your own venture. You need to have a detailed plan about
• products or services you will be offering,
• the procurement of raw material
• the processing and production procedures
• sales and marketing tactics, building up a sales channel, tying up with dealers and retailers
• assessing manpower requirements and where to get your man power from
• arranging for and organizing the premises
• finding about the latest in technology and procuring the required equipment
• building strategies to fight competition, to lower costs, to add a USP to your products,
• And finally planning out the finances in terms of expenses and revenue.
Estimate your expenses and revenues
Most startups make one big mistake in planning the financials; being overenthusiastic they end up overestimating the revenues from sales. Also, without finding out the exact costs they decide on their expenses, only to realize later that the expenses have been more than expected and they are now running short of funds.
The base rule here is to underestimate the revenue from sales and to overestimate the expenses to be incurred on setting up and running the business. If you just get this thing right, your chances of having to shut down your startup because of funding problems or because of low sales, will be less than 10%.