Have a great business idea? And you want to start your business right away? Register your business, register your domain, rent a location, trademark your name, open a business bank account, buy a business car, etc.?
I get it, you can't wait to start, no time to lose. Besides, your idea is great, right? You're so passionate about it. There is no way you could fail, right?
Well... There could be ways. There are always ways to fail, sorry to be the person to burst your bubble. But research shows that around 50% of new businesses fail within the first 5 years. That is why I always recommend people to first make a solid plan before they start. That includes research.
If there is something in life that I learned, then it is that we can NOT do everything ourselves. And not everybody can do everything. Not everybody can become a lawyer, not everyone can become a police officer, Judge, football player, athlete, and so on. Our system wants us to believe that we can do everything, but the harsh reality is that we often can't. It takes years to learn skills, and after we have finished college, we still have to keep learning more.
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That is why I believe that you should choose as early as possible in life what you want to do and stick to it. There are moments in life that you can change your path. But you have to know that you CAN'T do everything. Just because somebody else can, doesn't mean you can.
Why am I ranting about this? Because, I too often see it happen that people start their own business before they ever did any research. You have to, before you start, do enough research to understand the business and market that you want to operate in.
One of the most important things you have to do first before you start is, research your competitors.
For example, if you want to start a dog grooming store. You first have to find out if the location that you currently are is the best choice. Find out how many people live there, how many people have dogs/pets, and above all, is there any competition?
Even if you live in a very populated area, and you somehow found out that 50% of the people own dogs. But you have no idea how big the competition is, then you might make a huge mistake investing in this area.
So unless you do a good amount of competitors research and come up with a plan on how to “outsmart” your competitors. There is no way you should start your business right away.
Questions that you have to ask before you start:
- How many competitors does this area have?
- How are they doing their marketing?
- How are they marketing themselves?
- Can I do things better than they are doing? How?
- How big is the company, do I have a relative good chance to compete with them?
- Does your price compete with that from your competition? Do you still make a profit?
- How long is your competition operational in the area? Does it have a long-standing trust from its customers? Would it be likely that your competitors’ customers would move to your business? Why?
- How does your competition promote and distribute their products or services?
- What are my competitors missing out on or doing wrong, that I can do better?
- What are my competitors’ customers’ complaints and problems, how can I do this better?
- Are they spending allot on Facebook or digital marketing?
There are a ton more questions you can ask yourself, but these are some of the most important in my opinion.
You see, as soon as you start to think about these things, you start to realize that you still have to do a lot more research before you start investing money.
If you want to open a physical store, location can be very important. And you might have to move your business to another location. If moving is no option, you really have to do excessive research about your competition and how you can compete with them.
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And if you plan on competing, you should find out your competitors' weak spots. Not to attack! You don't have to fight with your competition. As a business owner you solve problems for people. Often more than one. Find something that your competition isn't doing. And offer a solution for your customers. Or, show that you offer a much better solution than your competition.
For a dog grooming business this might be something different than your competitors, like:
- Does your competition offer a hotel service for dogs?
- Discounts for new customers?
- What products do you use for grooming? Is there a more healthy and natural product that you can use?
- How can you make the stay for your customer’s dog more nice, offer toys, beds to sleep, separate rooms, or video observation? etc etc.
I hope you understand that research is important, and I wish you all the best with your business.
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