“Success is not final, failure is not fatal: it is the courage to continue that counts.” — Winston Churchill As a business coach, people often tell me their fantastic idea of a new business startup. It is exciting to hear the passion in their voices as they are thrilled to share their business idea. Maybe it […]
“Success is not final, failure is not fatal: it is the courage to continue that counts.” — Winston Churchill
As a business coach, people often tell me their fantastic idea of a new business startup. It is exciting to hear the passion in their voices as they are thrilled to share their business idea. Maybe it is the curse of operating a successful business for 40 years that makes me cautious when hearing of their new and improved business idea.
The only purpose of a business is to solve a problem for a customer. For example: an urgent-care facility is solving the problem of someone who needs non-life-threatening medical care.
I ask people what problem they are solving for their customers. I tell them it doesn’t matter what you think about your product or service. The only thing that matters in a business is what the customers think, want, and need. Will your solution of your new exciting business idea solve their frustrating problem and are they willing to pay you for your product or service?
As a startup, you need to find out who your customers are, learn everything you can about them, and what are their biggest frustrations. Find out what these customers are currently buying to solve their problems or if they currently have no solution available to help them. Everything in your business should be structured around your customers, your products, or your services. Your customers are only interested in how you can solve their problems.
To determine if your product or service is viable in the marketplace, you need to; as quickly as possible; deliver a minimum viable product (MVP) . Build a product or service that puts a prototype into the hands of your customer. In 1999, Nick Swinmurn put together his MVP, based on selling shoes online. In 1999, this was unheard of and he had no history to determine if his startup idea was viable or a dud. Instead of investing $150,000 in shoes, renting a warehouse, hiring a bunch of people, he realized it was most important to determine his business idea’s viability. Would people buy shoes online and could he make a profit?
Nick made an offer to local shoe stores, asking if they would let him take pictures of their shoes, inventory their shoes, sell them online, and pay the shop owner the price listed on the shoes. The shoe stores agreed; they had nothing to lose. The beauty of Nick’s MVP was all the customer data he picked up from this experiment. Then he finetuned his business model.
Nick learned that people would buy shoes online. He also learned the critical business information about handling customer orders, complaints, shoe returns, shipping costs, and packing orders. Was Nick successful? This shoe company’s name is Zappos and it reached $1 billion in sales in 2008, before being sold to Amazon in 2009.
So, keep up your excitement about your business idea. Build your MVP, get your prototype out to real customers, and measure the results to see what needs to be changed. Follow your dream, do your homework, test it, make the changes necessary to succeed, and just do it.
James McEntire, of Camden, is owner of Boomers Startups and helps baby boomers jump start their startup plans. Contact him at james.r.mcentire@gmail.com or (315) 225-3536.