4 Basic Questions to Answer Before You Launch a New Business
It’s easy to overlook the future when you’re squarely focused on the present, especially if you’re in the throes of starting a small business.
But answering some basic questions before you “hit the launch button” will help you set the best possible course for your new business. It’ll also ensure that you have all of the elements in place you’ll need to succeed — and perhaps even prevent you from mistakenly putting your shoulder to a wheel that simply will not roll.
Here are four key questions to answer before you launch a business:
1. Who will buy what I’m proposing to sell? So much of a business’ success flows from identifying and understanding customers that it’s never too early to work on this issue. The sooner you learn to recognize your prospects and what floats their boats, the more directly you can focus your time and energy on developing your products or services, pricing your offerings, rolling out your marketing and promotional efforts, and otherwise taking steps to gain their enthusiastic support.
2. What people, with what personalities and skill sets, will I need to help me? While some skills are infinitely transferable from one business — even one industry — to another, every successful small business develops a character of its own and thereby makes highly specific demands on the people who operate it. For example: a bakery thrives on early morning attention; a hardware store requires an aptitude for tools and tinkering; and a software developer demands logical thinkers driven to abstract conceptualization. Think through your business’s talent requirements (and perhaps do some recruiting) before you hang your Open for Business sign.
3. Is this work I will enjoy doing for the next three years? Throughout the literature regarding small business operations, there’s a litany of warnings about how much time and effort it takes to succeed. Because few of us have the willpower to devote extreme hours and energy to a business we dislike, it’s sensible to embark on such an arduous journey only if you’re certain you’re going to derive personal pleasure and payback from it. Consider your answers to such questions as: Will you enjoy the work? Will you like the people with whom you’re dealing — on both sides of the counter? Will you be happy with the end result?
4. What is my exit strategy? You may think it’s counterproductive to think about leaving before you even arrive — and in many situations it is. But starting a new business is a special kind of endeavor in which thinking about your exit can make the journey more fruitful. With an eye toward handing off your company to heirs or selling it to investors, you will, for example, tend to organize the business more effectively, drive it more directly toward measurable success, and rely more on systematic procedures and efficient equipment than on your personal willingness to tolerate unpleasant or difficult work.
What other questions do you think are important to ask when you're starting out? Sound off in the comments.