For business start-ups — Martha’s dos and don’ts
In the end, the consumer speaks
The serious refrains are constant: Bermuda needs jobs. Bermuda needs new businesses (or increases in existing businesses) to create jobs. Bermuda needs increased consumer activity and commercial interests participation to generate more demand for services/products that can be supplied by the new/existing businesses. Bermuda needs revitalisation. Bermuda needs to be more competitive in business: domestically and internationally.
The creation of a business in any environment is a unique challenge, unlike any other. Reader informal poll! If someone tells you that he/she is starting a business today in Bermuda, your reaction would be which one of the following -
1 A risky proposition at best?
2 A calculated well-researched opportunity for success?
3 Sheer madness?
4 It depends?
If you, the local entrepreneur, or recently redundant employee, decide to take proactive measures and create a business, those consumers and commercial interests will buy, won’t they?
After all, isn’t a local business that can provide a decent service/product, a business that expands, hires employees, pays benefits, supports the community and contributes to government tax coffers worth sustaining? Possibly, if the business value is perceived and the ever-fickle consumer thinks it is worth their time and money.
Where to start?
Whether you are contemplating a one-person business start-up or have funding in place for an instant storefront operation, you must do your due diligence personally, even if you have an advisor. No one but you can have your instincts and vision. No one but you is going to work as hard as necessary to achieve this success.
Numerous articles, websites, blogs, non-profit agencies and consultants expound the many checklist items that are required to start up and run a successful business. They generally start with taking steps in a business plan.
We quoted examples here from StartupNation,* ‘10 Steps to Open a Business,’ - a well put together series that opens with the most critical of the business questions: “Plan your life, then plan your business. If you do what you love, you’ll work harder, better, and more happily.” The first step looks critically at your current life status - asking you to examine for your quality of life, realities of your life including financial responsibilities, savings, expenses and the more sublime thoughts on things that make you happy or unhappy, and related personal planning.
The following nine steps (at StartupNation) review choosing a business model, creating a business plan, selecting a business structure, creating key business assets, finding the funding, organising logistics, finding great people, establishing a brand, then marketing and selling.
But I believe that the most prominent business start-up success categories revolve around shrewd intuition and detailed research focused on understanding your future customers’ demographics, anticipating the saturation/boredom point, and out-innovating the always-ready-to-mimic-your-originality copycats by branding your business.
A business has no hope of success if it is founded on hope alone.
The ambition to succeed
The entrepreneur with the “I want to own my own business stars in his/her eyes” has to have just the right combination of:
• attitude and attributes,
• burning desire to succeed,
• intuitive reasoning,
• shrewd calculation for pricing to profit - some would even say ruthlessness
• understanding of human nature,
• stratospheric vision restrained only by acute practical thinking,
• unlimited physical and mental energy,
• perception and flexible ability to adapt to abrupt changes in business and personal environment,
• more, way more than adequate financing, in almost all cases,
• dogged perseverance and belief in the end goal.
Sometimes, even these superlatives may not be enough.
There are fewer jobs are available. Fewer people employed full-time means tightened (or empty) pocketbooks. Less demand for services/products when less money to spend. Cash is hoarded in savings for future contingencies. Do-it-yourself becomes the necessary norm. Do without. Reuse.
Is the current Bermuda economic environment a detrimental sales hurdle to all but extremely necessary purchases? The answer is again - it depends - on how the entrepreneur meets these challenge.
Nuts and bolts branding
What can you offer the customer that will meet their needs, and possibly satisfy their wants, at the same time?
Price - should you compete on price? Competitive pricing contests often represent commodities that everyone needs, although not necessarily want. You’ll have to have big muscles to move into those circles and the financing ability to stay there, because the profits margins are often smaller, and the amount of product to move / turnover requires larger cash outlays.
On value? How do you define value with those whose budget is very limited? Or with those who can purchase what they wish. You cannot eat value.
On desirability - where your service or product is at the customer’s front of mind at all times. Why do people flock to globally-known coffee bars? Some say, it is just fancy coffee. Is that what they are selling, or something else? Don’t even those who can only afford an occasional “fancy” coffee stop there? So, the stores certainly aren’t competing on price of coffee.
Do you sell need versus want? Populations need to eat; run and insure their vehicles; use electricity and appliances; clothe their families, etc. They don’t need to entertain, travel, display jewellery, high-end electronics, use speciality services, and acquire accessories. They desire and want to have or do those discretionary items, but they have to be persuaded.
Or do you take the reverse tactic and embark into the highly desirable want-to must-have market.
Whatever the ultimate choice, making the end point business service/product decision is very stressful. Get it wrong with wrong product, wrong pricing, wrong sales attitude, you are challenged out of the starting gate.
You have to get it right, and keep it right in your business if you want to make a profit, expand product lines, hire employees, and become financially secure. And the first few years may be hard and lean work to reach that success.
Next week: Part two - Assessing customer demographics in a closed society, the saturation point and copycat combating.
StartupNation Rock Your Business. 10 Steps to Open for Business. http://www.startupnation.com/step-by-step-guide/10-steps-to-open-for-busineMartha Harris Myron
CPA PFS CFP JSM
Masters of Law: International Tax and Financial Services, Summa Cum Laude
Appointed to the Professional Tax Advisory Council, American Citizens Abroad, Geneva, Switzerland
The Pondstraddler* Life™ Consultancy provided planning for international tax, immigration, investment, retirement, legacy, and related financial challenges to the lifestyles of internationally mobile individuals and their businesses residing, working, crossing borders, and straddling ponds in the North Atlantic Quadrangle. Specific focus for residents of Bermuda, the premier international finance centre.
* Pondstraddler. A person with one foot on each shore whose heart resides in both countries*