Rolfe Larson is on vacation. This blog was written by guest writer Jan Cohen.
Regardless of how thorough your business plan is, the start-up period always brings surprises. This is the second of a two part series on lessons learned, based on experiences working with many business ventures.
3. The product or service won’t be what you’ve projected. In a new business with multiple products or a menu of services, it is important to listen to customers (those who buy and those who do not buy) and revise the mix, reshape the product(s) and the services if necessary. Remember that the first six months of a business are an important part of the business planning process. Be flexible in the product line, changing to meet market interest and to keep the customer. When listening carefully to customers, you may find that:
- There is less interest in one or some of the products or services you envisioned, but real interest in an additional or different model of the product or service. Suggestions to consider may include changes or additions to features, hours, participants, format, or pricing/payment structure.
- There is much more demand than you are ready to provide. Strategize whether there is a way to ramp up, or whether you need to limit the use or number of offerings. Growing too fast is as risky as growing too slowly.
- The market takes longer to develop. Marketing strategy changes to prioritize targeted markets are critical, as well as decisions about whether you can wait for the market to develop or change focus to a different targeted customer.
- Listen and learn. A new business, especially if it’s your first venture, may require a new and dynamic infrastructure of procedures and forms to assure quick and accurate processing of customers and collection of revenue. You may find that your planning didn’t fully account for this.
4. Let customers shape not only the product but also the message. The best way to get the right message that rings true to targeted customers is to ask them what’s important about this product or service.
5. Word of mouth can be more effective than all other marketing activities. People who know you, your organization, past customers of other services you’ve provided in the past, and those who are in your various networks can often do more to help you through their networks (in person and online) than all of the marketing materials you can create. Focus some efforts on these people.
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For more resources, see our Library topic Business Planning.
Jan Cohen has been a consultant and social enterprise practitioner working with nonprofit organizations for more than 25 years, focusing on earned income strategies and business venture development, start up, and management. FMI LinkedIn or email.