5 activities that have a colossal impact on a startup
Starting a business involves taking a lot of risks. Many questions, ideas and concerns arise in the mind of the budding entrepreneur. In order to transform a business idea into an independently existing organism, it is worth taking the time to systematize it. The first step that needs to be taken to get closer to the goal is to create a business model., However, it is important to remember the key steps, which if carried out will minimize the risk of making basic mistakes, and these include: defining market segments, distribution channels, revenue streams, costs, as well as customer value and value proposition. The analysis of these 5 issues is the foundation of a new company, so it should be approached with due diligence.
When starting a company, it is worth asking yourself - Who do we want to target our products to? It is well known that a product designed to meet the needs of all groups of customers is unlikely to meet the expectations of any of them, so it is worth identifying them. One way to analyze this question in depth is to segment the market, i.e. divide it into parts that will identify the different groups of customers for the product. Learning about and analyzing these groups will make it possible to produce products that will hit the needs of customers. For example, a cell phone aimed at young and active people will have different features than a model for older people who appreciate, for example, large keys and long battery life.
Another important aspect is to choose the right distribution channel, that is, the route by which the product will be delivered to target customers. It depends on many factors, such as the type of product, price, type of buyer, or the size and resources of the company. The basic division is between indirect and direct channels. The first group includes sales using intermediaries (Wholesalers, Stores). In direct channels, the manufacturer reaches with his product directly to the consumer. The basic activity in choosing a distribution channel should be a solid analysis of the market, its segments and the volume and frequency of purchases. There are many distribution channels, so the key decision is to choose the most popular and cost-effective ones. It is also a good idea to analyze the channels used by competitors. It is important to see if they work well for our company and to make improvements that will help to stay ahead of the competition.
Values are a kind of foundation on which a company should be based, so it is worth paying attention and thinking about what specific values we want to represent, and what we want to convey to the customer, because they determine the future operation of the company - they are a kind of lens through which the company looks at the world. An example of a company that is guided by values is Tymbark, which is the main sponsor of the largest soccer tournament for children in Europe. Thanks to this action, children have a chance to learn about the world of football and develop their passions, and perhaps, as a consequence, there is also a chance to build a strong football team.
We can't forget about revenue streams or simply what our company is supposed to make money from. This is what will largely determine whether offering a product or service will be profitable for the company. When thinking about revenue streams, you should start by examining what value the customer pays for and what payment channels they use. Next, it is worth investigating what, if any, additional services or products the customer is willing to pay for, and what payment channel would be most convenient for them. At this point you also need to decide whether you want to use static pricing (list prices, depending on product characteristics, market segments or transaction volume) or dynamic pricing (negotiation, inventory management, auctions).
Cost structure plays an important role in any business. When analyzing this factor, it is necessary to answer the questions : What costs does our business generate? Which resources are key ? What generates the most costs and what generates the least ? Are there economies of scale? After answering these questions, we will get a picture of the cost structure of our enterprise.
After analyzing the above five factors and revising your binzesplan, the chances of success for your new business will certainly increase significantly.