Blog Archives

Starting a New Business: Nine Bitter Lessons I Learned this Year

Do you have the dream of owning your own business? Are you in the process of starting a business or you have an idea that you intend to turn into a business opportunity? Then this article is definitely for you.

It is been quite a long time I wrote an in-depth article about the happenings in my business. Well, this is one of such articles. For those of you that have been loyal readers of my blog, I believe you are aware of a project I undertook last year. Now for those who are not aware of this project, I will brief you. On the 21st of April 2012, I set a goal to start a new business entirely from scratch and this goal was to elapse on the 31st of January 2013.

Now after several months of in-depth research, planning, hard work and struggle; the goal has finally being achieved and “********* Technologies LTD” is currently on stream but it took till 1st March 2013 to get it done. So in this article, I will not only be talking about the project itself but I will be talking about the process it took and the lessons I learned. However, I won’t be revealing some vital details based on legal grounds but when it has been certified okay by my lawyer to do so, I will share them. So without wasting your time, below are nine bitter lessons I learned from the process of starting this new business.

 Starting a New Business: Nine Bitter Lessons I Learned this Year

  • No business is easy

Yes. My lesson one is that no business is easy and the reason I chose this as lesson one is because I still get emails and requests from people enquiring about the best business to start. I have said it before that the best business opportunity does not exist and this recent business venture I undertook has proven it again.

Despite my previous adventures and experience as an entrepreneur, I still had to go through the same process I went through when I started my first business and the process wasn’t easier this time. In the course of trying to find a suitable opportunity to pursue, I had to travel down to Imo state and I found a lot of opportunities there but there was always a hitch surrounding every idea. Below are some of the business ideas I researched upon while on this quest:

Cold room or Frozen food business – The demand for frozen food is already high but the business is quite capital intensive. I will also have to deal with the power supply problem and lastly, there’s currently a review of the policy on importation of frozen fish that may affect the industry. So I had to bypass this business opportunity but i still have it on my plan.

Poultry or catfish farming – I have the passion and all the data regarding this business; and the demand is quite enormous. Yet, I still don’t know what’s holding me back from venturing into this business. Maybe it’s because of the risk associated with livestock farming (high mortality rate of the animals). A close friend of mine ventured into poultry farming during this same period I was doing my research and planning for my business. He started with 6,000 birds and before you could say jack, he had lost 1,000 birds. Such is the risk of business.

Palm Oil Trading – I am looking at sourcing palm oil from local processing plants in remote villages and transporting them to high population areas for reselling. I still have this business on my drawing board so I can’t divulge much.

Palm Oil processing – Now this is a business that involves some production technicalities and I intend venturing into it with a partner. It involves buying the raw palm nuts from the farmers and processing it into palm oil. I have a very good friend who spent countless hours travelling into remote villages in Ngor Okpala and even up to Bayelsa, researching and digging up any information he can find about the business. To be sincere, nothing would have been done about this opportunity if not for this friend of mine. We are still trying to get this opportunity off the ground, so no much details for now.

Importation and retailing – I also looked at importing and retailing some products that will suit majority of the population in Imo state; which comprise mainly of students. But I have to drop the idea for reasons best known to me.

After much detailed research, I chose to set up a business that combines providing services, digital marketing, publishing and technology. Like I said earlier, I can’t reveal much detail now until I am through with the legal processes involved with the business. Now considering the in-depth information gathered and the amount of time it took me to setup my current business, I can boldly say that no business is easy to get into.

So if you are one of those people looking for the best business to start with N1,000,000 or $5,000 or whatsoever, then I have this to say to you. Stop the insane search now because the best business idea or opportunity does not exist. Secondly, there’s nothing like an easy, stress-free or risk-free business and lastly, all businesses are lucrative. Yes, all business are lucrative and no business is more lucrative than the other. I have seen people make tremendous profit in charcoal retailing and distribution, despite the fact that it is a dirty business as described by some people. As long as you have adequate knowledge about a particular business, the needed passion and the capital, you can find success in any business venture.

  • Critical research and planning can make or break your business even before you launch

Why did I take the pain to research several businesses before choosing one? The reason I invested much time into research and planning is because a successful business is created right from the drawing board, even before a dime is invested. Another reason I invested much time and resources into research and planning is because having adequate knowledge about a business is a requisite for success; and it can also become a competitive advantage for you.

One of the reasons why most people fail in business, especially here in Nigeria is because of lack of research and planning. I have seen countless of people jump into a business simply because a friend or neighbor is succeeding in such business. I have also seen people start a business based on the recommendation of a family member or friend. My dad was also guilty of this and he paid dearly for it.

As I write this now, importing is the hottest business idea in Nigeria this 2013 and there are thousands of information products being sold with respect to importation. The funniest fact about this trend is that most of the marketers of such books have never imported even a pen into Nigeria, yet they are selling thousands of copies of books to gullible Nigerians. Jumping into an industry blindly is one of the reasons why there are a lot of failures in the business world. If I were to venture into the business of importing as a novice, I will first spend about six months to a year, learning the ropes from an established importer; not a marketer with a hyped up sales letter.

  • Success in one industry does not translate to success in another industry

Most people who read my blog usually think of me as a guru or whiz kid of some sort. Yes I have built some successful businesses but I have also had my own share of failure. The principles of business is the same throughout the world but industry challenges, economic conditions, demographic and territorial challenges makes the difference. What this mean in essence is that the being a successful business owner in a particular country or industry does not mean you will succeed if you venture into another country or industry.

The fact that Aliko Dangote is a successful cement manufacturer does not mean he will succeed if he ventures into the computer industry. The fact that Bill Gates is a software mogul does not mean he will succeed as a cement manufacturer. The rules and playing field of every industry is unique and to thrive in any industry, you must be willing to learn and do the dirty work involved. The rules of the business world is no respecter of persons.

Today, I am quite popular and known in several countries of the world. Thanks to my business blog StrategicBusinessTeam.com which is now averaging 150,000+ Visitors monthly and the number is growing rapidly. But what most people don’t know is that prior to starting this successful blog, I already had a painful experience with my first blog BestBusinessMentor.com; which failed due to my technical incompetence.

Another fact most people won’t know is that despite my success with StrategicBusinessTeam.com; I still failed to get two blogs off the ground in 2012, despite investing time and capital in such projects. The fact that I was able to build a successful business blog does not mean I can build a success health blog; even though the technical challenges involved are the same. This is why I said that success in one industry does not translate to success in another industry. Now if you must know the two blog project that failed, they are:

InvestingAdviceforBeginners.com – This blog had potential and was actually growing and generating income but I had to scrap the project because I realized that business and investing are correlated. What stops me from sharing such investment advice on StrategicBusinessTeam.com instead of splitting the effort and increasing my overhead. That was how this blog died.

BellyDancingFun.com – This niche was well researched and I even spent a considerable amount of money on the research, planning and the written content. But the sad truth about this blog is that I lack the passion to run it and I am not even interested in the subject of dancing in general; not to talk of belly dancing. I don’t even have the passion to promote it or invest further resources into it, so it is just lying there.

Now what am I trying to pass across to you? The message I want you to take home today is that you can still fail even if you are given the best idea in the world. The reason I say this is because ideas, opportunities, capital, and every other needed factor for success in business is not enough, you need passion to get things going and even when you succeed, you need passion to sustain the momentum. That’s the reason why billionaires such as Dangote, Warren Buffett, Donald Trump and Mike Adenuga are not resting on their laurels despite being among the richest men in the world. It is all about passion; so stick with what you know best.

  • To get the best result, be tough

This was a bitter experience I learned in the process of setting up my new business. After getting an office location, I had to do some interior work so as to get the office up to my taste and create a work environment that will be conducive for my employees. To get this done, I had to work with electricians, painters, welders, etc and in the course of work, I tried to be good to them. I treated them with respect, gave them extra money and pecks, and paid them well. But what did I get? Nothing. Work that should have been executed in three days at most dragged on to over a week and my cash was dwindling rapidly. I treated them with respect and they took my kind nature for granted. Then I changed and adopted a new strategy. I got mean, yelled, threatened and wore a sad face. They said even bad things about me but guess what? The job got done and that’s all I care about.

“Don’t be too familiar with your followers; it may at first inspire affection but eventually, like all familiarity; it will breed contempt.” – The Mafia Manager

After much thought, I came to fully understand that humans by nature perceive kindness or being soft as a weakness; and they take you for granted because of it. But when you are mean, harsh and tough; you bring out the best in people. I knew this fact right from time but I thought things would be different this time. Unfortunately, humans will remain humans.

Starting a New Business: Nine Bitter Lessons I Learned this Year

  • To hit your goals, get a goal accountant or enforcer

Right from the moment I set this goal in 2012, I have been bouncing from one challenge to another and I encountered problems I never anticipated. In fact, I almost gave up the goal because my mind was filled with doubts and I could see one hundred tangible reasons why I don’t need to stress myself pursuing such goal.

In utmost sincerity, I want to say that this goal would never have been achieved if not for a good friend of mine named “Precious.” He gave me the mental support I needed, he encouraged me and most importantly, he refuse to listen to my lamentations or complaint and he gave me no room to wallow in self pity. Despite the challenges, problems, my incessant complaints and unenthusiastic attitude; he refused to budge and instead kept pushing me harder. As I write this now, I am so full of gratitude to him.

Another reason I kept pressing forward despite the strong urge to quit the process was because I had shared this goal openly with everyone on this blog. When I set this goal, I received a lot of encouragements, feedback and a few criticisms. Most people who wrote me were eager to see how far I will go with the project.

To you my loyal reader, I say thank you and the reason I am thanking you is because if I hadn’t been outspoken about this goal or project, I would have abandoned the project quietly and move on. But because this project was an open one and I was accountable to you, I knew deep down in me that I must report back to you regardless of the outcome; be it success or failure. I also knew this goal of mine will motivate a lot of my readers and spur them to action; that was why I refused to give up.

“I intend to be, the richest man in the world.” – Howard Hughes

So if you intend to engage in a similar business or investment project, get a goal accountant. Such a person could be a family member or friend but he or she must be able to advice and hold you responsible for your actions without sentiment or bias. Another tactic you can use to achieve your goals is to tell people about it. Being outspoken about your goals will keep you on your toes and you will be held accountable by those you have told your goals.

When I was a teen, I remember telling my childhood friends about my dream to be a rich man with several businesses. But they scoffed at me because they felt I was too ambitious, too money conscious and out of place. I looked stupid back then because while my mates were bragging about attaining the highest academic status or qualification, I was talking about business and money. But today, I am proud to say that my dream is still alive and on full steam. Now am I the only one that talks openly about my personal goals? The answer is no.

“I think I am very goal oriented. I’d like to win the America’s cup. I’d like Oracle to be the No 1 software company in the world. I still think it is possible to beat Microsoft.” – Larry Ellison

“I want to put a ding in the universe.” – Steve Jobs

“I always knew I was going to be rich. I don’t think I ever doubted it for a minute.” – Warren Buffett

“I intend to be, the richest man in the world.” – Howard Hughes

Pat Flynn of SmartPassiveIncome.com regularly talks about his goals and dream; and he pursues it vigorously because he knows he will be held accountable by readers. Aliko Dangote once shared his goal about being Africa’s greatest industrialist and he has hit the goal. When Richard Branson was a teenager, he shared his dream about building a brand that will span different industries and sectors of the economy, in different countries. The board of directors of the company that wanted to acquire his “Student” magazine thought Richard Branson was crazy and withdrew from the deal. But today, the “Virgin Group” founded by Richard Branson is a conglomerate of over 400 companies. Who says it does not pay to share your dreams aloud?

  • It takes pain and sacrifice to be focused

“And here is the prime condition of success, the great secret. Concentrate your energy, thoughts and capital exclusively upon the business in which you are engaged in. Having begun in one line, resolve to fight it out on that line; to lead in it. Adopt every improvement, have the best machinery and know the most about it.” – Andrew Carnegie

Most success coaches and motivational speakers emphasize the need to be focused on a particular goal or field. From my personal experience, I can attest to the fact that “focus or concentration” on a given purpose is a requisite for success in any endeavor. But what most success coaches and speakers will not tell you is that it takes pain and sacrifice to be focused. In fact, they make it sound easy but it is not.

“The sun ray does not burn, until it is brought to a focus.” – Anonymous

To stay focused on a specific goal or primary task without diverting your attention to something else; even when such secondary task seems profitable takes a lot of discipline, pain and sacrifice. In the course of pursuing this business project, I came across a lot of promising investment opportunities, I had several personal needs and problems pop up here and there; but I refused to take my eyes off the goal, I refused to divert cash set aside for this project into something else.

Now why should you invest such money in a long term business venture when you can play the stock market and gain 50% – 100% in less than six months? In the third quarter of 2012 alone, I made 87 percent profit on my invested capital through the stock market. But I would have made more money if I had increased my share volume, by investing the money meant for this business project. This is the reason why I said focus takes pain and sacrifice. If I had taken my attention off this startup project to pursue other promising investments, I wouldn’t be where I am today. Being focused pays, especially in the long run.

  • Your health is more important than money

From the 1st of January 2013 to the 1st March 2013, I was always on the move trying to get this business venture off the ground. During this period, I was running around trying to get an office space, dealing with craftsmen and artisans to get the office in order, getting office equipment and appliances, hiring employees, running my businesses, etc. Before I knew it, my health broke down and I was ill for about five days. During those five days I was down with illness, nothing mattered to me. The business project, investments and every other deal I was involved in never mattered any more. All I thought of and cared about was my health. Health is the most important thing, because without it, every other material thing is useless. So take care of your health first; then every other thing can follow.

  • Start small, run lean and grow slow

The media is filled with stories of individuals and businesses that grew fast and became big in the shortest of time. People love stories of overnight success and achievements. Also, I have met individuals who have plans to build million dollar businesses and they are trying to raise a large capital for such projects; but these same individuals have never even operated a small business. I am a sole believer in the concept of starting small, running lean and growing slow. One of the reasons this project dragged this long is because I self financed this business from the scratch. Yes, there were easier options for me to source for funds and get the project running speedily but like I said earlier, I prefer to start small and grow slow.

I also advise you go the same route. If you can self finance your proposed business idea, then do it, even if it means starting small. Don’t be deceived by the news of companies or startups raising millions of dollars in capital. As an entrepreneur, I want to tell you that raising millions of dollars in capital does not mean you are profitable; and the most important word an investor wants to hear is “profit.”

I have seen businesses raise millions in capital and still went bankrupt. So the fact that you were able to secure venture capital does not make your business successful; Digg.com and MySpace.com are good examples of this scenario. Startup funding is all about scaling up, it is not a sign of profitability; it is an insignia of potential. The ability to generate profit consistently is what makes a business successful. So don’t be deceived by media hype, start small, run lean and grow slow. When your business begins to turn in profit, then you can seek funding to scale up your operations. A word is enough for the wise.

  • It is the Little things that make the big difference

In business, most people look at the big things like the assets of a business, the revenue and the value of the business. But savvy entrepreneurs and investors know that it’s the little things in business, like cash flow and liquidity that can make the big difference. Do you know that a man can be worth $100million and still be broke? So also can a business have millions based on asset valuation but such business can still fail due to cash flow problems or lack of liquidity. This was one of the lessons I learned in business and I re-learned this lesson again recently. I don’t want to go into details of what happened but the lesson I want you to take home is this: “take care of the little things in business, because they make the big difference.”

As a final note, these are the nine lessons I learned from the process of starting a new business from scratch. But I want you to know that the battle is not over yet and there are more lessons to be learned. Starting a new business is just the starting point; there is still a lot work to be done. Now if you are one of those individuals that have been sitting on their idea for too long, it is high time you get down to work because if you are waiting for the right time to act, such time will never come. Start with what you have now, and you will find the rest along the way.

Best Small Business ideas

Are you an entrepreneur looking for the best small business ideas for 2013? Do you need a list of business ideas for beginners or startup business ideas with low investment? Do you want to quit your job this year and start a business? Then please read on because this article is for you.

I once wrote an article on how to make a million dollars fast and how to start a business with no money. So i this article, I will be revealing the best small business ideas, best franchises opportunities, new startup business ideas, home based business ideas for students and who wish to take the entrepreneurial bull by the horn this year. This list of entrepreneurial ideas will prove useful to all entrepreneurs; regardless of the available start up capital.

An entrepreneur with a startup business capital of $1,000 or less can take advantage of the business opportunities list here just as the entrepreneur with a million dollar startup capital. The only difference between these two classes of entrepreneurs will be their level of play. So don’t be deterred by the magnitude of startup capital at hand; after all, Rome was not built in a day.

Before I list my best small business ideas for the year, I want to clearly state that this list does not in any way replace the need for you to do a feasibility study and come up with a winning business plan, so take note. Also bear in mind that this list does not in any way minimize the business challenges involved with starting a business; neither does it make the entrepreneurial process easier, nor does it eliminate the risk of business failure.

  Who will Benefit Most from these Proven Successful Small Business Ideas

  • Men
  • Young people
  • Entrepreneurs
  • Women and House wives or Moms
  • Kids and Teens
  • College students
  • Employees and Civil servants
  • Retirees

  A useful advice for those seeking the top small business ideas for 2013

In as much as I have taken pain to prepare this list, I want to point out an honest truth and that truth is this:

“There is nothing like the best business idea or opportunity. There is nothing like the best business environment or business plan, you just have to work with what you have and understand it to the core.”

The truth is that you can find success in any industry or sector you choose. All you need is to understand your customer’s need and add a little innovation to your business. So whether you are searching for internet business ideas, good work from home low capital business ideas or manufacturing business ideas; you will surely find this article useful. I think I have said it all; it’s up to you now to either accept the reality or continue to chase shadows. So if you are still ready for something new; then read on as I share with you 50 great startup business ideas for the year.

How to Create or Choose the Best Small Business Ideas

 Top 50 List of Best Small Business ideas: Startup Business ideas for 2013

  • Start an internet business

Best Online Business ideas – Do you intending starting an internet business or a brick and mortar? Well, regardless of the industry you intend breaking into or the business idea you have your sleeves; it is advisable you build an internet company around it. Putting your business on the web is probably the best venture ever. Why? The reason is because the internet is still a rapidly growing trend, thus making an online business a hot one. All you need to start your own internet business is just a little innovation on your already existing idea. Jeff Bezos did it with Amazon, by putting a bookstore on the web. You can do the same.

  • Start a food retail or wholesale business

Food retail business is one business I am passionate about; especially staple foods. Why? The reason is because humans must eat to survive. Regardless of the economic condition, or your personal financial situation; you must eat. With an ever growing demand for food worldwide, propelled by a rapidly bursting population; the food business is something you should start today.

  • Green business ideas

Green Business ideas – The green business industry is a rapidly growing trend. Just as the internet was a fast growing trend in the 80s, the green business is the next wave of trend that will create millionaires and billionaires. In fact, this is an innovative hot business opportunity with a future potential. With a increase in eco-consciousness and the need to conserve energy; you definitely need to go green now before it’s too late. You can practically venture into the industry in any capacity; from retailing energy bulbs, solar panel and installation, inverters and power generators, etc.

  • Start a cleaning business

How to start a janitorial business – You can start a cleaning business in any capacity ranging from carpet cleaning, floor cleaning, roof cleaning, office cleaning, foreclosed properties cleaning, home cleaning, etc. You can also operate this business on a part time basis.

  • Start a poultry business

How to start a poultry farm business – The poultry business itself is a broad niche. You may decide to focus on Domestic fowls or hen, ducks, quails, turkeys, guinea fowls, peacocks, etc. You may also decide to go into operating an incubator or hatchery, poultry feed production and retailing, egg production, etc.

  • Start a catering business

How to start a catering business from home – As a caterer, you can choose to go into full scale catering services alongside event planning services or you may decide to specialize on food cooking, snacks baking or cakes, barbeque preparation, etc.

Service Business ideas

Industry Based Business Ideas

Regional Business ideas

Gender Based Business ideas

 Skill Acquisition

Top 50 List of Best Small Business ideas: Startup Business ideas for 2013

Small Scale Business Opportunities

Five Conditions That Makes a Business Opportunity Feasible

What makes a business opportunity feasible? How do i identify a good business idea or opportunity? How can i determine the profitability of a business venture before investing in it? I advice you read on to find out.

Everyday, I come across entrepreneurs who are so excited because they have just thought up a new business idea or discovered a business opportunity with massive potential. Being an entrepreneur and investor, I am often privileged to have a sneak preview of business investment opportunities before they are launched or made public.

Sometimes, I am given the opportunity to invest in such businesses. Now how do I know the right business opportunity to invest in? What benchmark do I use to analyze the potentials of a business opportunity? What makes a business opportunity feasible? How do I know if my business idea is viable? If you are willing learn the secrets to finding feasible business opportunities, then read on.

In this article, I am going to highlight five factors you can use as a yardstick to know if the business opportunity you are pursuing is feasible. The five factor I am about to highlight does not in any way replace the need for a detailed feasibility study. To know the preliminary feasibility or viability of your proposed business opportunity, the checklist below will help you.

  Five Conditions That Make a Business Opportunity Feasible

1.  Real demand

The first condition that makes a business opportunity viable is market demand. Your business idea or opportunity must have real market demand. Your business opportunity must either satisfy a need or solve a problem.

2.  Good return on investment

The next condition that makes a business opportunity feasible is the ROI. Any business opportunity you intend to pursue must show a strong possibility of yielding a good return on investment. Moreover, all a business is meant to do is to either satisfy a need or solve a problem for a profit.

3.  Competitive

The third condition that makes a business opportunity feasible is its competitiveness. Except your business idea is the first of its kind, there is bound to be competition. If your business idea or opportunity is not competitive, just forget it because it will never stand a chance.

4.  Meet the objectives of the entrepreneur

This point is very clear and easy to understand. Before ever starting a business, there are certain aims and objectives you intend to achieve using that business as leverage. For a business opportunity to be viable, it must meet your objective.

5.  The competence of the entrepreneur and his team

Lastly, the most important factor that makes a business opportunity worth pursuing is the competence of the entrepreneur and his business management team. A business opportunity will only be feasible if it is backed by a strong business team. I say this because I have seen good and solid business opportunity fail to breakthrough because of the incompetence of the team.

In conclusion, these are the five conditions I use to determine the preliminary feasibility of any business opportunity I intend to take advantage of and I hope they will serve you as well.

5 Reasons Why You Must Conduct Feasibility Study before Starting a business

What is the importance of conducting feasibility study before starting a business? Can conducting feasibility study give your business an advantage and help reduce the high rate of business failure? Well, i advice you read on.

A feasibility report is an often ignored but vital prerequisite to building a successful business from scratch. In fact, not doing feasibility is one of the silly mistakes entrepreneurs make when starting a business. So in this article, i will be stressing the need to conduct feasibility study.

“Starting a business is like jumping out of an airplane without a parachute. In mid air the entrepreneur begins building a parachute and hope it opens before hitting the ground.” – Rich Dad.

Few years ago, before starting a business of my own, I was privileged to assist my dad in overseeing the affairs of his business. Our little company was in the business of importing and distributing sanitary wares. Business moved on smoothly for many years till we began to experience a decline in sales and decrease in profit margin due to stiff competition and inconsistent government policies. My dad decided to diversify so he made a move into the clothing line based on the recommendation of a nephew.

Since he started his first business from scratch without conducting a feasibility study, he thought he could repeat the feat in the clothing line. As expected, the business flopped in less than two years due to many unforeseen factors I wouldn’t want to mention here and we lost a lot of money. Though this experience was painful, I learned a lesson I will never forget in my life and that is: “The Importance of Conducting a Feasibility Study before Starting a Business.”

I know many out there have made this same business mistake and many are still to bound to make it. Having shared my story; let me highlight five reasons why you need to conduct feasibility study before starting a business.

 5 Reasons Why You Must Conduct Feasibility Study Before Starting a business

1.            A feasibility study will help you to determine the profitability of the business venture. Before starting a business, seasoned entrepreneurs and investors would want to know if the business would be worth their time, effort and resources. It is worthwhile to know that many entrepreneurs have abandoned solid business ideas because the profitability could not be ascertained on conducting a feasibility study on the business idea.

2.            A feasibility study will help prove to the entrepreneur, venture capitalists, lenders and investors the existence of the market, the liquidity of the business venture and the expected return on investment.

3.            A feasibility study will help you identify the flaws, business challenges, strengths, weaknesses, opportunities, threats and unforeseen circumstances that might affect the success and sustainability of the business venture. Just like the case of my dad’s business, the business failure and loss of money would have been avoided if we had carried out a feasibility study. We simply jumped in based on someone’s recommendations because we were flushed with cash and we paid dearly for it.

4.            Before starting a business, a feasibility study will enable you estimate the financial, human and technological resources that will be needed to ensure the successful launching of the business. Feasibility study helps to reveal the number and level of skill or unskilled workers to be employed and their salary scale.

5.            Feasibility study will help you to determine the amount of capital required to start the business. It will also help you in establishing the budget plan, working capital and cash flow projections of the business.

As a last note, my advice to you is this:

“Never invest a dime without first carrying out feasibility study on the business idea.”

10 Small Business Success Secrets of Aliko Dangote

Culling from a popular quote that says “if you want to be rich and successful, observe what the rich are doing and do the same.” I don’t know how effective this strategy can be but I feel there is an atom of truth in that statement.

Today, I will be sharing with you some small business success secrets from one of my mentors; Aliko Dangote. This mentor of mine is extremely rich and has been ranked as the richest black man in the world by Forbes Magazine.

So if learning and understudying the rich can give us insights into their business success secrets if building a business from scratch is your utmost priority, then I am sure we are definitely going to get some hard core business tips from this billionaire. Below are the ten small business success secrets of Aliko Dangote; the richest black man in the world.

  10 Small Business Success Secrets of Aliko Dangote

1.            Manufacture; don’t just trade

Aliko Dangote started business as a trader of commodities; he gathered business confidence and experience as he grew. In an interview granted, he openly admits that one of his greatest business moves was moving from being a trader to being a manufacturer.

He summed it up by saying,

“Manufacture, don’t just trade. There is money in manufacturing even though it is capital intensive. To achieve a big breakthrough, I had to start manufacturing the same product I was trading on; which is commodities.”

I am an advocate of manufacturing because it does not only improve your business status, it also helps you give back to your community and country; with respect to job creation and economic development.

2.            Build a brand, and don’t destroy it

This is the second small business success secrets of Aliko Dangote. Aliko Dangote is one of the firm believers of the “Brand Power” and this is what he has to say about it:

“To succeed in business, you must build a brand and never destroy it. One competitive advantage I had when I ventured into manufacturing was my brand “Dangote,” which I diligently built in the course of my trading commodities.” – Aliko Dangote

Sometime ago, Coca Cola’s assets were estimated to be worth $3billion but the brand name alone “Coca Cola” was valued at over $80billion. That’s the power of a brand. So why not start building a brand today? Your brand could be your saving grace in hard times; it could also turn out to be a very strong competitive advantage for your small business.

3.            Sell cheap, give quality and don’t kill the competition

To build a successful business, Aliko Dangote emphasizes the importance of selling quality products at affordable price. Selling quality products at an affordable price helps in increasing customer’s loyalty.

With respect to competition, Dangote has this to say;

“Don’t kill the competition. Competition is healthy for businesses. It keeps you the entrepreneur on your toes.” – Aliko Dangote

“There is one rule for the industrialist and that is: make the best quality goods possible at the lowest price possible, paying the highest wage possible.” – Henry Ford

10 Small Business Success Secrets of Aliko Dangote

4.            Start small but dream big

“I built a conglomerate and emerged the richest black man in the world in 2008 but it didn’t happen overnight. It took me thirty years to get to where I am today. Youths of today aspire to be like me but they want to achieve it overnight. It’s not going to work. To build a successful business, you must start small and dream big. In the journey of entrepreneurship, tenacity of purpose is supreme.” – Aliko Dangote

5.            Have connections and pray for a big break

The next small business success secret is business connections. Aliko Dangote is respected for his strong network of business and political connections. You can build your connections and strengthen your network in the business world by increasing your corporate social responsibility, signing joint ventures and partnership deals, forming strategic alliances, attending business events and parties, making political donations and paying courtesy visits to those at the helm of affairs.

To survive in business, you must strengthen your business connections and network. And most importantly, you must pray for a big break. Big breaks are very vital to entrepreneurial survival. In fact, I can hardly point to any successful entrepreneur that wasn’t thrust upwards by a big breakthrough.

  • Bill Gates had his big break when he negotiated and signed a deal with IBM.
  • Aliko Dangote had his big break when he secured a license to import cement. Oprah Winfrey had hers when she started Harpo Studios Productions and acquired the full rights to her shows; “The Oprah Winfrey Show.”
  • Li Ka Shing had his during a riot period and he began buying properties at rock bottom prices.
  • Larry Ellison had his when he secured a deal to build database software for the CIA. The list goes on and on.

So if you really want to take a giant stride in business, you must not only pray for a big break; you must seek it out and be prepared for it when it comes.

6.     Believe there is money to be made in your country

Dangote believes one of the main prerequisite to building a successful business and ultimately becoming rich is developing a firm belief in your country. Dangote is a firm believer in his country Nigeria. He believes opportunities abound everywhere but it just takes a smart eye to see them. He encourages everyone to seek opportunities in their own country instead of seeking greener pastures in other countries.

7.      All work and less play makes Jack a rich man

A popular saying goes “all work and no play makes Jack a dull boy,” but billionaire Dangote believes that all work and less play makes Jack a rich man. Hear him:

“I enjoy myself a lot but I derive more joy in working. I believe in hard work and one of my business success secrets is hard work. It’s hard to see a youth that will go to bed by 2am and wake up by 5am. I don’t rest until I achieve something.” – Aliko Dangote

My mentor has said it all but I want to add something crucial and that thing is this; “working hard alone doesn’t guarantee success, you must also work smart.“

8.     Give back to those who made you

I hope you are conversant with the saying that goes “no man is an island.” You can never get rich alone. There have to be contributing factors and individuals you will need to leverage upon. Dangote believes in the principle of “give and it shall be given unto you.” Just as stated above, one of the small business success secrets is this; you must give back to those who made you.

“No man becomes rich without himself enriching others.” – Andrew Carnegie

Now who are those who made you? These are individuals or entities you leveraged upon to get to the status you are now. They are those who gave you a helping hand when you needed it most.

They could be those who gave you business contacts, connections and encouragement. They could be business associates, political associates, investors, loyal customers, good suppliers, political associates, your employees, business team, business partners and so on.

9.     Obey the laws of the land

“Why risk going to jail by engaging in illegal businesses when it is easier to make money legally? – Rich dad

Dangote advises entrepreneurs to be law abiding citizens. He encourages everyone to do business as outline by the regulatory bodies. Obeying the laws of the land also entails keeping your credit and tax record clean. Nothing hurts more than striving to build a business empire only to have your assets impounded or frozen by the authorities. So do the right thing.

10.    Business must flow in your blood

Lastly, Aliko Dangote revealed that you must have business flowing in your blood if you really want to make it big as an entrepreneur. I solely agree with him. Look at all successful entrepreneurs, they seem to possess a different kind of spirit. That’s the entrepreneurial spirit.

Everything around you must smell business. That is to say you must think business, dream business and live for business. It’s all about the entrepreneurial spirit. The same spirit that kept Warren Buffett in the game even at old age, the same spirit that drives General Electric even after the death of its founder; Thomas Alva Edison. Without this spirit, you will ultimately fail.

Business flowing in your blood entails tenacity, doggedness, shrewdness and every single attribute required to keep you going in the game of entrepreneurship.

3 Difference between Feasibility Study and Business Plan

What’s the difference between a feasibility study report and a business plan? Can a feasibility report be converted to a small business plan? Well, I will advice you read on to find the answers you seek.

Now there seem to be a mix up between feasibility study and business plan. While some say they are the same, others argue they are not. So I want to use this medium to draw a line between a feasibility report and a business plan. Though the process involved in developing a feasibility report and a business are similar, I will reveal to you some basic difference between conducting feasibility study and writing a business plan.

3 Differences between Conducting Feasibility Study and Writing a Business Plan

1.            A feasibility study is carried out with the aim of finding out the workability and profitability of a business venture. Before anything is invested in a new business venture, a feasibility study is carried out to know if the business venture is worth the time, effort and resources.
On the other hand, a business plan is developed only after it has been established that a business opportunity exist. This simply means that a business plan is prepared after a feasibility study has been conducted.

2.            A feasibility report is filled with calculations, analysis and estimated projections of a business opportunity. While a business plan is made up of mostly tactics and strategies to be implemented in other to start and grow the business.

3.            A feasibility study is all about business idea viability while a business plan deals with business growth plan and sustainability.

I hope this few words have been able to point out the key differences between feasibility study and business plan. I feel it’s also worthwhile to know that a feasibility report can readily be converted to a business plan. To achieve this, all you need to do is incorporate your business strategies and tactics into the feasibility report; and you are good to go.

A Complete Sample Business Plan Format, Template and Outline You Can Use As a Guide

Do you want to learn how to write a business plan for small business? Do you need a sample business plan template? Or you just need a complete small business plan format or outline? Then read on.

Today, I want to share with you a practical sample business plan format and outline. It outlines everything that I covered in the my previous posts with respect to writing a business plan that attract investors, so seat back, read and digest.

                A Complete Example of a Business Plan Format and Outline You Can Use As a Guide

Business Plan: Rainbow Kites, Inc.

SUMMARY

BUSINESS CONCEPT

The Kite industry has expanded rapidly in the past several years and growth is expected to continue at a strong pace for the foreseeable future. This offers excellent opportunities for new companies to enter this market. We intend to address the needs of customers in this market who seek higher quality, higher priced kites. We will address this need by importing, selling and distributing higher end kites in the US and Canada. Distinguishing characteristics of our business will be top quality products, special emphasis on higher end independent retailers, and high level of service.

CURRENT SITUATION

We are a start-up company, incorporated in 1998 in the State of California. The principal owner is Tom Anderson whose title is President and who has many years of experience in the toy industry. Other key personnel include Nancy Anderson, his spouse who has experience in customer service, bookkeeping and office work. At this time we are seeking additional equity capital to compliment our own equity investment and seeking to arrange a bank line for inventory and receivables financing. We have firm commitments to distribute several highly sought after overseas kite manufacturers and have verbal commitments from independent retailers primarily along the West Coast to stock our products. We hope to ship our first products within six months of finalizing financing arrangements.

KEY SUCCESS FACTORS

The success of our business will be largely a result of superior products, superior service, extra attention to detail throughout our operation, personnel and our high level of experience in the industry.  In particular what really sets us apart from the competition is that we are ONLY going to sell high end kites and we are ONLY going to sell to higher end outlets. This will allow us to give absolutely top service and product selection for these accounts without getting distracted from the very different product and service demands of the more mass market outlets.

FINANCIAL SITUATIONS/NEEDS

In order to effectively launch the business, we project a total need for $300,000 in equity financing. Principal uses of the funds will be to finance operations until cash flow becomes positive and to create a stronger balance sheet in order to help secure additional bank lending against to finance inventory and receivables. To date we have raised $132,000 from founders, Tom and Nancy Anderson, and their relatives. We project that the company will be profitable within two years. We project that within three years of reaching break-even that this new investment could be cashed out by either the founding partners purchasing this investment stake or by replacing the investment stake with additional bank financing.

Sample Business Plan Template

                VISION STATEMENT

Our vision of what our company will become in the future is to have developed relationships with key retailers so strong that they will view us more as indispensable partners, than just another supplier. We will work closely with each retailer we serve to recommend product assortment unique for their customer base, appropriate stocking levels, pricing and display assortments. We will constantly seek out and work with the manufacturers we represent to deliver the most innovative and exciting products possible to the retailers we serve.

MILESTONES

1. Overseas manufacturers agreements in place…done.

2. Verbal commitments from many West Coast retailers…done.

3. Presentation to potential investors…underway now.

4. Presentation to potential banks for inventory and receivable financing…underway now.

5. Financing commitments in place..60 days.

6. Product catalog completed…30 days…

7. Additional sales reps being recruited…underway now…

8. Sales rep selection finalized…60 days.

9. Warehouse lease signed…90 days.

10. First written orders from retailers… 75 days.

11. First orders to manufacturers…110 days.

12. First shipments from our warehouse…160 days.

MARKET ANALYSIS

THE OVERALL MARKET

The overall size of the industry is currently $150 million in the US and Canada. Because the industry includes a very diverse group of product types with significantly different characteristics, it is more meaningful to break out analysis of the industry into roughly two groups. The first group and by far the larger unit volume are lower end kites sold primarily through mass market outlets such as discount department stores. The second group are higher end kites that are sold largely at independent and specialty chain stores. While the unit volume is much less, the dollar volume is approximately the same ($75 million) as that for lower end kites because the average price point is much higher.

CHANGES IN THE MARKET

The most significant development in this marketplace recently has been the shift in toy and kite business away from independent stores to national mass marketers over the past decade. However, recently this trend has slowed as independent toy and novelty retailers have become better at differentiating themselves and their product selections from those offered by national mass marketers.

MARKET SEGMENTS

The market is primarily segmented by distribution channel. The mass market retailers are looking for low-priced products and a high percentage of their products are licensed merchandise, for example based upon kid’s cartoon characters. Independent specialty retailers however are trying increasingly to be as different from the mass merchants as possible and are generally selling much higher priced product and seldom want merchandise based upon licensed cartoon characters.

It should be pointed out that there are few stores that sell just kite merchandise–even among independent specialty stores most of the volume in kites is sold at stores that sell a wide assortment of other merchandise such as toys or other novelty items.

TARGET MARKET AND CUSTOMERS

Our target market is independent and small chain merchants that are committed to selling higher end kite products. We particularly want to focus on accounts that just sell higher end kite products and that are committed to stocking a selection of at least a dozen different kite products. These accounts we feel offer the best growth potential and will benefit the most by the help we can bring to them in selecting and displaying our higher end merchandise.

CUSTOMER NEEDS

The basic need of target retail customers is to differentiate their store from mass market stores and give customers a reason for shopping their store and paying significant premiums for their products instead of getting a low-end product at a discount department store.

These stores really appreciate stocking a line that is not sold at mass market accounts. They also appreciate dealing with an importer who is committed to specialty stores exclusively, not mass market accounts.

CUSTOMER BUYING DECISIONS

The buying decision is almost always made at an in-person sales presentation. The personal touch appears to be essential for moving buyers to action for this product because at these high end retailers are very demanding about the product quality being stocked in their stores. They insist upon seeing finished products, not just mock-ups or catalog pages. Some purchases are made at trade shows, but only a small percentage.

Sample Business Plan Format

COMPETITIVE ANALYSIS

INDUSTRY OVERVIEW

Across the US and Canada there are many firms that distribute kites. The vast majority however distribute only one or two low end kites as a very small part of their overall distribution business.

There are several distribution firms that offer between a dozen and as many as one hundred kite products. These firms represent many different products and the sale of kites represents a very small fraction of their business. These firms also to a wide variety of outlets including mass merchant accounts.

CHANGES IN THE INDUSTRY

The big change in the kite industry over the last few years has been the concentration of lower end kite sales in mass market accounts, along with a strengthening market for higher end kites in upscale specialty accounts.

Current distributors representing larger kite product lines while still selling to a wide variety of outlets, have tended to focus most of their efforts on selling lower end products to mass market type accounts–where their revenue is much greater.

OPPORTUNITIES

While the competition is well-established in, and gives a lot of focus to, current major markets for this product, they are much less aggressively pursuing the higher end kite market. This market offers terrific potential because it has significant growth potential, and the competition is not well-entrenched here. Furthermore, this market differs from the other markets in the many important ways. While this market may not be the largest, it appears a very solid opportunity for a newer competitor.

THREATS AND RISKS

Because we are a small firm, we do not anticipate a meaningful or prompt reaction to our market entrance from our larger and more established competitors. We think a strong reaction from existing distribution firms is particularly unlikely because the primary competitors derive only a very small percentage of their business from kite sales, and even that revenue is largely from mass market accounts that we plan on avoiding. However, we have developed contingency plans for certain reactions that competitors may make. If a competitor lowers their prices on the exact same product we are offering we will match their price on that product. But we intend as much as possible to emphasize products that our competitors are not selling to begin with.

STRATEGY

KEY COMPETITIVE CAPABILITIES

We are better positioned than our main competitors to take advantage of the increasing demands of upscale independent specialty stores to sharply differentiate their kite selection from those of mass merchants. Because we are going to focus exclusively on importing higher end kites for independent specialty stores we will be much better able to serve their needs than current distributors who handle many items other than kites and also give their primary attention to larger mass merchandise customers.

Tom Anderson’s extensive experience in the toy business and his solid knowledge of the kite market in North America, his personal contacts at independent retailers on the West Coast and his contacts at overseas suppliers give us a strong competitive advantage.

Nancy Anderson’s background in running offices and handling customer service issues will give us a strong service advantage.

KEY COMPETITIVE WEAKNESSES

Our primary weakness is that we are a new business competing largely against established firms. To significantly build sales, we must not just find new customers–we must take customers away from existing firms. However by offering a superior selection of kites and focusing exclusively on upscale independent stores we feel will can quickly open accounts at many retailers and build strong relationships. Co-founder Tom Anderson has had many discussions with owners and buyers at retailers that confirm this opinion.

Another disadvantage we have is stronger personal ties with accounts on the West Coast of the US and Canada than in other parts these countries. We plan on offsetting this weakness by hiring experienced commission reps for other territories. We have already had preliminary discussions with several highly successful reps and these reps have shown interest in continuing discussions with us.

Financially we do need additional funding. But after the targeted funding is in place we will have ample financing for the foreseeable future.

STRATEGY

Our strategy is to focus 100% of our efforts on the market for upscale kites. By focusing all of our effort and energy on this particular niche, we expect to quickly develop and maintain a leadership position. While other firms try to be all things to all people, we believe that our singular focus will give us significant advantages. Most of the firms serving this niche now also serve much larger markets and give only secondary attention to the upscale. On the other hand, our firm will give our total focus to this niche; our key people will stay in personal touch with customers in this niche; and we will be able to respond to changes in this market much faster than our competitors.

We will offer the best, most highly personalized service in the marketplace we serve. Especially being a very small, owner-operated company, we intend to use this to our advantage to be absolutely certain that every one of our customers receives excellent service. We will go out of our way to make sure that our customers know that they truly matter to us. For example we will carefully recommend seasonal inventory plans for each store that reflects the customer traffic that the store receives. We will also make display suggestions and to create a number of displays that can be adopted to the needs of particular stores. Sales reps and in-house employees who deal with customers will be carefully trained and will be given wide latitude for insuring that customers are always satisfied.

Sample Business Plan Template

PRODUCTS/SERVICES

PRODUCT/SERVICE DESCRIPTION

Our underlying philosophy in selecting products has been to choose lines that will bring excitement, surprise and satisfaction to demanding higher end customers. We personally test each individual product. Special attention is giving to ease of assembly, durability, and general overall attraction.

We prefer to choose lines that we can represent exclusively, but because our first priority is on representing top-of-the-line merchandise, we have agreed to take on two leading lines on a non-exclusive basis.

A complete draft copy of our first catalog detailing our initial product lines and products is available upon request.  An important component of our business is not just our products but our service. These are some of the important service elements we offer:

-Stocking of all products offered in our West Coast warehouse, avoiding long waits to fill orders from overseas

-Detailed advice on inventory planning and sales forecasting for individual stores

-Display fixtures custom built to suit the needs of our customers

-Full returnability for any product defects

-Coordination of co-operative advertising programs with manufacturers

POSITIONING OF PRODUCTS/SERVICES

We intend to position our business not just as a distributor of products, but a partner bringing a high level of service to the stores that we enter into business with.

We will work with stores through merchandise selection and display options to significantly increase the sales and profitability of their kite business. By doing this we expect to develop a strong loyalty among our customers.

Small Business Plan Format

 SALES AND MARKETING

MARKETING STRATEGY

Our basic marketing strategy is to work with our retailers on a one-to-one basis to develop unique marketing programs for them. Especially because we want to develop close working relationships with our customers we want to establish accounts in as personable a way as possible too. Hence we will overwhelmingly emphasis in-person sales calls to build accounts.

We will closely integrate all of our marketing and sales efforts to project a consistent image of our company and a consistent positioning of our products or services. We will build this image around our name “Rainbow Kites, Inc.” and will emphasize to retailers to wonderful color and excitement that a well-done display of top quality kites can add to their store.

While we will attend some trade shows and produce a color catalog, these marketing initiatives are seen as supporting, not competing with our independent sales representatives.

SALES TACTICS

Our primary sales method is face-to-face selling by independent reps A particularly important aspect of our sales process is that we will fly all of our independent reps to our West Coast office to extensively train them in how product line, in building displays, and in building a bigger kite business for our customers.

We will insist that our independent reps represent only non-competing, non-kite lines. We will stay in close phone contact with our reps in addition to having sales meetings with them at least four times per year, usually at major trade shows.

We will pay our reps on a “ledger” basis, giving them commission on all sales in their exclusive territories even if the account phoned the order in directly to our main office.

ADVERTISING

We will have a small advertising budget, devoted exclusively to trade publications designed to reach buyers and owners of upscale independent stores. The objective of our trade advertising will be limited to reinforcing the image of our company and the excitement of stocking upscale kites. All ads will be four-color and between 1/4 and 1/8 page in size. Each ad will prominently feature our logo and a bright, colorful, changing display of upscale kites.

We will also work with our retailers to obtain co-op advertising funds for their own local advertising. Currently very little co-op money is being provided by kite manufacturers, but we believe that we can make more funds available especially if we work with a US ad agency to develop effective advertising layouts and copy that our retailers could use.

PUBLICITY

Our publicity effort will be three fold. For one we will send news releases to trade magazines to try to get product or company feature coverage in front of the eyes of retailers. Second we will product a few generic press releases about kites that our retailers can use to try to obtain publicity coverage for their stores in local publications. Third we shall have a quarterly newsletter for retailers that we are currently serving or hope to be serving. We anticipate sending 1,000 copies of the news release out our first year and gradually increasing to 2,000 copies by our third year. In the newsletter we will highlight not just our products, but also display ideas and success stories of stores who increased their kite sales.

TRADE SHOWS, ET. AL.

We will have a small booth or table top display at four national conventions each year, including the National Toy Show in February in New York, The Toy and Hobby Show in April in Toronto, The International Gift Show in Las Vegas and the West Coast Toy and Gift Fair in May. We will emphasize not just our products but the custom-built displays that we are producing for retailers.

We will also provide limited funds for display space for our independent reps at regional trade shows that they attend. Typically we will pay for one table top display.

OPERATIONS

KEY PERSONNEL

The Company will be managed by the two founding partners, whose individual areas of expertise cover many of the functional aspects of the business. Tom Anderson will serve as the President of the Company, and will be responsible for Product Selection and Sales & Marketing. Nancy Anderson will be the Vice President, in charge of Administration. She will be responsible for customer service, accounting, shipping and the general administration of the business.

Tom Anderson has a long history of experience in the Toy Business and specifically in Kites. For several years he grew the Kite business at Ocean Gifts and Toys in Los Angeles into one of the largest and most profitable exciting in the country. Tom has a many industry contacts and an in-depth knowledge of the kite and toy business. See Tom’s resume for further details.

Nancy Anderson directed a staff of twelve as the manager of customer service for LA Selections, a major local jobber of novelty goods. She has also held a wide variety of other inside business and operations positions. See Nancy’s resume for further details.

ORGANIZATIONAL STRUCTURE

The organizational structure is very simple. The independent commissioned reps will report to Tom Anderson. And support staff at the office and warehouse will report to Nancy. Because Tom will frequently go on buying trips to the Far East or be on the road selling, Nancy will be able to support any day-to-day needs that the reps may have. However, even when Tom is on the road he will be in constant touch by computer or phone.

PRODUCT/SERVICE DELIVERY

In order to deliver high quality, personalized service we will carefully select all employees–especially sales reps and customer service representatives who deal directly with customers. Tom is currently interviewing candidates for sales reps; we will carefully review references not from past employers or manufacturers but from retailers whom these sales reps have served. We will also make sure that each employee understands our way of delivering quality service to each customer. We will have immediate back-up support available by phone from our office for more difficult service issues. And we will give employees enough latitude so that they can respond immediately to almost all customer requests or complaints, which in this industry usually mean granting prompt credit for damaged merchandise.

CUSTOMER SERVICE/SUPPORT

We intend to prioritize customer service and make it a key component of our marketing programs. We believe that providing our customers with what they want, when and how they want it, is the key to repeat business and to word-of-mouth advertising. Not only will we train our employees to deliver excellent service, we will give them the flexibility to respond creatively to client requests. In addition, we will continually monitor our clients’ level of satisfaction with our service through surveys and other convenient feedback opportunities.

Initially we expect to have few enough accounts so that Nancy and one additional employee can handle all customer service issues. Having just one employee to train should help insure that Nancy can help make the new hire a top performer. As our business grows we intend to hire additional customer service people one at a time and pay a premium over market labor rates to attract and retain quality help.

Shipping problems are a huge issue with the firms that we compete with largely because they insist on using surface shipping methods to keep their costs down to charge low prices to keep their mass merchant accounts happy.

We intend to use air freight to import our kites from the Far East. This will add to our costs slightly. But because all of our products are more expensive it makes more sense for us. It will also allow us to have much thinner inventories in our warehouse without risking stocking out.

Our relatively high cost of shipping has put us at a competitive disadvantage. The current cost of shipping for an average order is $…, which we feel can be reduced by …%. We intend to achieve this cost reduction by putting our overall shipping requirements out to bid.

FACILITIES

We plan to lease approximately 10,000 square feet of space as soon as our financing is finalized. We have a specific property in mind and have a tentative agreement with the landlord’s agent. This building located near LAX airport has 8,500 feet of warehouse space and a small 850 square foot office. The lease rate is $6.35 per foot triple net for a 2 year lease with the option for two additional years at an increase of 5.9% per year.

The building is located in a busy industrial neighborhood, but because we do not intend to have customers visit us we have decided we are better off with a lower-rent location, than a location that could double as a fancy showroom.

Wow !!! At last, we have concluded this article, I hope the issue of how to write a business plan has been trashed out.

This sample business plan format was originally located at www.businesstown.com/planning/creating-rainbow.asp

A Template on How to Conduct Feasibility Study on a Business idea

Do you know how to conduct feasibility study on a business idea? What if I provide you with a feasibility study template and sample? If I show you a practical feasibility study outline, will you appreciate it? If your answer is yes, then read on.

In the previous article wrote, I stressed the importance of conducting feasibility study on your business idea before taking it to the marketplace. Today, I will be teaching you how to conduct feasibility study on your business idea. Since conducting feasibility study is such an important process that must be carried out on your business idea or proposal, I will advise you print out or bookmark this article for future reference.

“A man that is prepared has half won the battle.” – Sydney M. Bremer

                How to Conduct Feasibility Study on a Business idea or Opportunity

A Typical Feasibility Study Template and Outline

1.            Economic Analysis

I believe this is where your feasibility study should start from. What is the essence of carrying out market research or even going ahead to start a business when the economy does not favor entrepreneurship or private ventures? Analyzing the economy will help you align your planned business with the economic situation on ground. Economic feasibility should include analysis on government’s fiscal and monetary policies, import and export rate, inflation rate, tax rate, and currency exchange rate and so on.

2.            Market Analysis

The next thing you should be analyzing is the market for your proposed business idea. Carrying out a feasibility study on the market will enable you know if there is actually a need or market for your business idea. Market analysis will also help you to determine the size of the market, demographics and psychographics of the market, level of competition and the size of the market you can compete for.

3.            Technical Analysis

This part of a feasibility study deals with the technological requirements of the business. Technical analysis will enable you determine the method of production to be employed, equipments, spare parts and tools, site development, supporting facilities, the nature of the factory building, fencing and so on.

                How to Conduct Feasibility Study on a Business idea or Opportunity

A Typical Feasibility Study Template and Outline

4.            Location Analysis

 This is carried out with a view to determine the best location for the business in terms of nearness to high traffic roads, nearness to infrastructure, accessibility to customers, ease of transportation of raw materials and finished products, nearness to cheap labour, cost of land acquisition and so on.

5.            Manpower Analysis

This part of a feasibility study deals with the process of estimating the level of skill, professionalism and number of employees to be hired by the business. The salary scale, incentives and pay package are also estimated at this point.

6.            Financial Analysis

Financial analysis will be dealing with the estimation of the total capital involved, capital expenditures, working capital; profit and loss analysis, pricing of products, cash flow projections, projected sales revenue and the entire project viability. Everything concerning finance should be dealt with at this juncture. If you are trying to raise venture capital for your small business startup, then you have to do a clean job on the financial section of the feasibility report because this is where investors focus on. All they are interested in knowing is how much is the percentage return on investment and the payback period.

7.            Sensitivity and Risk Analysis

This is the last part of a feasibility study and probably the most important. After all other factors have been analyzed and proven viable, sensitivity and risk analysis can come in. Building a business without properly conducting a risk analysis is like flying a plane without regards to weather condition.

Before any business idea is taken to the marketplace, its risk to reward ratio should be analyzed, the sensitivity to competition should be determined and the liquidation rate of companies in the industry of your proposed business venture should be calculated. With results obtained from sensitivity and risk analysis, growth and survival strategies can be developed for your proposed business.

As a final note, if conducting feasibility study is too technical for you; then consider hiring a professional or a business consultant to do the dirty work for you. It’s going to save you time and energy. And just before I drop my pen, always bear in mind that carrying out feasibility study on your business idea will enable you write a business plan and help you forge a competitive advantage for your business and increase your chance of success.

Catering Business Plan

Is a catering business plan template important for a catering entrepreneur? Do you need to learn how to write a catering business plan? Do you need a sample catering business plan template?

Well, if you have a catering business or you are planning to start one, then you should be aware that there is more to running a catering business than simply preparing foods. One of the keys to success in a catering business is to operate strategically with a business plan. I have written exclusively on how to start a catering business from home, so this is a follow up to that article.

Well, there are many reasons why you have to prepare a plan before you start a catering business. If you wish to secure funding presently or later in the future, then you definitely need a catering business plan template. Business planning is important regardless of the business field you are in.

Another reason why you need to know how to write a catering business plan is to keep your objectives clear and make your perspective tangible. Most importantly, knowing how to draw an operating plan for your business will give you the needed flexibility to adjust your plan accordingly in the future.

So are you still interested in learning how to write a catering business plan? Then here’s our catering business plan template, samples and a few helpful guidelines.

   A Sample Catering Business Plan Template

  • Describe Your Company

Describe the functions of your company and indicate if it is a sole proprietorship business or an incorporated business. You need to state too in your business plan what catering services you are offering to people. Try as much as possible and be specific. You may clearly state that you are preparing and delivering foods for wedding celebrations or in all kinds of events.

  • Research Information about Your Business

Try to find information about your competitors. You need to know how many businesses are offering catering services in your area or how many are catering exclusively for weddings. You must assess the needs of your business environment and how you can help people address those needs. It is important that you know what people want or what is in demand in the industry you are in. You should also analyze your personal and business strengths, weaknesses, oppositions and threats; then list all of it in your business plan.

  • State How You Want to Use Your Funds or Earnings

Carefully think just how much capital you need, how you intend to raise funds and how you will use your funds or earnings. Will you buy new equipments that you think are necessary for your business? How much you are willing to invest to improve your catering services? It is important to organize the usage of funds. List down all the things you may need to render a good service. By stating how you want to use the funds you have, you can have your business plan implemented smoothly.

  • List Down All the People Involved in Your Business

List down all your catering business staffs with their full names as well as experience assessed in years. Ensure that your staffs have sufficient catering experience.

  • State How You Are Planning to Cope with Possible Challenges and Issues

Summarize in your catering business plan by explaining how you intend to cope with the challenges and problems that could possibly arise during your operation. Make sure to list some examples or scenarios and what you can do about it. These issues will include customer complaints, marketing, advertising and promotion, etc.

   A Sample Catering Business Plan Template

In conclusion, learning how to write a catering business plan is not quite difficult if you have a good format template; but you should not be taken your plan for granted.

Running a catering business can be rewarding and challenging as well; because and you will be involved with almost all aspects of your business. You need to monitor the overall operations of your business, be part of cooking operations or even part of service distribution. It is crucial that you know how to handle your business and its customers. If you don’t, then who will then handle it for you?

How to Start a New Business: It Takes More than Just an Idea

I have got a brilliant idea that going to make me a lot of money! That’s the pitch I usually get from budding enthusiastic entrepreneurs. My questions now are:

                     “Is a brilliant idea all it takes to start a business? Does a smart business idea guarantee success when starting a business from scratch? Is a business idea the minimum, most important requisite for starting a business? Will a million dollar idea; see you through the entrepreneurial process of starting a business from scratch.” Well, you will find out further down this article.

Sometime ago, I went into a fast food outlet to honor an appointment and I met some youths in the lobby. From my observation, they were waiting to be interviewed for a job at the fast food. Just immediately, an idea cropped in my mind and I joined these young lads waiting to be employed. While in the waiting line, I started a conversation with a young man who should be in his mid 20s.

The young man, who turned out to be a graduate told me he had a passion for cooking. He told me he had a plan to set up a restaurant and based on the detailed plan he gave me; I knew this guy has something innovative up his sleeves and I loved it. He even had a name for his dream restaurant. I asked him what’s holding back the dream of starting a business from being made real and he said he has been trying to raise capital from his wealthy relations.

                “There are fast ideas and slow ideas, just as there are fast trains and slow trains. When it comes to money, most people are on the slow train looking out the window watching the fast train pass them by. If you want to become rich quickly, your plan must include fast ideas.” – Robert Kiyosaki

In as much as I loved the young man’s idea; I nodded my head, shook his hand and bid him good luck. On my way to honor the appointment, I kept thinking about this young man. He was cool, smart, enthusiastic and had a brilliant idea backed by a university degree. I really loved the guy and his idea but it’s a pity; the world is filled with brilliant business ideas and I just wish I had told him that. But how would he take it? I am not writing this to discourage budding entrepreneurs from coming up with creative ideas. In fact, I am writing this to encourage you to think and come up with good business ideas. But most importantly, I want you to think beyond the idea because a business idea is just the starting point to starting a business.

                “Dream more than others. Think practical.” – Howard Schultz

The world is filled with budding entrepreneurs carrying business plans and seeking investment capital. The sad news is that 85% of these entrepreneurs are never going to go beyond the initial planning stage and that’s the hard truth.

            Now what does it takes to start a new business?

That may be the question on your mind. While I believe there is no conventional answer to this question; I will try to provide street smart answer but before I do, I suggest you ponder on the following questions:

Did the successful entrepreneurs and richest school dropout billionaires become ultimately rich because of their ideas? Did Rachael Ray start a restaurant business before harnessing her cooking potential? Did Debbi Field’s wait to raise millions of dollars in capital before starting her cookie business? Of the entire social networking platforms available; why did Facebook emerge the most popular thus, making its founder Mark Zuckerberg, the youngest billionaire in the world?

                “A business idea is just another idea. But an idea backed by a strong feasibility, a thorough business plan and a smart team is no longer an idea. It’s now a solid business opportunity worth pursuing.” – Ajaero Tony Martins

In answer to the illustrations and questions asked above, I want you to know that Rachael Ray didn’t start a restaurant business before she began making millions from her cooking recipe. She simply took her business idea, struck a deal with a local television network and became a self made millionaire. No restaurant, no external funding and no million dollar infrastructure. All she had was just her cooking recipe and a television network joint venture; that was all.

Debbi Field’s did not wait for some investors or Venture Capitalists to invest in her passion for baking cookies. She simply looked for a good business location, baked some cookies with her own money and walked around her vicinity giving away free cookies.

Facebook was not the only social networking platform available online; in fact, MySpace has already been in business long before Facebook came on board. Was it Mark Zuckerberg’s idea that led to Facebook’s success? I don’t think so.

These three selected entrepreneurs all possessed average business ideas but they had something which other entrepreneurs lack. In this article, I am going to reveal to you five things you need to start a business and become successful other just than an idea. This write up will help reduce your over concentration on the business idea and shift it to developing the most necessary requirements to starting a business. Building a business around an idea requires everything you’ve got. You are the ultimate key to the realization and utilization of that business idea. To start a business and build the business of your dreams, you need a little of the following:

                Five Things You Need to Start a New Business from Scratch

1.                   You need guts to start a business

                “The critical ingredient is getting off your butt and doing something. It’s as simple as that. A lot of people have ideas, but there are few who decide to do something about them now. Not tomorrow. Not next week, but today. The true entrepreneur is a doer, not a dreamer.” – Nolan Bushnell

Launching a business out of the planning board require guts; quitting your job to start your own business require guts, believing in your business idea even when everyone says you are nuts requires guts and facing business challenges also require guts. That’s why I listed guts as number one. Guts, chutzpa, boldness, brevity, courage; they all mean the same thing. Without entrepreneurial guts, just forget about starting a business.

                “You are nuts and you should be proud of it. Stick with what you believe in.” – Trip Hawkins

2.            You need business skills to start a business

The next thing you need to make your business idea a reality is skills. What are you bringing to the table? This is the question you must answer when seeking joint ventures and business partnerships. Your possessed entrepreneurial skills are very important to the realization of your ideas because your skills can be a strength or competitive advantage for your business. Skills are a necessity when searching for a business team.

                “The ability to sell is the number one skill in business. If you cannot sell, don’t bother thinking about becoming a business owner.” – Rich Dad

Have you heard the phrase that “entrepreneurs are generalists.” I think there is an atom of truth in that statement. Entrepreneurs are generalist, they need to know a little of everything that pertains to business. That’s where your business skills come in. As an entrepreneur, you need to know a little of accounting, investing, sales, marketing, operations and business management in general.

Before ever starting a business; be sure to hone your sales skills, marketing skills, communication skills, negotiation skills, accounting skills, leadership skills, people skills and every other entrepreneurial skills that’s required to succeed in business.

                “Skills make you rich, not theories.” – Rich Dad

3.            You need the right mindset to start a business

You probably must have heard this over and over again but I think it’s worth repeating. You can’t build a business if you lack the right mindset. Entrepreneurship is not really about starting or building a business.

                “Starting a business is like building a ship and embarking on a voyage, armed with a plan, a map and a team. You will have to sail against storms, unpredictable weather and uncertainty. If your ship sinks, it’s either you quit or you swim back to shore, build a new ship and sail again.”  – Ajaero Tony Martins

Entrepreneurship is simply a change in perception or core value. It’s the process of developing your mindset from being job dependent to being financially independent. It’s a shift from being handicapped in the face of challenges to being a problem solver. In all, entrepreneurship is simply a change of mindset.

4.            You need capital to start a business

I believe you know that no business idea is worth a pinch of salt without capital. I don’t want to stress much on this because I believe you know the significance of capital to any business. But in retrospect, I always advice my protégés not to be deterred by lack of capital. I encourage them to get creative when it comes to financing their small business startups; where there is a will, there will surely be a way.

                “There are three components to starting a business. One is the right plan; two is the right team and three is the money. Rarely do these three components come together when starting a business. It’s the duty of an entrepreneur to grab one piece and start the business, the remaining two pieces will be found along the way. Finding the remaining two components may take a year or more than 10 years; the point is, start with what you have.” – Robert Kiyosaki

5.            You need the right business management team

                “Individuals don’t win in business, teams do.” – Sam Walton

Finally, you need the right business management team in place to build a business around your idea. For your business idea to leave the planning phase, it’s going to require the right business team. If you can assemble the right team to deliver on your plans, I bet you will find the venture capital because a strong business team is an essential ingredient to the process of raising capital from Venture capitalists.

Now how do you find the right team? I don’t know. How do you know you’ve found the right business team? Once again, I don’t know but what I do know is that the right team is a team that complements your weakness and adds value to your business. A good way to know you have the right team in place is that your business will take off like wild fire and gain grounds seamlessly with little or no effort on your part.

As a final note, these are the five things I believe are fundamental to either starting a business from scratch or building a successful business. So don’t get too excited because you feel you’ve got a creative idea up your sleeves; instead, start strategizing on ways to assemble the five elements listed above for your business. Remember, the world is filled with brilliant million dollar ideas waiting to be funded but the world lacks seasoned entrepreneurs. Take this lesson to heart and I will see you at the top.