By Andrew Svisco , Owner of Parkhurst Brand LLC
They say if success was easy then everybody would be successful. It takes a series of many difficult steps to become successful at something. Most people don’t realize until they are in the thick of things how these steps affect their personal lives and their overall lifestyle. Coming up with a product, service or idea is the easy part – the most difficult parts are the below:
- How are you going to get to the market? Does the market you are looking for exist?
- How are you going to make your product or service and how are you going to deliver it to your customers?
- How are you going to grow and are you really prepared to make sacrifices?
Let’s go over a few things to consider when pursuing going into business:
Product – Arguably a couple of the biggest questions are does your product solve a problem and how is it different from its competitors? Did you design your product, or did you hire someone to design it? Did a team design it? The more involved you are in designing and making your product, the more effectively you will be able to advertise, speak about it and connect with people regarding your product. Your product is you – immerse yourself in it and make it your life. Quality cannot be sacrificed – you need to ensure QC by establishing a good relationship between you and your suppliers/manufacturers. If you need to change something small that will take a few months, then you need to do it while finding other ways to further your business in the meantime.
Getting to the market and delivery – This can involve a series of different tests such as using social media and pop-up shops to put your product in front of people. From here you can gauge their reaction and collect the most valuable thing whether positive or negative – feedback. Most people don’t start out with a warehouse full of product so what do you do when you are starting out on a budget? You need to get clever. Use your basement, your dorm room, your spare room etc. to hold your inventory then ship as needed. Don’t go out renting space – you need to test the product first for the initial year or so to see if you have something viable. Using cheaper shipping options such as the post office will greatly help your bottom line. Can your packaging be made cheaper? How do you plan to advertise? Social media for products tends to be the lowest cost for most exposure, but due to changing Facebook/Instagram algorithms, the cost to advertise on social media is increasing – not to mention the number of users keeps increasing, which in turn makes it even more expensive to reach your target audience.
Lifestyle adjustment – Pursuing an entrepreneurial dream will come at a cost. You may grow distant from family, lose friends and possibly lose a significant other over it. You need to be prepared for these possible outcomes and accept that they are part of this journey you are embarking on. Are you willing to skip breakfasts to save money? Eat rice cakes for lunch? Chicken noodle soup for dinner? (the condensed stuff – not that chunky fancy shit). You may need to get a cheaper car, get water instead of beer when going out, skip golf games. Ever use shampoo as a body wash? Everybody’s path is different. Once you begin to go down this road, you will know what you can sustain and what you will need to give up.
Cash flow and projections – This is vital to a business. Without any cash flow, your business is dead. What will fund the day to day operations? Say your money from sales doesn’t clear for a couple of business days but you need cash to ship out orders now – what do you do? You need to budget and project so you will know how to save and over what period of time because you will have expenses – always. Businesses can have expenses nearly every day, especially if you are an e-commerce business. What are your gross and net margins? Does your product require upfront material costs in order to produce finished goods? You can determine this by finding out how much of the materials your product use, multiply this by the cost per unit of material and add in as part of your COGS. The key here is to determine how much money it will take to pursue and sustain the pursuit of an idea without having you or the company go bankrupt.
Parkhurst Brand LLC