Are you a would-be entrepreneur? Then this may be of interest to you!
There are a couple of options here that are about “thinking outside of the box”: at a time like we have today, would you return to school or go into business for yourself?
There’s certainly some risk involved here, but because of the tight labor market, a lot of people are rethinking their futures.
Maybe you have an awesome idea that no one else has? If that’s the case, you might want to hear about this new business strategy dubbed the Blue Ocean Strategy.
The Blue Ocean Strategy is an approach designed to tackle a market where you have absolutely no competition, where you can become a pioneer in the industry.
Becoming a pioneer in a new market has its perks such as receiving tax deductions, the prestige of being the first to market in a new field, the opportunity to be offered business proposals/strategic alliances, and the satisfaction of growing your company from scratch and turning it into a successful enterprise.
Start A New Business Using The Blue Ocean Strategy
Here are some steps on how to evaluate a business idea and how to start a new business based on that idea:
1. Do some market research first. Let’s say for instance that you’d like to open a store. Market research may become a key factor in your business success as it would include vital statistics like foot traffic for your shop location, life expectancy of your business, and other information that would decide whether your proposal is good enough to work.
2. Write a business proposal that includes the financial break down of the operating expenses and start up costs of your venture. Make sure to be concise about everything, and have your ideas transcribed on Power Point and ready to be shown to potential investors. Show your proposal to your close friends and family first, and give them your pitch. Test out your ideas on the people you know so that you can get some valuable initial feedback.
3. Find investors. For funding purposes, the first people whom you should approach should be your family and friends. The people who will best support you emotionally and financially (as a budding entrepreneur) are the people in your personal circle and network. If you require funding between $50,000 to $500,000, then you’ll require an angel investor. If you need more funding than this, say $1 million onwards, then I’d suggest that you start looking for the right venture capital investor that covers your particular market. Venture capitalists can check out your proposal to see if your idea could be a potential hit in a new market. It never hurts to try for a loan, but these days, banks have become stingier regarding loan applications due to the financial crisis.
4. Employ the right people. Once you’ve acquired investments, then it’s time to think about securing the help of others who can assist you with running your business. Your success will lie in the people who work for you.
5. Plan your cash flow right. Always have enough funding for operating expenses that will last you at least 6 months. You’ll need this kind of liquidity for your business so that you’re able to successfully plan ahead and avoid surprises when making decisions and projections.
The points I’ve made above are just the basics. But you can get more information about this topic by checking out the book: Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant.