"Someone has ever thought about it before, loser"
-Your brother in law
You have probably already heard this sentence that kills every time your ambition. To listen some people, being in business is only a matter of certainty. We cannot succes in an already existing market. An innovative idea is led to failure. All yours ideas are already done by someone smarter, richer and more powerful. Enough depressing stuff, isn't it?
But no, you are stronger than this. Read the biography of successfull entrepreneurs as Warren Buffet or Mark Cuban and you'll see that the resilience and ingenuity are the central elements of their success. In this second article in my top 5 of biggest illusions about entrepreneurship, I tell you the opportunities that come to you when you decide to get started in business in an already competitive market.
A question of strategy
When I started in business, I told myself that I was 20 years late. I thought the 21st century was a saturated market and that it was impossible to get the game under these conditions. That life should be easier in 1832 for entrepreneurs! Everything was to be done and the great modern breakthroughs were not yet. I have been paralyzed by this mentality for several years, but I finally realized that I was completely wrong.
I made the mistake of look backward rather than forward. When you read about the history of capitalism, you realize quickly that innovation is not the story of a specific period, but a constant revolution. Every minute the opportunity to revolutionize a market, take advantage of a systemic weakness or an invisible mass opportunity. Think big.
Good, enough stories; How do you now?
Not surprisingly, the first step to enter in a competitive market is a good strategic planning. If you read these lines, you understand definitely the importance to write its business plan and refine it up. This exercise will allow you to identify the strengths and weaknesses of your product or service and to reflect on the market you are trying to address.
To generalize, three types of markets can offer to you: a little competitive emerging market; a market very expanded with many competitors; a monopoly or a high concentration in the hand of few dominant companies. These are the last two scenarios that interest us and which deserve a more robust strategy. After all, if you revolutionize the market of bread sliced by an incredible invention, it will be easy to take advantage. We, deals with the wars of trenches.
Richard Branson, founder of the Virgin Group, describes in his biography "Losing my virginity" its general strategy in case. According to him, when a market does not provide enough to his customers, you can do better. Specifically, integrate these markets will be using a mindset oriented to the client rather than the company. Profit margins too high, a heavy bureaucratic structure or a poor quality customer service are all opportunities to review the methods and take advantage while better serving its customers.
If you have not billion of dollars...
You will probably not benefit from a business model that will lower the costs of production and marketing. Unless the inventor of a revolutionary production method, your supply will be based on the traditional method, where the big players have the advantage of buying in volume. As a result, lower profit margins will be very difficult since your costs will be very high. Unless conquer the market with a launch of enterprise with high capital, this kind of market you menottera for sure.
Combat the "acute systemite"
Some markets are dominated by big players stuck in heavy structures to the American, inefficient and worthy of the ' 60s. The image of our modern Governments, to huge companies eventually lose control of their own structure and get bogged down in bureaucracy.
The Tesla company and its founder Elon Musk, whom I admire deeply, derive moment same profits from this situation in overturning the luxury car market. Ended the era of dealers and gas-guzzling cars. Technology comes to serve as a lesson in humility for the tenors of Michigan (Ford, Chrysler and GM). Tesla Electric cars are now synonymous of luxury, elegance and performance. Not bad for a market that did not exist 10 years ago!
You can do the same thing by simplifying what is too complicated. I recently shopped a sign for my restaurant. I did produce estimates by several reputed companies coming to me fairly high prices. However, a representative of a very small, local company came to see me. I liked his argument from the start: they are small, effective and have no unnecessary structures. I chose their product, which cost 25% less expensive than the competition for a better quality of manufacture.
In sum, the lean management mentality is probably the way of the future. A lightweight, flexible and malleable structure that reacts in real time to the conditions of the market offers only advantages. This aspect seems logical, but take the time to analyze all companies you meet in a day. You will be surprised the amount of opportunities to lighten these operations and the business opportunities arising therefrom.
A human and profitable approach
Consumption in 2014 is oriented around the customer experience. Ironically, so that capitalism has never been so strong and impersonal, the trend is emerging towards a need for uniqueness in the experience of daily consumption. Of course, this is not true for all markets. Wal-Mart proves day after day as a multinational impersonal and offering a nightmare customer service can make gazillons in profit.
On the other hand, savvy entrepreneurs will understand that the business of these companies model is not ideal. Unless you want to embark on sale at retail, where everything is a question of price for the customer, the opportunities are endless.
For example, I now uses the services of a duo of financial advisors who have an approach that I had never seen before. Rather than sell products and returns on capital, they took the time to sit down and I know as an entrepreneur. Knowing what I wanted for my future, they have created around me a structure of investment in line with my goals. I do unfortunately not yet worth hundreds of millions of dollars, but they invest in some way their time in my future. I very much appreciate to be able to express my wildest ambitions to competent people who allow me to free myself from these details for to invest me fully in my projects. They use the same products as all advisors to the world, but use of humane and different way.
Yet once, analyze your customer experience in the next few days. You will certainly find a host of places where you are treated to a bit like cattle. We are all used to this kind of system and there are few that it will really challenge. However, such a server that will make more tip for exceptional service, your business model may bring a lot of value by a personalized approach.
Moral of conclusion
Since the structure of a normal text includes a conclusion, I remind you that you are able to change the world and that you are unique.
Next week: Illusion #3: without experience, it is impossible to have success in business
