Tips & Talk 66 – The Wrong Way to Start a Business
It’s easy to start a business. What’s hard is to stay in business! There are a variety of reasons why businesses fail at such a high rate. And of course, nobody takes actions intentionally that will set them back. But that’s exactly what’s happening to most business startups. In the end, their initial actions never gave them a fair chance of survival right from the start.
When you first learn about a new business in town, you hear the name, perhaps see their logo, take a look at the products they offer, things like that – right? These are the first things intuitively you would put in place for your new business because they are the things you know and see about a business from an outsider perspective.
Yet there is a critical step that should be taken before doing any of these things. It’s missed because people just don’t know. And it’s this most-important first step that, when not taken, leads to many many handmade product businesses closing down.
Let’s get into the details of what to do first so your business is set up for success.
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Transcript
Hi there.
Speaker:It's Sue.
Speaker:And thanks for joining me for tips and talk day.
Speaker:These are bite-sized topics that I pull from community questions and
Speaker:things that I'm observing in the world of handmade small business.
Speaker:If you'd like to submit a topic,
Speaker:DME over on Instagram at gift biz unwrapped,
Speaker:before we get into the show today,
Speaker:I want to make sure that you know about the newest
Speaker:thing happening over here.
Speaker:It's called the gift biz bash a zoom party that turns
Speaker:into a podcast episode.
Speaker:Several weeks later,
Speaker:the party consists of a short training with Q and a,
Speaker:from yours truly.
Speaker:And then an opportunity for you to give a shout out
Speaker:about your business.
Speaker:You can tell us about a promotion you currently have going
Speaker:on or share a collaboration that you're considering so that you
Speaker:can find a perfect partner for the event.
Speaker:A little bit of learning and visibility for your business.
Speaker:What could be better?
Speaker:There is a catch though spots are limited to keep the
Speaker:party to about 45 minutes or so.
Speaker:That means you should grab your spot right away.
Speaker:It's totally free to make sure you're included.
Speaker:Why not do that right now?
Speaker:Pause this episode,
Speaker:go to gift biz,
Speaker:unwrapped.com forward slash bash to sign up and then come back
Speaker:and listen to the show.
Speaker:I'll see you at the bash.
Speaker:It's easy to start a business.
Speaker:What's hard is to stay in business.
Speaker:There are a variety of reasons why businesses fail at such
Speaker:a high rate.
Speaker:And of course,
Speaker:nobody takes actions intentionally that will set them back.
Speaker:But that's exactly what's happening to most business startups in the
Speaker:end, their initial actions never gave them a fair chance of
Speaker:survival, right?
Speaker:From the start we're going to get into what these things
Speaker:are. As they relate specifically to handmade product businesses.
Speaker:Today, let me say right here,
Speaker:though, that this is going to be an uplifting and enlightening
Speaker:message. I promise.
Speaker:And if you're thinking of starting your business right now,
Speaker:this will give you direction on the first actions to take
Speaker:and hopefully catch you in time.
Speaker:Before you go too deep into doing what I say are
Speaker:the wrong things.
Speaker:And if you're listening today and already are doing some of
Speaker:the things I'm going to describe,
Speaker:it's okay.
Speaker:It's never too late to self-correct.
Speaker:Okay. Let's go back to the beginning.
Speaker:When someone has the idea of starting a business,
Speaker:what's the first course of action.
Speaker:They do things to establish a business based on what they've
Speaker:observed as a consumer,
Speaker:the forward facing things that make up a business.
Speaker:It's intuitively natural.
Speaker:For example,
Speaker:as a first step to decide what you're going to name
Speaker:the business,
Speaker:then they usually build an inventory of product and begin trying
Speaker:to sell.
Speaker:And there is no reason to think about a different approach,
Speaker:except that you're now listening to what I have to say
Speaker:about this.
Speaker:These are the first actions taken because these other things,
Speaker:you know,
Speaker:and see about a business from an outsider perspective.
Speaker:When you first learn about a business,
Speaker:you hear their name,
Speaker:perhaps you see their logo,
Speaker:take a look at the products that they offer,
Speaker:things like that,
Speaker:right? Yet there is a critical step that should be taken
Speaker:before doing any of these things before you start your own
Speaker:business, it's missed because people just don't know.
Speaker:And it's this most important first step that when not taken
Speaker:leads to many,
Speaker:many handmade product businesses,
Speaker:closing down as a business coach,
Speaker:I'm highly tuned into this startup problem.
Speaker:I can see from afar,
Speaker:the crushing of a dream and the switch from excited anticipation
Speaker:of what will be with a new business to admission of
Speaker:defeat. When this initial step isn't taken,
Speaker:it's heartbreaking but preventable.
Speaker:The missing step that most people never take is to validate
Speaker:that there's a market for their product.
Speaker:Meaning you have identified and proven that a group of people
Speaker:are willing and eager to pay money in exchange for getting
Speaker:what you make.
Speaker:When you're able to prove through experience,
Speaker:that people will buy your creations,
Speaker:that when it's time to start your business,
Speaker:for real,
Speaker:there are a variety of ways to do this validation,
Speaker:but essentially what you're doing is getting your products in front
Speaker:of would be customers and observing their reactions.
Speaker:What products do they ask questions about,
Speaker:pick up sample or buy?
Speaker:What colors sense sizes are their favorites?
Speaker:Is there something missing in your lineup that has asked for
Speaker:over and over again?
Speaker:There are so many things that you can learn about your
Speaker:products and their receptivity through observation and conversation.
Speaker:Also, if you're trying to decide between two different products as
Speaker:the base for your business,
Speaker:which one is getting the most attention,
Speaker:that will be your answer.
Speaker:And no,
Speaker:you don't want to be starting a company around all the
Speaker:things that you can make,
Speaker:like painted signs,
Speaker:essential oils,
Speaker:and knitted beanies.
Speaker:You want to be known for just one.
Speaker:And if you need any better example about this statement,
Speaker:refer to shark tank.
Speaker:What do people do?
Speaker:Who pitch on that show?
Speaker:One, just one product,
Speaker:a deeper conversation about this could be for another tips and
Speaker:talk episode,
Speaker:bottom line,
Speaker:before you do anything else,
Speaker:even naming your business,
Speaker:validate your product first,
Speaker:make sure you have an audience of people who will buy
Speaker:your products before you spend time and money going any further.
Speaker:And if you'd like some help with product validation,
Speaker:go to the start with confidence program that you can find
Speaker:on the gift biz,
Speaker:unwrapped website or@giftbizonrapt.com
Speaker:forward slash start with confidence.
Speaker:This gives you step-by-step direction,
Speaker:including ways to conduct validation tests and what to do.
Speaker:If nobody's buying,
Speaker:it's not the end,
Speaker:if that happens.
Speaker:And aren't you glad you found out early on,
Speaker:there are ways to work off that information and get to
Speaker:a product that will sell it's.
Speaker:At that point,
Speaker:you truly get moving with your business.
Speaker:That's a wrap.
Speaker:I'm a get to the point kind of girl.
Speaker:And this is what you can expect from these quick midweek
Speaker:sessions. Now it's your turn go out and fulfill that dream
Speaker:of yours.
Speaker:Share your handmade products with us.
Speaker:We want them,