There is no business or new business direction that doesn’t face risks. The secret is to determine what they are, take time to understand them and then determine what direction to take. Taking this type of a forward look is an essential part of the business planning process. Risk examination should be looked at when a new business is started, when an existing business takes a different direction and when there is no contemplated change in a business.
Let’s take a look at a few sources of possible risks to your business:
- COMPETITION: competition can come from several sources:
- existing competitors already in your market place
- new competitors moving in from other areas
- new startup businesses
Don’t make the mistake of starting a new business or changing direction in your business without an extensive research into the three risks listed above. Just knowing in your heart that you can do a better job is not the answer. Take the time and do the research.
- NEW PRODUCTS/SERVICES: Your anticipated new business or direction may not be the latest solution to serve the needs of your target market. Again research is required.
- CHANGE ITSELF: in today’s fast paced environment change is the only constant in your business life. A business may have to be ready to re-invent itself and its products/services with little notice. In this area, marketing should be the main focus as it is a constantly changing dynamic of any business. (Look at what technology has done for marketing, i.e. computer, i-pads, smart phones, etc.)
I have not addressed the resource issue; time, money and staff. This area is part of the strategic business plan and is always considered an important part of any new venture.
The bottom line becomes the research aspect before starting a new venture or changing a business focus. Unfortunately, this is one of the hardest areas to convince a small business to undertake. The benefits you will gain are not only learning about potential risks, but it will also serve as an educational tool as you will learn what others are doing in your field.
It is planning not gambling that produces profit and security. Marcus Aurelius
Nick J Petra Certified Financial Planner specializing in business planning and coaching
Don’t gamble by traveling alone in your business walk; let us help you get your ducks in a row. www.strategicduck.com