Page 20 - (DK) The Business Book

18 INTRODUCTION

ll businesses start from the and that they have the skills and find a profitable niche—to succeed,
same point: an idea. It is knowledge to turn the original companies need to do something
A what happens to that idea concept into a successful business. different in order to stand out in
that determines business success. It follows that the idea must the market. The strategy for most
According to Entrepreneur be profitable. Sometimes, an idea companies is to differentiate; this
magazine, nearly half of all new may look great on paper, but turn means demonstrating to customers
start-ups fail within the first three out to be uncommercial when put that they offer something that is not
years. Beating the odds at start-up into practice. Determining whether available from competitors—a
is tough. First and foremost an idea, an idea has potential requires a Unique or Emotional Selling
no matter how good, must be study of the competition and the Proposition (USP or ESP).
combined with entrepreneurial relevant market. Who is competing Such attempts to stand out are
spirit, defined as the willingness for customers’ time and money? everywhere. Every business, and
to take risk. Without entrepreneurial Are these competitors selling at every stage of production, from
spirit a great idea might never be directly competitive products or raw-material extraction to after-
pursued. Not all ideas are good possible substitutes? How are sales service, tries to distinguish
ones though; it would be a foolish competitors perceived in the its products or services from all
entrepreneur who rushed a product market? How big is the market? others. Walk into any bookstore,
to market without careful thought, Most markets are increasingly for example, and you will see
research, and detailed planning. global, crowded, and competitive. countless examples of books, often
Risk might be inherent in business Few companies are lucky enough to on the same topic, using design,
enterprise, but successful style, and even size (large or small)
entrepreneurs are those who are to stand out from the competition.
not only willing to take risks, but Gaining an edge often depends
are also able to manage risk. on one of two things: being first
into a new market niche, or being
Realistic propositions The only thing worse different from the competition. For
Having an idea is the first step— than starting something example, in 1995 eBay was first
the next hurdle is finance. Some and failing … is not into the online auction market,
start-ups require very little capital, starting something. and has dominated it ever since.
and a few require none at all. Seth Godin Similarly, Volvo was first to identify
However, many require significant the opportunity for luxury bus sales
US entrepreneur (1960–)
backing, and most will need to seek in India, and has enjoyed healthy
funding at some stage in the sales. In contrast, Facebook was by
growth process. An entrepreneur no means the first social network,
must be able to convince financial but it is the most successful; its
backers that the concept is valid edge was having a better product.