Running a small business can be a difficult task. Even some of the biggest and the most profitable businesses around the world have faced hardship in their early years of foundation. Here are five inspiring stories of businesses which had to overcome hurdles before establishing themselves as global brands:
James Dyson was disappointed with the performance of a vacuum cleaner he was using in 1978 and he decided to design a better and more efficient model. However, before creating the world’s first bag-less vacuum cleaner, the budding inventor spent 5 years creating over 5,000 prototype versions – all of which failed. Dyson is now a global brand, with offices in England and Asia, with an expanding research and development team. The company also manufactures heaters, fans and hand dryers.
In 1998, founders Richard Reed, Adam Balon and Jon Wright began selling their smoothies for £2 a bottle at a music festival in England. They spent £500 on ingredients for their smoothies, and the recipes they used were tested by close friends and family. They put up a sign at the stall, which read ‘Should we give up our jobs to make these smoothies?’, and customers were asked to put their empty bottle in bins marked as ‘Yes’ or ‘No’. By the end of the festival, the ‘Yes’ bin had more empty bottles than the “No” bin. The founders resigned from their jobs the next day to start their business. Innocent Drinks is now the biggest selling smoothie brand in the whole of Europe.
You will probably be familiar with Ford Motors, a multi-national automobile manufacturer founded by Henry Ford. Though, you might not be so familiar with the Detroit Automobile Company. This was the first company Ford started, but it went bankrupt in 1901. After a year, Ford began a new business – the Henry Ford Company – with a partner. However, after a conflict with his business partner, the company shut down. Undeterred, Ford started his third business in 1903, which he named the Ford Motor Company. This was also close to becoming another failure, but after receiving funding from an investor, the business was saved. The Ford Motor Company has now gone on to become the motor vehicle giant we know today.
4. Forever 21
The first branch of Forever 21, a global fashion retailer, opened in Los Angeles in 1984 by husband and wife Do Won Chang and Jin Sook. Before they opened the first store, Chang, an immigrant from South Korea, worked three jobs as a janitor, a petrol station assistant, and in a café. Originally called Fashion 21, the shop generated sales of $700,000 after just one year of trading. The success of Fashion 21 led Chang to open a new branch in California every six months, gradually building the brand – which was renamed Forever 21. It remains a family-run business, with Chang and Sook’s daughters also working for the company.
Rovio is the developer behind the hugely successful Angry Birds game franchise, and was founded in 2003 by cousins Niklas and Mikael Hed. Rovio had created 51 different games prior to Angry Birds, some of which they sold to larger game developers such as EA Games. Rovio was close to bankruptcy in 2009, after Niklas and Mikael decided to create their own games. This was also a complicated process, with over 100 different ideas considered before settling on Angry Birds. Before Angry Birds was released in December 2009, it spent eight months in the development process, undergoing numerous changes and revisions. It failed to make a significant impact on a global scale in the first three months, but after being featured on the UK App Store, sales rocketed. As of 2014, Angry Birds has had over 2 billion downloads.
Article compiled by Pocket Social:
Pocket Social lets businesses manage company social media accounts from a smartphone, tablet or desktop. The app prioritises tasks such as discovering relevant content to read and share, finding customers to approach on social media and identifying key influencers to approach.
Business plans are the most important starting points for any new venture or start-up. This document acts as a formal statement that defines your business goals and the plan to reach those goals. Ideally, it should also contain background information about the team that is attempting to reach those goals. A well written business plan also acts as a document that can persuade others, including banks, to invest in what you’re creating and trying to achieve.
Though there are many different types of business and ventures coming up these days, but the basic categories of information and questions that need to be covered by a business plan are fairly standard.
Here are the 5 key elements of an ideal business plan:
1. Executive Summary: This is one of the most important and critical elements of a business plan and is generally presented in the beginning of the document. An ideal executive summary should not be more than two pages in length and should provide an overview of your business concept, key objectives of your business, management team, your product or service offering, target market(s), competitive advantages, marketing strategy, and a brief summary of your financial projections.
2. Product and service: This is the next most important section of you business plan document. This is the section where you define, in detail, your unique product of service. It is always better emphasize on the benefits (not the features) of your product of service. Make sure to establish your unique selling proposition. This means you have to show not only how your product or service is different but also why it is better.
3. Market Analysis: In this section you should illustrate your knowledge about the particular industry your business is in. A through market analysis forces an entrepreneur to become familiar with all aspects of the market so that the target market can be defined and the company offering can be positioned strategically. Always keep in mind to defining the market in terms of size, structure, growth prospects, trends and sales potential.
4. Operations and Management: This is the section where you define the people behind your business i.e. who would be running the operations engine. This sections should give a detailed description of your team players and highlight their qualifications. This sections should also highlight the logistics of the organization such as the various responsibilities of the management team, the tasks assigned to each division within the company and how they plan to work together.
5. Financial Plan: Last but not the least, a well researched financial plan is the key to any business success. This is a section which needs the maximum amount of research and data. Typically, one has to show three to five years’ worth of projected financial statements, including income statements, pro-forma balance sheets, and monthly cash flow and annual cash flow statements. Another important element to include in this section is assumptions you used in forecasting your revenues and expenses data.
Well, apart from the above there are other sections that you could add to elaborate and give your plan a more detailed dimension. You could include things like competitive advantage, design and development plan etc. The ultimate objective should be to present your plan in the most detailed and descriptive format. Another thing to remember is that any good business plan is never meant to be written once. A knowledgeable entrepreneur understands that an business plan evolves as their business evolves and as their environment changes so its always better to re-visit your plan on a quarterly or monthly bases.
Every entrepreneur has unique ideas and is constantly finding different ways to make people believe in those ideas. Every unique business idea comes with BIG risks: risks associated with finance, manpower, technical know-how, industry experience and government regulations.
Small Business setup involves careful planning and financing a small business is by far the most challenging obstacles an entrepreneur has to overcome when starting a new venture. Most start-ups require at least a small amount of seed money to get started, and typically not everyone has that kind of money to invest. Unfortunately, there are few that actually reach the stage of successfully convincing investors to fund their idea.
Here are five possible ways to raise money for your small business:
Crowdfunding: This has become one of the most popular ways to raise money for a small business. In simple terms crowd funding is collection of finance to initiate a business idea from a large pool of backers—the “crowd”—usually made online by means of a web platform. Crowdfunding on websites like Kickstarter, Indiegogo and others that are geared more toward small businesses can give a big boost to the financing aspirations and also help in develop their brand. A well prepared business plan is a critical prerequisite for crowdfunding.
Angle Investors: An angle investor or angles are basically affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity. The main advantage of an angel investor is that you have a friendlier atmosphere and a quicker decision-making circumstance for a smaller amount of dollars. Such angels are usually attracted to innovative and technology driven ideas. Angel investing generally takes place at a very early stage of the start-up, thereby acting as an “angle” to the small business aspirant.
Home equity loan: Home equity means your current home’s value minus what you owe to the bank. Such home equity loans are a great option for financing a small business. These loans generally offer interest rates that are both flexible and lower than traditional commercial rates; however every country has different rules for such loans.
Venture capitalists: This option is more suitable for entrepreneurs that are beyond the start-up phase and already have revenues coming in. The most important benefit of venture-capital investors to a start-up is that they can help them get extra money and provide them with professional management expertise. Venture Capitalists or VCs generally look for quick ROI (return on investment) i.e. they often look to recover their investment within a three- to five-year time window.
Friends & Family: Well, if all fails then the best option is to speak to a trustworthy family member or a friend. Someone you think could believe in your idea and help you get started with at least the seed money. Borrowing from friends and family presents some unique advantages, including low- or no-interest payments and avoiding the hassles of bank contracts. The best way to approach this option is to have a well-thought-out game plan, not to mention, you should always give the real picture and tell them about potentials risks if the business fails. This will help you build the trust and also pose you as a through professional.
Are you a stay-at-home kind of a person? Are you a single mother or a stay at home dad? Have you always wanted to start your own home based business and be an entrepreneur? Or are you just looking to make some extra bucks by doing something on the side? Well, there is good news! According to a recent research, 52% of companies in the US operate as home businesses. So if you were to start your own business and that too from home, what could it be?
Well, here are some business ideas for stay–at-home people:
- Virtual Assistant
As the name signifies, Virtual assistants (VA) provide a great range of “virtual” services to other businesses including general administrative, customer service and over the phone technical support from a home office. Such virtual assistants are growing in popularity all around the world as many companies are looking to cut cost and outsource administrative functions. So if you are disciplined and organized with some background in administration or customer service, then this might be for you. Sign up on website such as ODESK, GURU or Elance and get connected to potential businesses for virtual work or connect with local association or agencies that can help you get started and connect you with clients.
Freelancing is by far the most popular and the easiest way to get started as an independent professional. It offers a huge amount of flexibility and freedom, and can be started with little or no cost. The key is to present yourself professionally and be sure you are legally set to work as a freelancer. Many freelancers get their start by approaching a former employer or customer who could benefit from their services, then branch out as their portfolio and reputation grows. So whatever your skills might be – content writing, web design, graphic designing, video editing, online marketing, tax advisor, or photography – freelancing could be the most satisfying and rewarding method of doing business and helping people.
- Paid Blogger
It is true! You can make money blogging. Choose an industry that interests you and start a blog about it. Pose yourself as a specialist in that field and offer online paid consultation. You could also be asked to blog on other BLOGs as a guest or paid blogger. If you start a BLOG, your income generation opportunities can come in the form of affiliate marketing and advertising on your BLOG/website or from companies who ask you to review and blog about their products. The key here is to keep abreast with all the current social media and search engine optimization trends and be through with your industry.
– Sell stuff online
If you have access to a wide range of products that you could sell, then consider starting an online store on eBay, Etsy or Amazon. Many people start by selling products that they personally own or have picked up at a junkyard or an auction. Or, a better way to do it would be to buy products on wholesale or just adopting a drop-shipping model. The objective is to find products that are in high-demand and not readily available from other sources. With the coming of e-commerce website, online selling is catching up and is becoming an easy platform to make money.
- Start a food business
Food business is demanding but has great rewards to offer. Before you start a home-based food business you will need to understand the rules and regulations that govern the production of food for public consumption in an at-home environment. In countries like India, providing healthy home cooked food to daily office goers is a BIG business. Many housewives cook daily meals and deliver fresh and hygienic food to offices. Unlike traditional catering business, which involves investment and infrastructure costs, such home cooked meal supply business can be started from home and if done correctly, can prove to be a long lasting and profitable venture.
The typical way to start a new business or venture is to first get started with a clear cut business plan, then pitch the idea to potential investors, gather a team, introduce a service or a product and finally start selling as hard as you can. Well, according to a new research done by Harvard Business School, 75% of all start-ups fail, because most of them experience a setback somewhere in the sequence of above events. Things like running out of cash flow, or lack of a proficient team are typical reasons why start-up do not succeed.
In the last couple of years, a new methodology has started appearing, popularly known as the “lean start-up” and it favors experimental approach over elaborate planning, customer feedback over intuition and iterative design over traditional development. The term “lean startup” was first coined by Eric Ries in the year 2011, it originally generated from the philosophy based on lean manufacturing, which is the streamlined production methodology developed in the 1980s by a Japanese auto manufacturing company.
According to the theory, the lean methodology seeks to eliminate wasteful business practices and increase value producing practices during the product development phase so that startups can have a better chance of success without requiring large amounts of outside funding, elaborate business plans, or the perfect product.
So while following a lean startup method a founder or owner doesn’t begin with a business plan, they would begin with the search of a business model. The other notable element of lean methodology is – quick and responsive development. In comparison to traditional product development, where each stage occurs in a leaner sequence and has timelines attached to it, agile development builds products in short and repeated patterns. So for example a manufacturing company following the lean methodology would produce a “minimum viable product” that would contain only the critical features, gather feedback from its customers and then start with the revised and improvised version.
Many big companies are going the lean starup way as they see the tremendous cost advantage in adapting this new methodology. For example, companies such as GitHub, and cloud based services, such as Amazon Web Services, have minimized the cost of software development to millions of dollars. Even hardware companies no longer have to build their own hardware setups, since off-shore manufacturing is so easily accessible.
If we look at the history of management education, we can see it was solely focused on helping students build strategies and tools that formalized execution and efficiency of existing business. With the introduction of the lean startup method, the focus has changed to searching new business models as we launch startup venture. This new methodology is here to stay and would eventually help business owners meet challenges with a new perspective, innovate rapidly and transform the way we do business.
A professional online presence has become the most important elements of any business. Smart devices and location-based applications have brought customers closer to their local businesses. Over 15 million Canadians use their smart device to access information on local businesses every day. So it is crucial that local businesses take advantage of this opportunity of instant and effective online visibility via local search engines and local citation sites.
Here are the top five online business directories where you could instantly list your business for quick visibility and a long term online presence.
Yellow Pages Canada:
YelloPages Canada is among the top 10 websites viewed in Canada. The websites has quiet a substantial amount of user traffic both online and on mobile devices. It also supplies its data to partner sites such as Canada411.ca thus enhancing an business or brand’s exposure in a local niche.
Though not a business directory, Kijiji is a free classified ads site for Canadian local businesses. Posting your ad on this site is free. Kijiji has a huge amount of user traffic and also has an awesome social media presence, thus proving its popularity among Canadians.
HotFrog Canada is an international brand operating in around 38 countries across the globe. The site has around 15 million page views every month and over 670,000 unique site visitors. You can add your business description and even create coupons that will be visible to the web traffic specific to this site.
Profile Canada is one of the most visited local search sites in Canada, connecting customers to local businesses every month. The user traffic on the site is considerably high compared to other online local search websites. It also offers a set of tools to promote your business online called the BOB (Better Online Business).
This directory has information of more than 20,000 business registered in Canada. CanadaOne was Launched in 1998, and has since become one of the most popular directories for local businesses. The website also publishes articles, which in-turn attracts more user traffic.
Hiring foreign employees has always been a tough task for US small business employers. The demand for skilled workers is ever increasing in the small business industry. Founders and entrepreneurs of start-ups have to face an ongoing challenge of finding qualified talent that is ready for hire.
Large technology companies such as Microsoft Corp. and Intel Corp have long urged Congress to increase the quantity of the H-1B visas—claiming there aren’t enough American tech professionals to fill their positions.
According to immigration data analyzed by the Brookings Institution, only about 30% of applications for H-1B visas make it past the preliminary stage of the process, the bulk of which are filed by start-ups and small employers. The biggest problem is that most start-ups and small firms lack human-resources departments to handle the complex paperwork, and the funds to cover legal expenses associated with hiring a foreign worker under the program.
Currently, 65,000 H-1B visas are available for first-time applicants each year, plus an extra 20,000 for advanced degree holders. According to U.S. immigration agency data, majority of these visas are awarded to workers in computer-related fields, mostly from India or China.
Ted Acworth, the founder of Artaic, a Boston-based firm that develops software, said that he hired an Italian national with a mechanical-engineer degree from Boston University, after reviewing nearly 100 applications for a job as head engineer.
But in July this year, the employee’s temporary student visa expired and he is set to return home. “As a small company, I can’t wait 15 months for the chance to get him back” by applying for the next round of H-1B visas, Mr. Acworth said.
Another observation is that higher demand for H-1B visas doesn’t reflect a limited supply of qualified workers, but rather a demand for cheaper workers. Raising the annual visa (H-1B) cap, will lower wages in the IT labor market and chase more domestic IT graduates into different fields.
However, for most small business owners, talent is the most important thing and they don’t mind going through the process of dealing with the hassle of visa paper work and added legal fees. All they are looking for is “the best people to do the job, period”!