I’ve met many excited people with ideas that they thought were million-dollar winning business opportunities. Nope. Didn’t turn out that way. Implementation was far more demanding than they thought. And, worse, the buyers just didn’t materialize as explained on paper. One can head off much stress and many problems if at the very beginning, before investing one cent, the entrepreneur satisfies these questions:
- “Is your value proposition compelling enough to be the seed of a business?”
- “Is your market size large enough to profitably support your business against all current and future known competitors?”
Of the above 2 questions, question #1 is the more important one. Be sure you know your COMPELLING VALUE PROPOSITION.
A compelling value proposition describes in a few words EXACTLY why a purchaser will want to visit your place of business, (either brick & mortar or online), and why they will want to give you their money. If this answer is so powerful, so “compeling” that it makes you and those around you say, “Wow!”, then you may have a fighting chance.
Your compelling value proposition should answer questions such as:
- What is it that you do, or plan to do, that is so much better than what exists today?
- Why do people want to do business with you and your establishment and not some other?
- What keeps them coming back for more?
- Will this survive after it attracts the attention of the 800-pound gorillas in marketplace and why?
I can’t stress this point enough: your business model must be built on a COMPELLING VALUE PROPOSITION. That means you need to do some research and homework about what will motivate your customers.
Unless a start up clearly knows its COMPELLING VALUE PROPOSITION. (CVP), before it opens its doors, it will LIKELY go bankrupt and stress out the business principals during the entire time the business is trying to get onto its feet.