p.p1 customers. Positioning or your USP involves planting

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1. Find Your Unique Positioning or (USP)
This is how you state you’re different from your competitors. It’s your unique positioning in the market and it must be developed after you’ve defined your ideal customer. Scheduling some time to ask your best customers why they do business with you, may offer some insight into how you are different in ways that will attract other potential customers.

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Positioning or your USP involves planting “seeds of perception” in the minds of prospects and customers, which by-the-way are already crowded.
Examples:
First Responder Cleaning. There are very few one-of-a-kind commercial cleaning services. They offer a 30 minute response time
Punctual Plumber. We’re on time — offers to pay commercial customers $5 for every minute they’re late up to $300
Attorney’s are notorious for not returning phone calls in a timely manner — one attorney offers a Return Call Guarantee. If clients’ calls aren’t returned in one business day, they’ll take $500 off the client’s next invoice
Contractors frequently overbid projects and rely on the power behind their license as a justification — Guarantee your work to pass Building and Safety inspection or you will fix it for free
Customer support don’t really care if you find a solution or not — offer a No Hang Up Guarantee “We don’t hang up until you’re happy”
Marketing agencies and firms known for unclear deliverables, lack of results and using confusing language — one marketing firms offers a very detail “proof of concept” with a set project price and clear deliverables.

 2) Business Model Failure
As outlined in the introduction to Business Models section, after spending time with hundreds of startups, I realized that one of the most common causes of failure in the startup world is that entrepreneurs are too optimistic about how easy it will be to acquire customers. They assume that because they will build an interesting web site, product, or service, that customers will beat a path to their door. That may happen with the first few customers, but after that, it rapidly becomes an expensive task to attract and win customers, and in many cases the cost of acquiring the customer (CAC) is actually higher than the lifetime value of that customer (LTV).

The observation that you have to be able to acquire your customers for less money than they will generate in value of the lifetime of your relationship with them is stunningly obvious. Yet despite that, I see the vast majority of entrepreneurs failing to pay adequate attention to figuring out a realistic cost of customer acquisition. A very large number of the business plans that I see as a venture capitalist have no thought given to this critical number, and as I work through the topic with the entrepreneur, they often begin to realize that their business model may not work because CAC will be greater than LTV.

The Essence of a Business Model
As outlined in the Business Models introduction, a simple way to focus on what matters in your business model is look at these two questions:

Can you find a scalable way to acquire customers
Can you then monetize those customers at a significantly higher level than your cost of acquisition

3a) RELEASE PRODUCT AT THE WRONG TIME
If you release your product too early, users may write it off as not good enough and getting them back may be difficult if their first impression of you was negative. And if you release your product too late, you may have missed your window of opportunity in the market. As a Calxeda employee said, “In Calxeda’s case, we moved faster than our customers could move. We moved with tech that wasn’t really ready for them – ie, with 32-bit when they wanted 64-bit. We moved when the operating-system environment was still being fleshed out – Ubuntu Linux maker Canonical is all right, but where is Red Hat? We were too early.”

3b)  LOCATION, LOCATION, LOCATION
Location was an issue in a couple different ways. The first was that there has to be congruence between your startup’s concept and location. As Meetro wrote, “We launched our product and got all of our friends in Chicago on it. We then had the largest papers in the area do nice detailed write-ups on us. Things were going great…The problem we would soon find out was that having hundreds of active users in Chicago didn’t mean that you would have even two active users in Milwaukee, less than a hundred miles away, not to mention any in New York or San Francisco. The software and concept simply didn’t scale beyond its physical borders.”

Location also played a role in failure for remote teams. The key being that if your team is working remotely, make sure you find effective communication methods; else lack of teamwork and planning could lead to failure. As Devver wrote, “The most significant drawback to a remote team is the administrative hassle. It’s a pain to manage payroll, unemployment, insurance, etc in one state… for a small team, it was a major annoyance and distraction.

4)Funding 
 Capital and access to capital has been a perennial problem for startups. While, of late angel investors, venture capital and private equity have brought succor to some extent, a large number of startups still grapple to raise funds from institutional setup. Funding challenge is not merely limited  .. 

5)  Capital
The challenge: You want to start or grow your business, but you have little capital to do it with.

The solution: There are many ways to earn funding, from traditional bank loans to family and friends to Kickstarter campaigns. You can choose these routes, certainly, but I prefer the self-fueled growth model in which you fund your own business endeavors.

Instead of trying to launch a multi-million dollar corporation overnight, focus on your initial core customers. Continually work to find new customers, of course, but consistently strive to be remarkable to those customers you already serve. Word-of-mouth will spread, and more customers will come looking for you. As they do, develop systems and business processes that allow you to delegate tasks without sacrificing quality. Your business will grow slow and steady, and you’ll be able to solve problems while they’re small.

Think about where you want to be five years from now. Can you get there without help, even if you have to delay growth a bit while you’re doing it? This is the best strategy to adopt for small business entrepreneurs. If you do feel you need funding, however, be sure to consult an attorney to make sure you’re not giving up too much of your business to get it.

6) No Historical Data
New start-ups often face the problem of just not knowing what is going to happen or what should happen. Launching a new business concept to the market or even for the business owner themselves with little knowledge of the industry can be extremely hard to plan for, as there are no expectations.

 

However that doesn’t mean its the end of the road and the dream…
The franchise market is growing rapidly at the moment with an estimated turnover of over £12 billion last year, up another £2 billion on previous years. This market is thriving at the moment due to the unsteady market conditions (with the financial collapse only a while ago and the unrest in the international markets especially across Europe) and the reassurance of buying into a proven profitable business model.

Franchises are proving ever more popular due to the weight it lifts off all the problems that start up firms will face. We say the main problems being:

7) Financing
Experienced entrepreneurs don’t have it easy when it comes to funding a new business, but they do have a few advantages over newcomers. They might have a pool of capital from a business they previously sold or a steady stream of revenue they can use to fund a new business’s cash flow.

Even if their first business went under, they’ve likely made investment contacts and client connections necessary to give them a leg up in a new enterprise. As a new entrepreneur, you’ll be starting from scratch, which means you’ll need to start networking like crazy and thinking through all your possible funding options before landing on one.

8a)   Time management
The challenge: Time management might be the biggest problem faced by entrepreneurs, who wear many (and all) hats. If you only had more time, you could accomplish so much more!

The solution: Make time. Like money, it doesn’t grow on trees, of course, so you have to be smart about how you’re spending it. Here’s how:

Create goal lists: You should have a list of lifetime goals, broken down into annual goals, broken down into monthly goals, then broken down into weekly goals. Your weekly goals, then will be broken down into specific tasks by day. In this manner, what is on your task list in any given day is all you need to do to stay on track with your lifetime goals
If any tasks do not mesh with your goals, eliminate it or delegate them
If any tasks do not absolutely have to be completed by you, delegate them
Consistently ask yourself: “Is what I’m doing right now the absolute best use of my time?”

8b)Delegating tasks
The challenge: You know you need to delegate or outsource tasks, but it seems every time you do something gets messed up and you have to redo it anyway.

The solution:  Find good employees (see above) and good outsourced contract help, for starters. You might have to pay a little more for it, but the savings in time (and the resulting earning potential) more than make up for it.

Next, be ultra-specific as to what you want done. It will take a little more time at first, but write down detailed steps listing exactly what you want your help to do. Don’t make assumptions, and don’t assume your help will be able to think for themselves (they can, but they will complete the job verbatim because that’s what they’re trained to do). So, don’t say “list stats in a spreadsheet” when you can say “alphabetically list XYZ in the right spreadsheet column, then list statistic A in the next column.” It might seem like overkill, but take the time to be specific once and your help will get it right every time thereafter.

9)  Dealing with the unknown
How long will your business exist? How profitable will your business be? Will customers like your product? Will you be able to give yourself a steady paycheck? None of these questions has a solid, reliable answer, even in startups based on great ideas with all the resources they’d theoretically need.

That unknown factor means your job stability is going to plummet, and many of your long-term plans will remain in flux as new developments emerge. Dealing with this volatility is one of the hardest parts of emerging as a new entrepreneur.
10)  BUILDING A SOLUTION LOOKING FOR A PROBLEM, I.E., NOT TARGETING A “MARKET NEED”
Tackling problems that are interesting to solve rather than those that serve a market need was cited as the number one reason for failure in a notable 42% of cases. As Patient Communicator wrote, “I realized, essentially, that we had no customers because no one was really interested in the model we were pitching. Doctors want more patients, not an efficient office.” Treehouse Logic applied the concept more broadly in their post-mortem, writing, “Startups fail when they are not solving a market problem. We were not solving a large enough problem that we could universally serve with a scalable solution. We had great technology, great data on shopping behavior, great reputation as a though leader, great expertise, great advisors, etc, but what we didn’t have was technology or business model that solved a pain point in a scalable way.”

11) RELEASE PRODUCT AT THE WRONG TIME
If you release your product too early, users may write it off as not good enough and getting them back may be difficult if their first impression of you was negative. And if you release your product too late, you may have missed your window of opportunity in the market. As a Calxeda employee said, “In Calxeda’s case, we moved faster than our customers could move. We moved with tech that wasn’t really ready for them – ie, with 32-bit when they wanted 64-bit. We moved when the operating-system environment was still being fleshed out – Ubuntu Linux maker Canonical is all right, but where is Red Hat? We were too early.”

12)BEING INFLEXIBLE AND NOT ACTIVELY SEEKING OR USING CUSTOMER FEEDBACK
Ignoring users is a tried and true way to fail. Tunnel vision and not gathering user feedback are fatal flaws for most startups. For instance, eCrowds, a web content management system company, said that “We spent way too much time building it for ourselves and not getting feedback from prospects — it’s easy to get tunnel vision. I’d recommend not going more than two or three months from the initial start to getting in the hands of prospects that are truly objective.”

Similarly, VoterTide wrote, “We didn’t spend enough time talking with customers and were rolling out features that I thought were great, but we didn’t gather enough input from clients. We didn’t realize it until it was too late. It’s easy to get tricked into thinking your thing is cool. You have to pay attention to your customers and adapt to their needs.”