Vendu Learn Series: Starting your first business
Editors’ note: Vendu Learn Series is a medium which we will be using to share tips, insights, and experiences from established entrepreneurs and industry professionals on different aspects of building a business from selling to customers to legal frameworks, etc.
Our speaker for the very first episode of the Vendu Learn series which held on the 21st November 2020 was our business lead and co-founder, Ifeoluwa Oderinde. He is a serial entrepreneur, MEST Africa alumnus & the curator of TedXEastLegon.
Here are some of the excerpts from the session;
- Know yourself: Do a personal evaluation and work in a job that caters to your strength, stimulates and challenges you.
- Ask yourself such questions such as, why do you want to start a business? Is it money, freedom, and flexibility, to solve a problem
- What are your skills? What do you like to do? What are those things you know how to do well with very little effort?
- Do you want to provide a service or product?
Answers to these questions whether positive or otherwise are not to dissuade you from starting your business, rather, it is to set you thinking and planning. To help you narrow your focus, work on your strength and compliment your weaknesses.
2) Analyze your industry: The more you know about your industry, the more advantage and protection you will have. Researching your business and industry you will like to go is a reality check to get you thinking on what works, what doesn’t and how to carve a niche for yourself in that market with a unique proposition.
There are a number of ways you can do this, including performing general Google searches, speaking to people already working in your target industry, reading books by people from your industry, researching key people, reading relevant news sites and industry magazines and taking a class or two (if this is possible).
3) Evaluate your target audience: Validate/test your business idea by building the smallest inexpensive version of your idea and test it with your target audience. For someone who wants to start selling cars, go to a car mart, take pictures of the available cars and share them with friends and family, even post them on your social media channel.
Thinking and getting answers to these questions will help guide you:
- How urgently do people need the thing you’re selling or offering right now?
- What’s the market size? Are there already a lot of people paying for products or services similar to yours? Have you honed in on who exactly your target market is? Being specific will help you focus your marketing message and investment.
- How easy is it (and how much will it cost you) to acquire a customer? If you’re selling enterprise software, this may require a significantly larger investment than a coffee shop.
- How much money and effort will it cost to deliver the value you would like to be offering?
- How long will it take to get to market? A month? A year? Three years?
- How much up-front investment will you need before you can begin?
Will your business continue to be relevant as time passes? A business that repairs iPhone X screens will only remain relevant so long as the iPhone X sticks around. If your business is only relevant for a specific period of time, you will also want to consider your future plans.
4) Setup your business: Incorporate your business and get regulatory licenses in your industry of operation. This will help brand you as a solid entity and position you towards receiving some institutional funding.
5) Start the planning process: If you will be seeking outside financing, a business plan is a necessity.
But, even if you are going to finance the venture yourself, a business plan will help you figure out how much money you will need to get started, what it will take to make your business profitable, what needs to get done when, and where you are headed.
They don’t have to be those 100-page documents, maximum of 5 for now. There are even such one-page document called the business model canvas (BMC)
6) Have a plan for funding: Depending on the size and goals of your venture, you may need to seek financing from an “angel” investor or from a venture capital firm.
But, most small businesses begin with your savings, a loan, financing from credit cards (in much saner climes), help from friends and family, and so on.
7) Set up your Space: Your business plan has been laid out, there’s some money in the bank, and you’re ready to go. If your business is online and you won’t need a physical storefront, you’re probably looking at building your website and choosing a shopping cart solution.
Maybe you’ll be able to work out of a home office or a co-working space instead of renting or buying office space. But if your business needs a dedicated brick and mortar location, there are many considerations;
- Finding a location.
- Negotiating leases.
- Buying inventory.
- Getting the phones installed.
- Having stationery printed.
- Hiring staff.
- Setting your prices.
- Throwing a grand opening party.
Your business location will dictate the type of customer you attract, what types of promotions you can run, and how long it will take you to grow. While a great location won’t necessarily guarantee your success, a bad location can contribute to failure.
8) Prepare for trial & error: It is all an experiment, you’ll fail and iterate as you go on. If you do not make mistakes, you do not learn what to do less of and what to emphasize. Be open-minded and creative, adapt, look for opportunities, and above all, have fun!
Vendu is a retail platform that connects African businesses to independent entrepreneurs who are interested in making profits from reselling through their social channels.
Join our growing community of resellers on Telegram here bit.ly/sellwithvendu