Dos and Don’ts of Business Start-up

Posted by Staff Writer on Sunday, July 26, 2009 at 8:07am.

Entrepreneurship is an art, not a science. That is why different experts on the topic give conflicting advice. That’s why it is important for an entrepreneur to know his or her business style. Some people are very comfortable with risk, even if that means they might lose their business. Some business owners prefer to play it safe and risk very little, even if that means their company grows more slowly.

When two or more people are in business together, it is important that they have similar business styles - or at least learn to accommodate each other’s styles.

Here is a collection of conflicting business advice from various U.S. experts. Use it to spark a conversation and determine your individual business style for the growing African market.

Do Find a Big Idea

Selena Cuffe was at the Soweto Wine Festival when she found her “big idea.” Selena and her husband Khary Cuffe were U.S. executives looking for a business idea in Africa. They wanted to stop working for major conglomerates and found their own business helping African entrepreneurs. As soon as Selena tasted the delicious wines of the region, produced by black vintners, she had her inspiration. Heritage Link, their U.S. company, helps small wine producers sell their products in the U.S.

Don’t Wait for the Big Idea

Sometimes the “big idea” isn’t so big. Many businesses are formulated around a tried-and-true business concept like cell phones, internet access or retail stores. Providing a familiar service or product in a new location, especially a rural location, can be very successful.

Many entrepreneurs have made names for themselves by taking an existing business model and making a slight improvement, especially if those improvements involve better customer service.

Do Take Some Risks

One of the premiere business magazines in the U.S., Entrepreneur.com, recently ran an article on how to run a risky business. That is especially important advice in a poor financial climate, where nearly any business is risky.

The advice for risky businesses included:

• Develop your skills and learn about yourself by taking risks
• Don’t second-guess decisions; move ahead confidently
• Remember that each misstep or false start is an important lesson
• Accept that there is no crystal ball, and you are going to make some mistakes
• Stop worrying
• Keep stepping out of your comfort zone
• Don’t be a perfectionist
• Continue learning

Don’t Take Too Many Risks

Several experts suggest asking “If we take this risk, what is the worst outcome?” If the answer is that the business will fail, that may not be an acceptable risk to take. On the other hand, if the answer is that you will lose $100 invested in an advertising campaign, that may very well be an acceptable risk to take, depending upon your financial situation.

“Never risk more than you can afford to lose, in gambling or in business,” says gaming mogul Steve Wynn, owner of a popular hotel and casino in Las Vegas, USA.

Do Learn from Your Mistakes

When the American snack-cakes “Twinkies” were first invented during the Great Depression of the 1930s, they were banana-flavored. The banana Twinkies were moderately successful because consumers were looking for a cheap, sweet treat to take their minds off their economic troubles.  It wasn’t until the company ran out of banana flavoring one day, and made a vanilla version, that Twinkies became wildly successful.

In fact, “Twinkies” launched an American junk-food craze that many consider unfortunate.

The “Twinkies” mistake actually turned into a great success. However, not all mistakes are successful. When a particular advertising campaign, product or idea is not successful, just learn from the experience and go on.