There is no “Straddling the Fence”
You are fresh out of college or university and teeming with enthusiasm to do something on your own and make a mark in the world. But what will you do? You may have some half-baked ideas of what you want to do or no ideas at all, but don’t let that dampen your spirits.
*Your mission is to find a product or service that can positively impact the lives of 1 billion people because that’s the game we’re playing today. Peter Diamandis
Many entrepreneurs have been in the same boat and have managed to work their way out of the dilemma. For me the break came about mid-way through my professional life and today I am doing something I am passionate about, such as creative writing and instructional design and so on.
The first challenge in your entrepreneurship journey is to determine whether to pursue a product or service, the proverbial million dollar question. There is no mathematical formula that will clearly tell you what to do. Technology can help you build your business but you must decide for yourself what you want to do.
At the initial stages it is easier to setup a services business than a product business. A service can be easily tailored to customer requirements by tweaking a process here or including a step there. In the case of a product customization is more difficult.
From the long-term perspective, a service is harder to maintain as customer expectations keep increasing. Online shopping is moving from desktops and laptops to hand-held devices. On the other hand a product company can just introduce or adjust features to an existing established product and maintain its demand. In most cases automobile upgrades are cosmetic and do not require a modification of the basic component, the engine.
The scalability factor of products is better than for services. Scaling up for products requires lower investment in terms of resources. However, services businesses attract more funds even at the nascent stages.
Marketing a service will turn out to be less expensive and easier than a product. Especially when targeting a new market, services can be easily adapted, whereas a product will require more marketing effort particularly if you do not want to go in for customization.
Errors and bugs in a product are a lot more systematically handled and not influenced much by the customer. A service, on the other hand, is an evolving phenomenon and highly influenced by customer feedback, hence becomes more expensive to maintain.
The risk involved in a service startup is considerably lower than in a product startup, and the payment realization cycle may include credit periods and buffer periods and to cap it all you will need to spend effort in following up. It may be difficult to market and ship products, but once a sale is made and the product is shipped, the payment is normally done up front.
Entrepreneurship is all about an idea that creates differentiated business value to one’s customers. You must be able to convince your customers about the benefits that association with you or your products will give them. People are ready to pay if they are convinced about your services or products. N. R. Narayana Murthy
With the question of “product” or “service” out of the way, you will need to decide on which idea to move forward with. One of the prime objectives of most startups is to make money. Hence, the question of what to sell that will make money requires careful consideration.
If you have an idea, you have to believe in yourself or no one else will.Sarah Michelle Geller
Your offering should ensure a large and easily accessible segment of loyal customers. A wise and informed decision is essential as this decision can either shape your company into a total success or it can categorically junk your company. George Rodriguez has outlined several questions that will help you to narrow down the option(s) you should work on. (The link to the article is mentioned in the references.)
Now that you have decided the line of business and what your startup will build, how about a name for your company? Ideally, your company name should be an extension of what you are creating.
Sometimes all the marketing insight in the world can’t move a client, but the creation of a truly great brand name can become a billion-dollar idea! George Lois
Tito Philips suggests a very practical approach with his 3 principles for naming a companyFunctionality, Memorability and Simplicity. In addition, you may refer to Marketing MO’s suggestions on how to select a name.
* Use the founder or inventor’s name: Bharti Enterprises.
* Describe what you do: The Associated Cement Companies Limited, now known as ACC Limited.
* Describe an experience or image: Reliance Industries.
*Take a word out of context: Jabong.
* Make up a word: KyaZoonga.
I will leave you to reflect on this remarkable quote.
I don’t want to do anything and everything. I want to be a brand that, every time I leverage my name, I want people to feel sure that it’s going to be something good so whether it be my movies, my perfume, my restaurant, my musical, it’ll be good work, good food and good everything. Shilpa Shetty
1. Srinivas Kulkarni. 5 tips for entrepreneurs on how to choose between product or service. 2013. http://www.zdnet.com/article/5-tips-for-entrepreneurs-on-how-to-choose-between-product-or-service/
2. George Rodriguez. What to Sell: How to Select the Right Product for Your Business. 2013. http://www.powerhomebiz.com/starting-a-business/choosing-a-business/what-to-sell-how-select-the-right-product-for-your-business.htm
3. Paul B. Brown. How Do You Choose Between Two (Or More) Good Ideas? 2013. http://www.forbes.com/sites/actiontrumpseverything/2013/08/21/how-do-you-choose-between-two-or-even-more-good-ideas/#1ac6b7c06926? Brian Tracy. Choosing a Product or Service to Sell. 2005. http://www.entrepreneur.com/article/78778
4. Jeanne Holden. Choosing a Product and a Market. 2008. http://iipdigital.usembassy.gov/st/english/publication/2008/06/20080603214320eaifas0.7679407.html#axzz3zxnVTwX0
5. Tito Philips, Jnr. How To Choose A Unique Brand Name For Your Business, Product Or Service See more at: http://www.naijapreneur.com/choosing-a-brand-name/#sthash.QOjtxNwt.dpuf. 2012. http://www.naijapreneur.com/choosing-a-brand-name/
6. Marketing MO. How to Choose a Great Brand Name. http://www.marketingmo.com/creative-brand-development/how-to-choose-a-great-brand-name/