Dealing with Competition

The running footsteps thundering alongside you, the blood pounding in you rears and through your veins, the racing of your heart – these are the signs of competition, hot on your heels. The market is crowded and everyone is looking for a larger slice of the pie. Welcome the challenges posed by competition and exploit them to sharpen your business dynamics and progression.

Be Exceptional

The line of business may be the same but you have to bring a unique passion to your enterprise. Philosophically speaking, ‘God made all men equal but to beat the competition you have to make yourself unequalled’.

Avoid imitating your competition just because they have a successful business model. Discover a differentiator and use that as the engine for your growth. You will soon leave the competition panting way behind you.

Deepening Markets

Start-ups who wish that they are the only players in the market are legion. If that were to be true it would raise the distinct possibility that the market is too small or too local. The obvious downside is that the prospects of scaling up are restricted and future growth is stifled. Increased competition has the advantage of deepening the market and discovering new pockets of business. Welcome new players in the market. Believe that there is adequate business for everyone and one more person.

Play by the Rules

The temptation to cut corners to generate sales can be overwhelming but entrepreneurs should not fall prey to such an approach. Your competitor may hijack your customer but don’t copy-cat that behavior. The fruits of such victories are usually temporary. If you have given your customer the best possible deal, he’ll soon retrace his steps. In the interim, introspect on what could have been done to retain the customer. Impeccable and matchless customer service is usually guaranteed to keep your customers within your fold.

Beware of Nemesis

Watch the sales graph and keep your ears open for talk of competition, especially smaller operations which have the innate ability to fly below the radar until they suddenly appear as a threat. The smaller guys are fleet footed and prepared to take bigger risks with one objective – to relegate you to second position. If the competition is doing something better than you, go back to the drawing board, step back and review your product and reinvigorate your marketing. You may be the best today but don’t let an over-confident approach turn you into a has-been. Ignore the competition at your peril.

Communicate with Customers

Keep in touch with your customers not just for their post-sales feedback but to build long term relationships. It is far easier and substantially cheaper to retain an existing customer than to discover a new customer. Technology has made communication quick and inexpensive. The simple theorem is that if you are talking to your customer, your customer will not be talking to your competitors.

Be aware of the competition and enjoy being in the thick of it. A dose of competition can have the benefit of sharpening your processes and accelerating innovation to keep you that one stride ahead of the chasing pack.

Keys to Startup Success

In the start-up universe, doomsday stories abound, about the graveyard of entrepreneurship failure being filled with the tombstones of early death start-ups. Confronting the statistic with a diagnostic approach is a constructive approach rather than wringing hands in despair. There are those who succeeded against all odds. The way forward is to learn from the lessons of history; else there is a clear and present danger that history will repeat itself with agonizing consequences.

Exercise Economy

Money will be limited especially in the early stages so treat it as if it is your blood. There is no pressing reason to splurge on an expensive brick and mortar office. Adequate space and functionality should be the guiding principles. Start ups can do without a custom designed web site until the big bucks start to roll in. Your processes, systems and workflow could even be structured on Google Docs. Review every cost to discover whether there is a way to accomplish the task for free. Shun advertising and do legwork visiting exhibitions and trade shows for no charge. Zero costing is impossible but the effort should be to stay within hand shaking distance of zero. Spend small amounts but have a grand vision.

Admit a Mistake

Don’t dread the day that you realize that you have taken a wrong call. The sooner that comes to light the better. Admit your mistake immediately. Assess whether damage limitation is possible by tweaking the business model or the product. If you are left with no other option, be prepared to walk away from the plan. There is really no worthwhile purpose served by being foolhardy and attempting to vindicate your original idea by sending good money chasing behind the bad money. Here’s where staying close to zero costing will bring a wry smile to your face.

Recruit Talent

Experience matters but it is not absolutely essential. If you have the intellectual inputs and knowledge transfer and mentoring skills, look for the right people at compensation that won’t burn a hole in your pocket. Search for people who share your passion for hard work and have a fire in their belly. Build a multi tasking work force and that will move seamlessly within the business.

Network, Network, Network

It may be your business start up but you need not behave as if you along with Google Search are the sole repository of all the wisdom and knowledge in the world. Network your relatives, your friends, your school-mates, your former colleagues and even network their networks, Mine your network for ideas, suggestions, information, guidance and onward references for further networking. Take the initiative in opening a conversation and don’t worry about being rebuffed. You will, at least, be able to tell yourself, “I tried,” rather than “What if I had…”

Stay Together

Binding well with co-dreamers is supremely important. Don’t lose sight of the pot of gold at the end of the rainbow. Synergies of the original ‘A Team’ contribute immeasurably to the success of start-up ventures.

Choosing your Brick and Mortar Location

The revolution in internet and mobile technology has driven business from the physical world to the virtual world. Nonetheless, to manage its back office functions including finance, accounting and human resources, every startup must have a presence on terra firma. When it comes to selecting a brick and mortar location, there is no magic mantra. But, in building the business, the criticality of a well located establishment warrants that key elements must be kept firmly in sight.

Money Talks

There can be no doubt that starting up and keeping any business running needs money. It makes great sense to set up your business where the financiers are housed. That makes one-on-one meetings and conferencing convenient. All said and done, the entrepreneur does have to sell his dream to the prospective financiers and that may call for frequent meetings.

Business Friendly Environment

More than one startup has been carried away by talk of tax breaks and subsidies. But far more important than that, is the startup environment. Focusing on the ease of doing business in terms of access to regulatory information, single window licensing and approvals, a professional education infrastructure that could be tapped into for upgrading not only the skills of the work force but also to add value to the knowledge of the budding entrepreneur, and supply of human resources with a sound work culture will pay far richer dividends in the long run.

Life Quality

The weather and the commute are often regarded as the decisive elements in assessing the acceptability of a location. But, this perspective looks not too kindly on other aspects such as education, medical facilities, recreation venues and cultural aspects including theatre, cinema, etc. The start-up founders and their work force would doubtless have family demands to fulfill. A contented family life has an exponential effect on employee productivity.

Costs

A meagre budget is a given for most startups so limiting cost is an uber important criterion. Competitiveness often comes down to selling your product or service at a price point dictated by a demanding and competitive market. The importance of economizing costs for everything – rent, electricity billing, stationery, et al can hardly be over-emphasised. And the cost of living could have a cascading effect on the pay packets that have to be handed out every month end to employees.

Startup Culture

Search for locations that boast a startup culture that has had time to mature. After all, if startups have already set up shop and are doing reasonably well, even if not actually flourishing, there must be something good about the location. Be prepared for eye-ball to eye-ball contact with competitors. Entrepreneurs must perform their very own due diligence and talk things over with businesses that are struggling. This will help identification of the problem areas and help in ensuring that they have the wherewithal to triumph over the adversities that have thwarted the progress of the slow-coaches. Navigating the business to a good location is not simply about the here and now but equally about the future. Finding a business friendly headquarters calls for dedication to the cause, commitment and an eye for detail. The entrepreneur who makes the right selection will be rewarded many times over.

All about Start Up India

India already boasts the third largest number of start-ups world-wide but these businesses are marooned in red tape, an apathetic banking system and a sluggish bureaucracy. The Start-Up India initiative announced by the Honourable Prime Minister to catalyze an entrepreneurial culture in the Start-Up universe created waves across the country. The move is expected to catapult India to the high table of Start Up eco-systems in the world.

Corpus of Rs.10,000 crore

Government of India has decided to contribute Rs.2,500 crore annually to a fund for a period of four years, thereby building a corpus of Rs.10,000 crore. The corpus will be deployed to fund startup ventures, albeit indirectly, through venture funds that are registered with the Securities and Exchange Board of India. The fund will be professionally managed by representatives co-opted from industry bodies, successful startups and academia.

24 hour registration

The Union Government will be launching a mobile app and internet site that will make registration of start-ups within a day a reality. The portal will act as a single window contact point for all start-ups looking for clearances, registrations and approvals, and seeking assistance under the Startup India aegis.

Regulatory Self- Certification

Start-ups will be permitted to self-certify compliance with laws relating to labour and environment through the app. These enterprises will also be exempted from labour inspections for three years.

Ease of Patent Registration

For the first year, 80% of the cost of registration of trademarks, patents and designs will be reimbursed by the Government.

Credit Guarantee

To encourage banks and financial institutions to supply debt funds to start- ups, Government proposes to establish a credit guarantee arrangement with annual funding ofRs.500 crore for the succeeding four years under the stewardship of a National Credit Guarantee Trust Company (NCGTC) / Small Industries Development Bank of India (SIDBI).

Tax Breaks

Exemption from payment of income tax for the first three years will help start-ups to retain cash flows which could be ploughed back for research & development, marketing expenses and such largely intangible but essential expenses that are typically excluded from bank financing. In addition, to incentivize venture funds to finance start-ups, the profits earned by them on investments in start-ups will be exempted from capital gains tax.

Public Procurement Norms

The ‘prior experience’ criterion will be excluded by the Union and State Governments and Public Sector Undertakings (PSU) while considering bids of start-ups provided they satisfy the tendering organisations that they possess the core competency to otherwise execute the project successfully.

Voluntary Exits

The Insolvency and Bankruptcy Bill, 2015 has a provision for voluntary closure of operations. Start-ups will be provided with a fast track passage that will enable them to shut shop within 90 days from the date of their application.

Hub for Collaboration

The planned Start-Up India Hub will include all players in the start-up system – governmental, institutional and academic – who will work synergistically to support, guide and mentor start-ups.

The Start-Up India initiative is ambitious and, successfully implemented, could prove to be a game changer in the business world.

Building Your Business

Not Harvard, not Stanford, not Wharton, not Berkeley – no business school in the world can prepare you for the hurricane that will hit you when you enter the real world of business. No wonder then, that the virtual world is chock-a-block with articles about “What they never taught you at business school”. The sterility of the classroom is far removed from the near chaotic landscape that you will be confronted with once you begin your business building journey.

The Product Matters

Venture capital is not the answer to all your prayers for the simple reason that it’s the product that matters not the big bucks. Make sure that your product meets a distinct need of your prospective customers; a need that is not being catered by existing players. If you are making a foray into a crowded market, your product must have features that can convince clientele that it is demonstrably superior to those of your competitors.

Media Matters

There was a time when a big splash advertisement campaign could manufacture demand for an average product that did not really have any lasting calibre. In today’s connected world, it would take mere days for Whatsapp, Facebook and Twitter to destroy any semblance of credibility of your company. On the flip side, this very same social media can be harnessed to maximize first hand word-of-mouth feedback regarding the intrinsic worth of your brand.

Customers Matter

Stay connected with your customers. Never forget that the time invested in satisfying a customer need will give you unimagined dividend. A satisfied customer is by far the most efficient advertiser for you. Through word-of- mouth and on social media platforms, the happy customer will proclaim the values and virtues of your products. Unimaginable but true – you make a profit out of your business with the customer and, to top it all, he takes pleasure in endorsing your product – and at no charge.

Processes Matter

Publicity campaigns, advertising in digital, visual and print media are an integral part of building a business. Institute a system that tracks the number of leads that are being generated from each channel of advertising. Track the actual conversion rate so that you get a clear idea of which are the campaigns that are giving you the biggest bang for your buck. That is where you should be investing your resources.

People Matter

The people you hire should share your passion and be ready to obsess about their work – ready to ‘work like a beaver, think like a fox, charm like a cat and see their veterinarian twice a year’. Keep in mind that it is only machines that have a limited capacity, human beings have unlimited capacity. Be a friend, philosopher and guide to your people and help them to unleash their potential.

Money Matters

Your money matters and so does that of your investors. Make every cent count but remember that no matter how much money you invest in the business, the road ahead will not change. It will be an uphill struggle but focusing on the resources that matter with the right attitude will get you to your dream destination one day in the not too distant future.