What are the benefits and process of starting a new business? Introducing the points and 5 frameworks to increase the success rate!

Starting a new business in any industry involves risk. However, with the right process of planning and an effective framework, the risk can be greatly reduced. This time, let’s take a look at the benefits and processes of starting a new business, and how to increase the success rate.

3 benefits of starting a new business

What are the advantages of beginning another business? First, I will explain the three benefits of starting a new business.

Merit 1. Increase your revenue stream

If you successfully launch a new business and make it profitable, you can increase the pillars of profit as a company. By increasing sales, it will be possible to accumulate profits within the company and invest in management resources (people and things). As a result, we will be able to aim for further growth and development.

Merit 2. Become a long-term risk hedge

The needs of the world change with the times, and the necessary products and services also change. It is undesirable for a company to be dependent on a single product or service. Launching a new business leads to business diversification and serves as a long-term risk hedge for the company.

Merit 3. Can develop excellent human resources

There are various processes involved in launching a new business, and there are many opportunities to develop employees.

In addition, excellent human resources tend to gather in companies that take on the challenge of launching new businesses. Launching a new business can also be effective in recruiting strategies.

6 essential processes for launching a new business

Depending on the type of business and content, many costs are incurred when starting a new business. If the new business does not get on track, the company will be left with a large deficit, so it will be necessary to plan carefully. So, first of all, I will explain the process that can be said to be essential when launching a new business.

Process 1. Find your customers and your own “challenges”

In order to launch a new business with demand, it is necessary to find “customer issues.” If you provide products and services that can solve the problems faced by your target audience, demand will naturally grow. However, in reality, it is not uncommon for motivation to take too much precedence and focus on “what we want to do.” Proceeding with a plan based on this kind of thinking may lead to the possibility of providing products and services that are not required by the market.

An effective way to find the customer’s problem is to look at “the problem you have yourself”. Check existing products and services, markets, industries, etc., and identify demand that has already become apparent from the issues you and your customers have.

Process 2. Decide on a business domain

Even if you find a materialized demand, you shouldn’t make a business plan right away. Proceeding with a plan based on mere ideas will lead to failure, so it is important to assemble each one based on data and evidence.

Therefore, the next thing we would like to tackle is the determination of the “business domain”. The business domain is the area in which the business is developed, and by clarifying this, the business content to be tackled can be seen. There are two ways to determine a business domain: a “physical definition” based on specific products and services, and a “functional definition” based on customer needs and dissatisfaction. This explanation is a bit confusing, so let’s look at some examples below.

As you can see from the above, the physical definition makes it easy to understand the business content and communicate the policy to employees. However, the disadvantage is that it is difficult to expand and develop the business scale in the future because the products and services are already clear.

Process 3. Clarify the philosophy and vision

Companies with attractive philosophies and visions attract excellent human resources. Also, in order for each member to proceed in the same direction without hesitation, it is necessary to have an absolute philosophy regarding management and business. The important point here is to put the philosophy and vision into words. Even if a manager has a rough idea in his head, it cannot be accurately conveyed to others unless it is written down. If you communicate a clear philosophy and vision and each member sympathizes with it, the potential of the company will increase at once.

Also, even when faced with unexpected troubles and difficulties, if the philosophy and vision are firmly established, they should always be reminded of the original purpose.

Process 4. Determining “marketability” and “business feasibility”

If you have made it this far, the content of your new business should have settled to some extent. However, in order to increase the success rate of the business even a little, I would like to focus on analysis and prediction. In order to ascertain marketability and business feasibility, it is necessary to investigate the following points.

Process 5. Prepare the necessary environment for product/service creation

In order to succeed in new business, it is also necessary to prepare the environment. In particular, the following are essential elements for most businesses.

The necessary environment will change depending on the business content; so first of all, identify “what is necessary to create your company’s products and services?” One by one.

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