An important way to save time and money starting up your business is to test your hypothesis, and I break these down into Plan A and Plan B. Plan A is of course what I uniquely teach (although it is commonly executed by those who thrive in this business) and Plan B is the harder, more unlikely way to start, although Plan B is what most people assume the biz is all about.
A twist on this is selling of services. So often people just assume there is a customer, based on anecdote. The key here is again, testing your hypothesis, testing whether people will buy a service from YOU.
The way to do this is simply ask: Pick a customer you would expect to be yours if you began a business, and propose “I believe I you would pay me 10% of your savings if I could shave 25% off your hotel bill budgets. Am I right?” No need to try to sell anything, just test your hypothesis. Do this before you put a dime into your business: before cards, before logo, before license... before anything.
As usual, testing the hypothesis helps the design process,since if the answer is “no” the potential customer will tell you why. That reason is what you need to work on.
There is more to this process, and this meeting. If they like the service you propose, then ask why they will work with you, and not someone else. The reason may surprise you. Listen closely, the reason will tell you what to work on. The reason is likely to be something smaller than you think... hard to explain right now, but ask these people how come YOU, and not someone else. A good way to ask is “What exactly is it you want me to do for you?”
Ken Wong at HK PolyTech has as a topic “business start-up as personal transformation.” I think this is a fascinating topic. Being shot down as you start up a business tells you what you need to work on, personally.
Often we assume people want to hire for one thing, but later find it it is for another thing. Make sure you understand clearly why they want YOU. And then build your service design around that, and nothing else.
Friday, May 7, 2010
Selling Services - Test the Hypothesis
Thursday, May 6, 2010
Lower Prices, Labor Shortages In China
The textile biz is in inflation/deflation bind right now, with labor shortages forcing wages up and prices paid forcing gross down. Here is a report form Asia.
Tuesday, May 4, 2010
This Regime Costs Too Much
The government wants more money for security cameras, and the US Supreme Court is closing off its front entrance. The Hamiltonian regime is designed to skim off s much profit for the powers that be as possible, and pass the cost onto taxpayers. The die was cast before the constitutional convention in USA, a convention that came down on the side of the Hamiltonians, while giving lip service to the Jeffersonians.
I like the idea of more security cameras, but only for private property owners. A hotel, airline, movie theatre, all should have plenty of cameras to assist in keeping their guests safe and happy. The content of those films should be private property as well, only used by the property owner, and only available to a govt agency upon a search warrant. For most Americans, what abuse they will encounter will be at the hands of a govt worker, so we should have a law, as long as we have govt, that an and all govt interactions may be videotaped by any one of the participants. Along with Miranda rights, we should have the right to videotape any interaction with govt agents. Govt abuse would likely cease.
In seattle the Federal Court Building has been retrofitted to withstand some serious assaults. This plus the new cadre of guards, is very expensive. It adds to the cost of the courts, at a time when cities, counties and states are scrambling for funding for basic services. It does not say much for a system that must defend itself so. Starbucks has no security systems that I can see, because it is voluntary, and well, the stakes are low. The stakes are much higher in the court system, due to the relative lack of rule of law: going into court, no one has any idea how things will turn out. Gandhi was probably the last lawyer to advise anyone what the litigant should do, now lawyers advise what you could do. Big difference.
Most of the problem here, in business anyway, is that business people convert business problems to legal problems too quickly. At the big biz level, when your mischief invites litigation, mischief makers just back off and let "corporate counsel" handle it. Years later, when the dust settles, the mischief makers have moved on and up. No accountability, no responsibility.
When faced with something unpleasant in business, do not jump to legal recourse. If faced with a legal threat, suggest to your business opponent that the two of you first try to settle the business problem on the business level. Then, if that does not work, your opponent is always free to bring in the lawyers. Usually works.
I found US History boring in school. I find it fascinating when presented by non-regime scholars. The story of Shays's Rebellion will teach you much about USA. It has fascinating parallels on how things are going today, and may even offer some predictive advice.
Monday, May 3, 2010
1099 Madness
In its inexorable drive to crush small business in USA, the health care bill carries a new requirement for all businesses, a requirement that has nothing to do with health care. As Pelosi said, "You have to pass it to find out what it says." We all should be reading Mish Shedlock every day.
Now a Third Means?
I blogged earlier that there seemed to be a debate as to whether state control would be by drugs, as Huxley predicted (Brave New World) or by thought control, as Orwell predicted (1984). My assessment was the decision had been made in USA: Both. Now we see a third, far more traditional means of control is being introduced, in New York City: Salt.
Throughout history salt production and distribution was controlled by the powers that be since without salt we die. It has the advantage of control being applied lightly or harshly, as dissidence to a regime might require. Gandhi was never taken seriously until he challenged the British monopoly on the salt trade in India.
You can pick up Huxley and Orwell in any used book store, or ask any college kid for his copy. Classics well worth the read. People tend to keep their copy of Salt, so pick it up on amazon.com.
Sunday, May 2, 2010
Which HTS Number?
Getting the right HTS number for your product can be tricky, because the description associated with an number can be quite specific. The only way to tell for sure is either bring the stuff in to test customs, or pay them to find out in advance. So we manage it... say the goods come from Argentina, is the duty the same for each number, or is one duty higher? If so use the higher duty number, until you actually bring in the goods... cost the shipment at the higher duty... and then when you actually bring in the goods, customs will eventually rate it with the right number. You shouldn't owe anything since you used a higher number. You might even earn a refund. Customs may take up to a year to get you the final answer. Since we cannot afford an answer in advance, we manage what we can