Starting any business is challenging. Starting a direct sales business is no different. If you’re considering taking the plunge into entrepreneurship, you should take some time mulling it over. After all, once you’ve started a new business and taken the plunge, it’s often hard to backtrack.
These questions may help you to decide if you’re ready to ‘take the plunge.’
What is My Vision?
An essential component of your business is the basic idea: the way that you provide value to other people. It doesn’t matter whether you’re starting a direct sales business or building a rocket, you need to have a consistent vision to go the distance.
Successful entrepreneurs try to put their vision to the test by seeking feedback from people already operating in the market whether they think it is viable. They’re relentless about talking to customers (or prospective customers) about their value proposition and adapt their pitch (and sometimes their product) to make sure their vision aligns with the market. After all, it’s the market that pays the bills, not your idea.
In the world of direct sales, your vision may be to dominate a specific geography. It may be to build up to a certain number of reps. Or, maybe it’s a sales target you’re trying to hit.
Whatever it is, make sure the vision is clear (and it aligns with your personal goals).
Do I Have The Ambition To See The Business Through?
Even if you have a great idea for a product, you need to have the drive and ambition to see the business through to completion. It shouldn’t just be about financial gain, but being driven by something deeper: a passion that you would like to share with the world.
There will be hard times. Really hard times. You’ll have trouble with customers, vendors, and employees. You’ll find yourself pushed to your limit…and then someone will ask for more.
Without that passion, it will be really difficult to get past the challenges.
Do I Have A Product Or Process That Can Scale?
You may have a great product that people love, but if you can’t scale production and distribution, then it’s unlikely that you’ll be successful over the long-term. To be clear, that doesn’t mean you need to have all the mechanisms for scale on day one. In fact, you won’t be able to afford to have everything in place on day one.
However, successful entrepreneurs have a model in their heads of how their business can be deployed on a large scale. Even if you opt not to grow as large or as fast as you possibly can, having the model in mind will keep you disciplined and focused as you prepare to execute.
Do I Have Sufficient Financial Backing To Make My Ideas Work?
Of course, money matters.
You don’t need mountains of cash; just enough to see through your initial plan and execute. Out of the gate, you want to make sure you can afford to pay your subcontractors or sales commissions (if you’re paying commission before you collect revenue).
Before starting your business, model your projected costs & some sales numbers. Try different scenarios, so you know what your break-even and stress points are. For instance, at what point does it make sense to quit? When should you double down?
Money isn’t the solution to all your problems (it can’t make up for a product that people don’t want), but it can take your mind off things that could distract you from building your business, such as worrying about paying bills.
What’s My Plan to Execute?
Many small businesses build great relationships with their customers. Still, more than 95% fail before the five-year mark because they do not execute well. Poor execution erodes customer confidence, which can kill a business.
If you’re not execution-minded, you should consider partnering up with someone who is or working with a team that has a playbook you can follow to make execution easier.
Do I Value People?
Although having plenty of money in the bank helps to take some of the worry off the table, financing does not create a successful company. What matters is human capital: the ability of people in the firm to work towards shared goals.
As you grow, they’ll be responsible for most of the execution. Choosing the wrong people can doom your business, while choosing the right ones can help you hit your goals faster than you expect. If you’re starting a direct sales business, you should expect a lot of turnover until you’ve got the right people management processes in place.
Starting a business is challenging, yet rewarding. If you’d like to capture a lot of the upside, but minimize the risk, you might consider finding a great subdealer to work with. That way, you can take advantage of their training, systems, and processes that already have proven results without sacrificing the opportunity of owning your own businesses. If you’d like to learn more, we invite you to learn more & reach out today!