One secret formula to starting a successful business with few resources
Many entrepreneurs often ask, how can you create a successful business?
First, let’s define success — many people and companies see success as something that’s long-term and enduring.
How can we achieve this?
Let’s take a look at some of the most successful companies in the world. They are not only the largest and richest, but they have also been around and adapting for a long time — Google, Apple, Amazon and Microsoft.
Are they successful mainly because they have a lot of money, funding and resources to pump into the business?
For the rest of us who are starting small businesses, what if we don’t have so much money? Not everyone is able to raise tons of funding. How can we create a successful business, even if you have to bootstrap with little savings?
How do we even start if we just want to start a simple F&B business, e-commerce, etc?
Consider this scenario: You are trying to open a restaurant in a big city because you think your Grandma’s secret recipe would be a hit. You just need 1% of the city’s population to dine at your restaurant and you would be very rich.
But in this big pond, there’s usually a lot of other fish — other restaurant chains that are much bigger and offer better experiences. They have more money, more people, and bigger networks to fight for a larger piece of the pie. You would not be able to compete with them unless you have as many resources as they do.
On the other hand, no matter how good your secret recipe is, there would also be many other small restaurants offering similar experiences.
And you can’t charge higher prices because there’s another restaurant down the road willing to charge lower prices for similar items.
The competition is too intense. And this often happens when you enter a market with similar undifferentiated products, offering little differences in value to consumers.
So what can you do?
Identify your niche, find a small market, aim to dominate it and move on to the adjacent market.
This is a formula used by large and small companies alike, even the wealthiest companies like Google and Apple. The most important thing is to create value for people and capture that value.
That means starting a business like dropshipping where you are just buying and reselling the same product without creating value for people will not last in the long-run.
If you can create value for people and help to solve their problems in a way that not many other businesses can, you’ll be on to something great here.
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Co-written and edited by Candice Neo.
