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CHAPTER 8: SELF-ASSESSMENT CHECKLIST

  1. Why are you thinking of going into business?
  2. Have you discussed starting a business with your family?
  3. How would you describe your industry experience?
  4. What business management skills and experience do you have?
  5. What does your past coaching or training include?
  6. Why have you chosen this business and this industry?
  7. Have you prepared a business plan?
  8. What do you see as the biggest obstacles in your business?
  9. Can you accurately describe your targeted customers in terms of age, demographics, behaviors, and other parameters?
  10. How will you promote your product or service?
  11. Why will customers buy from you rather than the competition?
  12. How would you describe the competition?
  13. How will the competition react once you start business?
  14. Do you have the right licenses and permits to operate your business?
  15. Who have you consulted in preparation for your business?
  16. Have you estimated your monthly expenses?
  17. Have you estimated your startup costs?
  18. Where are you getting your finance?
  19. Have you ever borrowed money before?
  20. What have you done to prepare for business?

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TRANSCRIPT: BONUS EPISODE 13

Title: How to Turn Your Idea Into a Multi-Million Dollar Business (Chapter 8)

Date Published: December 11, 2015

Running Time: 14:31 minutes

Hi, this is John Millar. I’m the Naked Business Coach, stripping business back to its bare basics. As a special bonus, we’re giving you a free copy of all the chapters in How to Turn Your Idea into a Multi-Million Dollar Business.

Now this is available in Amazon and you can buy a copy in hard copy or kindle version. But before it gets released to iTunes and to Audible, I thought I’d give it to you as a free trial. I hope you enjoy it, took me some years to write. And I hope you look forward to some of the other things that we’ve got that you’re going to get absolutely free.

Thanks so much and welcome to The Naked Business Coach Podcasting Channel.

The Entrepreneur’s Guide Series

How to Turn Your Idea into a Multi-Million Dollar Business (And Avoid the Mistakes that Send Most Business Owners into Bankruptcy)

By John Millar

Chapter 8: Self-Assessment Checklist

Welcome to the self-assessment section, which will help you understand whether or not you have paid attention throughout this book. It will also give you a moment to reflect. In addition, this self-assessment quiz will help you evaluate your suitability to run your own business. At the end, have a close look at your answers and the responses you provided. The more honest you are in your answers, the more useful and relevant the information will be. When you are finished, you can use your responses to:

1) Judge if you are suitable for business

2) Identify your strengths and weaknesses

  1. Why are you thinking of going into business?

People go into business for many reasons. Unfortu­nately, many start-ups are not successful and this can often be attributed to people going into business for the wrong reasons. Here are some typical answers:

  • I need a job
  • I don’t like my current job
  • I want to be my own boss
  • I’ve always dreamt of working for myself
  • I want a better lifestyle
  • I want to be rich
  • For family reasons
  • I am not sure
  1. Have you discussed starting a business with your family?

Many small business owners rely heavily on family support because of the time, money, and commitment demands. Working long hours with few, if any, holidays can strain family relationships. While not essential, family support may help you during difficult times and when you are heavily involved with the business. Here are some typical answers to this question:

  • I have not discussed going into business with my family
  • My family has no interest in the business
  • My family could be described as lukewarm on the idea
  • My family is very supportive
  1. How would you describe your industry experience?

Relevant industry experience provides you with an un­derstanding of the particular nuances of industry suppliers, customers, competition, key challenges, and potential pitfalls. Some say it is easier to get experience while working for someone else compared to “paying for your own mistakes” when you work for yourself. Talk to as many people as possible in the industry to realistically and objectively assess the viability of your proposed business. Here are some typical answers to this question:

  • I have never worked in the industry
  • I have recently started in the industry
  • I have worked in a similar industry
  • I have been working in the industry and consider myself an expert in this field
  • It is all new to me, but I am keen to give it a go
  1. What business management skills and experience do you have?

Business management skills and experiences provide a good background for operating a small business. If you lack skills in any areas of management, you may struggle to maintain the business at a high standard. It may be necessary for you to develop your business skills prior to starting your own business. Consider how you could either develop or gain access to the skills you lack through further coaching, training, contracting, or forming a partnership with someone who has the skills you require. Here are some typical answers to this question:

  • People
  • Finance
  • Marketing
  • Administration
  • Customer service
  • Production
  • Distribution
  • Planning
  • Research
  • Selling
  • None of the above
  1. What does your past coaching or training include?

Coaching and or training provides many benefits to small business owners. It can give you the confidence, knowledge, and ability to effectively plan and manage day-to-day business operations. Here are some typical answers to this question:

  • I have had no formal coaching or training
  • I have taken a few short courses
  • I have undergone extensive managerial training and executive coaching
  1. Why have you chosen this business and this industry?

Starting your own business involves a significant investment of time and resources. Therefore, it is important to ensure that the type of business you choose is a viable and profitable option in an appropriate industry. Here are some typical answers to this question:

  • I have a great idea that will make me rich
  • I have identified an opportunity in the market
  • I can afford to start the business
  • It looks easy to operate
  • I am unsure
  1. Have you prepared a business plan?

Preparing a business plan allows you to develop your un­derstanding of your business by working through a number of important issues including marketing, finances, management, and legal requirements. Here are some typical answers to this question:

  • Yes
  • Yes, but it’s incomplete
  • No, but I am considering doing one
  • No
  • What is a business plan?
  1. What do you see as the biggest obstacles in your business?

As a business owner, you will encounter any number of obstacles to work through and solve in order to be successful. The better your understanding of the potential problems, the more equipped you will be to deal with them as they arise. Here are some typical answers to this question:

  • Setting up the business
  • Developing a business plan
  • Lack of management skills
  • Finding customers
  • Selling
  • Finding suppliers
  • Operational issues
  • Finding help from a business coach, accountants, and other key advisors
  • Finance
  • Time
  • Personal issues
  • Employees
  • There are none
  • I cannot think of any at this stage
  1. Can you accurately describe your targeted customers in terms of age, demographics, behaviors, and other parameters?

A business needs to have a good understanding of its customer base. A thorough understanding of the various types of customers you will target, along with their behaviors, will give you an advantage when it comes to utilizing your marketing strategies. Here are some typical answers to this question:

  • Yes, in great detail
  • Somewhat
  • No
  • Everyone is my customer
  • I don’t know how to identify my customers
  1. How will you promote your product or service?

Promotion involves making people aware of your product or service and then in some way encouraging them to buy it. There are many ways to promote your products using methods such as advertising, giveaways, packaging, event sponsorship, discounts, and coupons, or on a website. Here are some typical answers to this question:

  • I am unsure of what to do
  • I am still considering the options
  • I have defined a strategy to target potential customers
  • I don’t know anything about promotion
  1. Why will customers buy from you rather than the competition?

 For your business to become profitable, you will need to convince customers that you have something to offer that is better than what they can get elsewhere. There needs to be a sufficient reason for them to purchase from your business rather than from your competition. Here are some typical answers to this question:

  • Price
  • Service
  • Quality
  • Reputation
  • Improved product
  • Uniqueness
  • Not sure
  1. How would you describe the competition?

Understanding your competition will be important if you are to effectively compete with them in the marketplace. You should be able to describe their strengths and weaknesses and develop strategies to compete and capitalize on these points. Here are some typical answers to this question:

  • It is a very competitive market with many suppliers and a lot of pressure on prices
  • It is a competitive market with a few competitors but still some opportunities are available
  • There are few, if any, direct competitors
  • There are no competitors and my product/service is unique
  • I have not assessed the competition
  1. How will the competition react once you start business?

 Prior to going into business, you should form a projection of how your competitors will respond when you enter the market. Your competitors will likely implement strategies to protect their market share, therefore making it difficult for you to establish your business. Here are some typical answers to this question:

  • They will do nothing
  • They will observe and monitor my actions
  • They will advertise more aggressively
  • They will improve their service
  • They will start a price war
  • I am unsure how they will react
  1. Do you have the right licenses and permits to operate your business?

 To operate a business, you are required by law to have a number of licenses and permits. Your requirements will depend on what type of business you plan to operate, its size and location, and the industry you belong to. Here are some typical answers to this question:

  • Yes
  • No
  • I am unsure of the requirements
  1. Who have you consulted in preparation for your business?

 There are many factors to consider before opening your own business. Nobody can be an expert on all of them, so you should think about seeking some external and independent advice during the planning stages. Some extra time and resources spent seeking advice could save you a lot of trouble later on. Here are some typical answers to this question:

  • Accountant
  • Business coach
  • Solicitor
  • Attorney
  • Financial institution
  • Insurance company
  • Chamber of Commerce (America)
  • Department of State and Regional Development
  • Business Enterprise Center (Australia)
  • Australian Securities and Investments Commission (Australia)
  • Australian Tax Office (Australia)
  • Office of Fair Trading
  • Australian Chamber of Commerce and Industry (Australia)
  • National Federation of Independent Business (America)
  • Industry Association
  • Intellectual Property Australia (Australia)
  • None
  1. Have you estimated your monthly expenses?

You should be aware of all of the possible expenses your business may incur during each month of operation. Before you can begin operations, you must ensure that you can meet these expenses while still making a profit in the long-term. Here are some typical answers to this question:

  • Yes, I have developed a cash flow budget
  • Yes
  • Yes, but not completely
  • No
  1. Have you estimated your startup costs?

Startup costs can become substantial very quickly and are often greater than business owners anticipate. Having a thorough and realistic estimation of your startup costs, along with following a budget, will help you avoid this situation.

  • Yes, I have a budget
  • Yes, I am in the process of doing that
  • No
  1. Where are you getting your finance?

Depending on your business proposition, you may need very little or a substantial amount of finance to get yourself into a profit-earning position. Therefore, you need to consider how much finance you need, within what time frame, and where you will access it from. Here are some typical answers to this question:

  • I am using my own money
  • From credit cards
  • A personal loan or house mortgage
  • My friends and family
  • I work part or full-time
  • I haven’t thought about it yet
  • I don’t know
  • I can’t get finance
  1. Have you ever borrowed money before?

You may or may not need to borrow money to fund the startup phase of your business. Either way, you should consider your options now as you can’t be certain that you won’t be required to in the future. Your ability to borrow money provides extra security should you need to address any cash flow or unexpected expenses you may encounter in the future. Here are some typical answers to this question:

  • Yes
  • No
  • I don’t need to borrow money
  1. What have you done to prepare for business?

Being well prepared for business will give you the best opportunity for success. While having a good business and product idea is vital to your success, you are unlikely to fare very well in a competitive market if you are unprepared. Here are some typical answers to this question:

  • Talked to friends and family
  • Attended training seminars
  • Engaged a business coach and accountant
  • Visited a business center
  • Researched on the internet
  • Talked to people in business
  • I have previously worked for myself
  • Nothing

 

John Millar

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