What i've learnt about starting a business

by Reiss Gunson on Wednesday, 28 March 2018 13:41

Dont buy anything in high volumes to chase lower unit costs; that is a game for established businesses

A good example is packaging and branded items.  Speaking for myself at least i find it incredibly tempting to order 1000 units of something to get the unit price down

But it is a mistake and a lesson ive had to learn more than once

When you are starting up there is one thing you want above all else; flexibility

Often you will not know in advance what is going to fly and what is going to flop, and speaking for myself i often wake up with a completely new idea and i want to implement it immediately; if youve got 2 years of stock of the item you want to change this really puts a damper on things

Sure, the unit cost is higher when you order low volumes but the total outlay is less and cash conservation is the name of the game as a start-up, at least if its your money on the table

If it doent work as well as you hoped you flog it off or put it in the bin and change tack

If youve bought a container load of widgets with an unbelievably low unit cost and they are non conforming or not well received by the market or you just want to take your business in a different direction you have a bit of a problem

Pilot studies rule.  Yes they have a cost, but it is the least expensive way to learn

Experiment every day, but never go all in until you've proven it works.


« A customer's thought for the day Why there is no substitute for large diameter burrs if you want to single dose »