Product recalls can cost a company millions of dollars, and liability suits resulting from harm to consumers can rack up millions more in settlements. So, what’s a business owner to do? Answer: Avoid these situations. Take the following measures to minimize problems with your products and steer clear of recalls and lawsuits.
Check the details. What are the industry code standards for your product? Be sure to examine every aspect, including color, texture, and size. Ensure your product’s specs meet the exact requirements for production.
Check with suppliers. Will your products include parts or materials from suppliers? Most do. If so, make sure the supplier will be able to provide exactly what you need. Create formal legal agreements. Include expectations of the supplier and consequences if these are not met. Conduct quality audits of plants that are supplying your materials.
Check quality control. It’s essential to have a quality control system in place. Inspect materials to ensure they’re up to par. If you’re handling a high volume of product, you may need a sampling plan as part of this system.
Check your system. Conduct a mock recall once a year. This will ensure your quality control system works. Tracing your products verifies that communication channels and distribution systems are functioning properly.
Does anything sound better than being your own boss? Well, maybe a brand new sports car or free ice cream for life. But even a state-of-the-art fully-decked-out sports car will eventually need routine maintenance, and the taste of mint chocolate chip can get old after a while.
The same kinds of things can happen when you start your own business. There are many details to consider and seemingly endless tasks to keep organized after the initial excitement of being your own boss and keeping your own hours has faded. Circumstances are bound to arise that no one ever prepared you for!
Although this list is not exhaustive, here are 5 things to get you started when creating a business of your own:
1. Startup cost
The startup cost of your business depends heavily on the type of business you want to have. To estimate the startup cost, make a list of anything and everything you’ll need to finance in the first 6 months. Then take each expense and ask:
(Hint: Don’t forget to add a line item for those unplanned, miscellaneous expenses!)
“Find a need, and fill it” is general advice for starting a successful business. But if the need is apparent, how many other businesses will be going after the same space to fill? And how do you create a business that can compete? After all, keeping your doors open and your business frequented is priority #1.
The simplest and most effective solution? Be great at what you do. Take the time to learn your business and the need you’re trying to fill – inside and out. Take a step back and think like a customer. Try to imagine how your competitors are failing at meeting customers’ needs. What can you do to solve those issues? Overcoming these hurdles can’t guarantee that your doors will stay open, but your knowledge, talent, and work ethic can set you apart from competitors from the start. This is what builds life-long relationships with customers – the kind of customers that will follow you wherever your business goes.
(Hint: The cost of your product or service should not be the main differentiator from your competition.)
3. Customer acquisition
The key to acquiring customers goes back to the need you’re trying to fill by running your business. If the demand for your product is high, customer acquisition may be easier. And there are always methods to bring in more. First and foremost, be aware of your brand and what your business offers. This will make identifying your target audience more accurate. Then market to them with a varied strategy on multiple fronts: content, email, and social media; search engine optimization; effective copywriting; and the use of analytics.
(Hint: The amount of money you spend on marketing – e.g., Google & Facebook ads – is not as important as who you are targeting.)
4. Building product inventory
This step points directly back to your startup cost. At the beginning, do as much research as you can, then stock your literal (or virtual) shelves with a bit of everything feasible you think your target audience may want or need. Track which products (or services) customers are gravitating towards – what items in your inventory disappear the most quickly? What services in your repertoire are the most requested? After a few weeks or months you’ll have real data to analyse. Then always keep the bestsellers on hand, followed closely by seasonal offerings. And don’t forget to consider making a couple of out-of-the-ordinary offerings available, just in case. Don’t underestimate the power of trying new things from time to time; you never know what could turn into a success!
(Hint: Try to let go of what your favorite items or services might be, if customers are not biting.)
5. Compliance with legal standards
Depending on what type of business you’re in, there may be standards and regulations that you must adhere to. For example, hiring employees falls under the jurisdiction of the Department of Labor and Federal Employment Laws. There are also State Labor Laws to consider.
(Hint: Be absolutely sure to do your research on the legal matters that can arise when beginning your own business. Not many judges are very accepting of “But, Your Honor, I didn’t know that was illegal!”)
Starting your own business is not an impossible task, especially when you’re prepared. And what makes preparing yourself even easier are the business start-up tools available at WFGInsuranceQuotes.com.
The average U.S. household owes over $5,500 in credit card debt,¹ and the average Canadian household owes over $8,500 in consumer debt.²Often, we may not even realize how much that borrowed money is costing us. High interest debt (like credit cards) can slowly suck the life out of your budget.
The average APR for credit cards is over 16% in the U.S.³ and around 19% in Canada.⁴ Think about that for a second. If someone offered you a guaranteed investment that paid 16-19%, you’d probably walk over hot coals to sign the paperwork.
So here’s a mind-bender: Paying down that high interest debt isn’t the same as making a 16-19% return on an investment – it’s better.
Here’s why: A return on a standard investment is taxable, trimming as much as a third so the government can do whatever it is that governments do with the money. Paying down debt that has a 16% interest rate is like making a 20% return – or even higher – because the interest saved is after-tax money.
Like any investment, paying off high interest debt will take time to produce a meaningful return. Your “earnings” will seem low at first. They’ll seem low because they are low. Hang in there. Over time, as the balances go down and more cash is available every month, the benefit will become more apparent.
High Interest vs. Low Balance
We all want to pay off debt, even if we aren’t always vigilant about it. Debt irks us. We know someone is in our pockets. It’s tempting to pay off the small balances first because it’ll be faster to knock them out.
Granted, paying off small balances feels good – especially when it comes to making the last payment. However, the math favors going after the big fish first, the hungry plastic shark that is eating through your wallet, bank account, retirement savings, vacation plans, and everything else.⁵ In time, paying off high interest debt first will free up the money to pay off the small balances, too.
Summing It Up
High interest debt, usually credit cards, can cost you hundreds of dollars per year in interest – and that’s assuming you don’t buy anything else while you pay it off. Paying off your high interest debt first has the potential to save all of that money you’d end up paying in interest. And imagine how much better it might feel to pay off other debts or bolster your financial strategy with the money you save!
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