A client wanted my advice about his idea for a new business venture after he had just sold his company that honed precision machine tools. His new idea involved sharpening scissors for hairdressers. I told him I had no idea whether such a business could succeed, but I could show him what he needed to do to find out. I advised him to do the following:
• Find out who the competitors were and how their businesses operated. To do this, I advised him to examine periodicals and Web sites that were targeted specifically to hairdressers, looking for ads for sharpening scissors, and to perhaps attend a trade show or two for hairdressers.
Offer his services to hairdressers on a trial basis. He had already developed a portable machine he could take with him and sharpen scissors in a beauty shop. Much could be learned by actually taking the machine around to beauty shops and trying to sell his services. This research and trial set him on the road to a very successful business. From ads in trade periodicals he learned he had a number of competitors, but, clearly, there was a market for sharpening scissors for hairdressers. Nearly all of his potential competitors operated by mail order. Scissors were sent to them and returned one to two weeks later. By sending scissors himself to these companies for sharpening, he also learned that quality and turnaround time varied greatly.
From actually trying to sell his services, he learned that hairdressers were very receptive once they could be convinced he wouldn’t damage their scissors. Many had sent expensive scissors (professional scissors can easily cost $150 a pair) to a sharpening company only to have them unusable when returned. He solved this concern by offering on-the-spot replacement of any scissors that he damaged.
Finally, he learned that hairdressers love scissors. “Showing a group of hairdressers a display of professional scissors is like showing a group of kids a display of candy bars,” he told me. He decided to add scissor sales to his business and today runs a lucrative business with nearly 50 percent of his profits coming from sales rather than sharpening.
Similarly, I was once approached by a talented cabinetmaker who had a prototype for a new product: essentially, a wooden under-the-bed storage device. His concept was to sell it through unpainted furniture shops, which would then resell it to consumers. He was advised that he needed marketing research to determine whether the product could be successfully marketed this way, and he wanted to know what I would charge to do that research. I applauded his desire to limit his risk through up-front research, but I knew a better way than hiring me to ask questions and crunch numbers.
I advised him to spend a few hundred dollars printing business cards and order forms. Next, I suggested that he assemble a few more prototypes to demonstrate the device. Finally, I advised that he put the prototypes into his van (along with the cards, order forms, and a list of unpainted furniture stores) and spend a few days visiting several stores to pitch his product to them. Returning with a pile of orders would be a better indicator than any amount of academic market research. In fact, if he came back with no orders—even if not the outcome he hoped for—the exercise would still have been great research carried out inexpensively. This kind of direct approach—asking for and getting (or not getting) orders—adroitly bypasses a lot of academic research. It’s not only more accurate in a practical sense, but it’s cheaper and quicker. Professional researchers may scoff at this method, arguing that they can provide more comprehensive and scientifically valid data, but for the lifestyle entrepreneur, it is the most efficient and economical way to make the go or no-go decision. Seeking orders in advance isn’t always feasible. You can’t take orders in a restaurant until you have a kitchen, food, tables, chairs, and so on. In other cases though, there are no obstacles to taking orders in advance of making a major investment. Doing so is a great, low-risk way to test your business concept.
The bottom line is quite simple. Never lose sight of the reality that a business starts with a customer by getting overly caught up in research. Instead, put your initial efforts into figuring out what you need to do to get your first customer and then to get many more to follow that first one.


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