I love growing food and drink businesses and the idea of growing one excites lots of other people too. Here’s the thing though you have a great idea, you love what you’re making, your friends and family think it’s awesome. So you say to yourself, “right, let’s do this.” You buy all the materials, make a whole lot of things, then wonder now what. Or maybe you go to the market, set up a stall, make it look really pretty and then hope for the best. Well, I’m here to tell you hope is not a strategy.
I see too many people, too many times go from feeling on top of the world to down in the dumps very quickly because their little idea that had traction suddenly stopped working or just did not make the money that it needed to, to sustain them to quit their day job.
So how do the bigger brands get big?
How can you keep your head above water whilst following your heart?
What are the things you should know before you start?
I’m sharing with you what I’ve seen so many times over since working with many, and I mean many, people following their heart into the amazing but often challenging world of food and drink.
1. Stretch your boundaries
Friends and family are a good place to start to test your products, but they cannot be the only ones. The people closest to you are kind of meant to “play nice” with you so you just cannot rely on their feedback. They want to see you succeed but you need to test your product with your prospective buyer. At the start-up stage no doubt you will have some idea who will buy your product. Even if you haven’t done a customer avatar yet, you should know who you are targeting. So make sure you talk to them directly, say via social media or by sending out a questionnaire to your email list. It’s important to develop your product in line with what they want, but remember, sometimes people don’t know what they want until it is presented to them. It’s a little bit of art and a little bit of science at this point.
2. Set yourself up correctly from the get-go
At the early stages of any business, most people are extremely excited to be making something that they love and delight in but they forget to look after the back office. I call this the governance of a business. Things to think about to make sure you are protected and acting on the right side of the law include getting the right insurance(s), permits and accreditation from your local food authority, business registration, understanding what taxes you need to pay, setting up employee benefits (if you have any staff at this stage) and trademark your intellectual property. For many, these are the boring bits about building a business, and they can suck a lot of money too, but mostly, once they’re done, they are set and forget.
3. Think bigger
I don’t want to be sexist I don’t, but I see so many women play small. It crushes me. Local is lovely but being parochial is not. Sure we all need to start somewhere and testing your idea in a local market is a very good move in the early stages. But just how big do you want to go? Are you building a “make at home” hobby or do you really want to build, grow, and scale a business? The two seem the same at first but in fact, they’re very different. My passion is for growing businesses, not hobbies. In Females in Food, I’m coaching women who have “a-ha” moments when they realize how small they’ve been playing. The key to playing a bigger game is to take care of your mindset, have a scalable model, and being very, very clear on what your vision is. Then go for it! Because if it isn’t you to build this idea, then who is better suited? No one. #backyourself. It’s yours for the taking.
4. Money does not grow on trees
It may come as a surprise to you but money does not magically appear in your bank account. I know, I’m crazy but I’m here to tell you it just doesn’t. What’s required is a good nest egg to start, a problem to solve that others actually care to have solved, some skill to make it happen and a whole lot of tenacity. I’m afraid passion alone will not cut the mustard in terms of bringing in the cash. I know crazy, right? For many, they keep their day job until they have proven their minimal viable product. For others, they quit their day job once they’ve squirreled away enough savings to keep them afloat during the start-up phase. To give you an idea on how much you will need to save, start by looking at what your expenses are over the year and project what kind of expenses you’ll have to launch your business. In other words, do a budget and a cash flow forecast. They may sound dry and dull but they’ll be your saving grace once you start, trust me and thank me later.
5. Know where you’re going
Ever packed a bag and just taken off for the weekend? How good does it feel until you get home and find out you missed the #1 thing to do in that town because you didn’t have a plan. Felt good at the time but in hindsight was a waste of your precious resources – time and money. Starting a business without a plan is precisely the same thing. A business plan does not have to be a big tome written on wads of paper. What it needs to be is a one-page framework on what you are selling, who you want to sell it to, where they can buy it and why you are doing it. Simply look at it this way: what your product development plan is, who you want to sell it to is the beginnings of your marketing plan, where they can buy it is your sales plan, and why you are doing it is part vision and part “about” section on your website! See, all beginning to come together for you now.
6. It should not be the best-kept secret
There’s one skillset to make a product and then there’s another to market it so people know what amazingly delicious things you’ve created. But don’t let me frighten you into thinking there’s some ultra-secret sauce that you only learn as part of an MBA. It’s just not true. I’m going to give you a few key things you need to know and must do to not be the best-kept secret. Firstly, who is your ideal customer? Get to know them intimately. No, I don’t literally mean intimately but I do mean you need to be able to articulate clearly and concisely who you are talking to, their likes and dislikes, and where they hang out. Secondly, don’t be all things to all people. When you “talk” to everyone, you’re talking to no one so get comfortable being very niche and saying thanks but no thanks. And lastly, be consistent. Brands are not built overnight, they are built over time with consistent action taking, this may mean you should not be on all the social channels, it may mean just doing one extraordinarily well rather than two or more moderately well.
7. Don’t be a heroine
It’s nice to be considered a trailblazer or a unicorn (in entrepreneurial terms that is) but for goodness sake, don’t let your pride get in the way of asking for some help. Launching a business is tough yakka, trust me I should know. I’ve built more than three businesses of my own and countless others for other people. Get a support network. Find a group of people who are supportive and put them on speed dial (yes you could actually call them!) and tap into their advice and expertise. Why would you have your girlfriends saved in your ‘Favourites’ for personal matters but no one there to catch you when you’re probably taking the biggest risk of your life? It just doesn’t make sense. And remember, it doesn’t need to be your girlfriends, in fact sometimes they mean well but honestly have no idea what you’re going through – get involved with a supportive community who understands the industry and has a proven track record of backing winners.
And that’s a wrap, my 7 things you must know before launching your food or drink business. Are they hard? Nope. Are they overlooked by many? Yes. So what I suggest you do now is write this list down on a piece of paper and then answer for your own business. And when you work on those, you’ll have built yourself a very nice starting block for successful food and drink business, I promise you, you’ll be at least 50% ahead of others trying to launch.
Written by our contributor Chelsea Ford, an award-winning entrepreneur and a highly regarded women’s advocate and business champion. Chelsea is also the founder of the powerful and purposeful community platform, Females in Food and online course, Foodpreneurs Success Formula™. You can follow Females in Food on Facebook and Instagram. Become our contributor too! Apply here.
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