Your Business Risk Calculator

Hey there.  I hope you’ve been getting something from my posts thus far.

Today I was talking about some marketing concepts with a client.  He was very against the idea of a marketing project, and about “putting himself out there”.  It took me about 30 minutes on the phone, digging deeper and deeper with each questions, to get to the real core of the matter.

He was afraid.

Doing something new can be dangerous.  Putting yourself out there can be dangerous.  Owning a business in-and-of-itself is dangerous.  It’s all about taking calculated risks.  Measuring out your risk to reward ratio.  There are a lot of things that you can do as a business owner to maximize your reward and minimize your risk before you take action.  Let’s take a look at a few.

Numero Uno:  Do your homework first.  You can’t just jump into a major business decision.  If you have a new idea or direction for your company, start by doing some poking around online to see who else is doing it.  No market there?  Could be a red flag. Could also be a great opportunity if you already have a list of people that could benefit from your offering and who actually want your offering.  It’s important to find out if there is a demand for your product, service or whatever before you jump in.  Remember- just because you think it’s a great idea doesn’t mean anyone else will buy it. (harsh but its’ reality)

Number Two:  Look at the benefit of what you are thinking of doing.  Is it keeping with what you are doing now or is it way off in left field somewhere?  Is it congruous with your vision?  Are you just doing it because you think it will make a quick buck or because you are truly passionate?  Remember why you got into business in the first place.  If your like the entrepreneurs I hang with, you are passionate as hell about what you do, and whatever this new thing is needs to come out of you with the same fire.

Number Three:  Do you have the time, energy, money and other resources needed to get it done.  You have to consider these factors before you jump in.  Unforeseen things will pop up, you can’t prepare for them all, but you can get a ballpark of the necessary resources need to put it off.

Just remember, with little risk, comes little reward.  When the Wright brother’s jumped in their makeshift airplane on the Outer Banks of North Carolina in 1903, they took a risk, a calculated risk, and changed aviation forever.  They didn’t just take their plane off a cliff though, they did test and test and built up to that first flight (which was only 12 seconds long).  You will be much more likely to succeed if you follow their model of success for your business.