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Fear of failure is holding me back

Discussion in 'General Business Forum' started by Digimem, Mar 5, 2018.

  1. Digimem

    Digimem UKBF Contributor Free Member

    97 3
    Hey guys. I hope some of you remember me.

    If not, I'm the guy who wants to make it big by selling specialists ink types used by printing companies.

    My "USP" is providing a free same day service for the area of Greater Manchester (which comes in handy in the event of a toner failure, unforeseen urgent customer etc)

    I have budgeted £20,000 (own money - basically everything I have) to get started up with a website, branding, marketing and minimal start up stock.

    I know my potential customers need/use these products and I should be able to match my national big competitors in price..

    BUT I'm terrified of failing. I'm risking all my money and I don't know what I would do if I lost it all.

    Any help or advice please?

    Thanks
     
    Posted: Mar 5, 2018 By: Digimem Member since: Apr 20, 2017
    #1
  2. Mr D

    Mr D UKBF Legend Free Member

    9,034 911
    Accept that you will fail at times.
    Some of the greatest people in history failed many times. And achieved a lot because they carried on. Along the way coming up with thousands of ways not to do things.

    Its possible that before you have the perfect business you have an imperfect business. Perhaps even imperfect business, slightly less imperfect business, improving business and better business. First. One after the other. :)

    You may well get turned down by lots of people. If you are doing things right then some will say yes. Whether you will recoup your investment is down to what you do and how you do it.
    Its possible, change that to probable, then change to certainty.

    Losing it all is not the end of the world. Not pleasant, not by a long shot. But if you do then you can rise again. Armed with knowing what not to do the same.
     
    Posted: Mar 5, 2018 By: Mr D Member since: Feb 12, 2017
    #2
  3. fisicx

    fisicx It's Major Clanger! Staff Member

    29,066 8,575
    Is there sufficient need for your service?

    How many potential customers need same day delivery?

    If most manage just fine with their normal suppliers doing next day delivery then will there be enough business to pay back your investment?
     
    Posted: Mar 6, 2018 By: fisicx Member since: Sep 12, 2006
    #3
  4. Ashley_Price

    Ashley_Price UKBF Legend Full Member - Verified Business

    6,988 1,286
    I think you need to do some market research before finally taking the plunge, just as @fisicx says.

    To give yourself the best chance of succeeding, it will be good to find out as much information as you can.

    Yes, they use these products, but how often are they likely to need same-day delivery? Have you been round several firms and asked them? And even if they say it is a service they are interested in, take what they say with a pinch of salt. I am sure every person running a business has had people "promise" to use them or place orders, only for that to never materialise.

    But another thing you have to consider is the area you are offering to deliver to "same day". Google and Wikipedia both state that the Greater Manchester area is 493 square miles. So, you need to have a deadline for orders to come in, for you to be able to deliver that day and make it worthwhile. There's no point delivering inks at 4:30pm for a job, which is going to take three hours to print and needs to be out of the door at 5pm). What happens if you are in one part of the city at 10am and your next delivery is the other side of the city but you get caught up in delays?

    I used to run an office supplies business, and only very rarely did we get asked if we did same day delivery (we didn't). However, the previous owner of the business did do same day delivery on basic stationery items, and she ran herself into the ground with trying to deal with everything and deliver orders on time and that was only in a 30 miles radius of her office.

    I am not saying you won't succeed, I am saying you need to crunch the numbers and get someone objective to look everything over as well, before you go ahead.
     
    Last edited: Mar 6, 2018
    Posted: Mar 6, 2018 By: Ashley_Price Member since: Feb 9, 2008
    #4
  5. Toby Willows

    Toby Willows UKBF Regular Free Member

    759 164
    Don’t gamble what you can’t afford to lose. Starting a business is a gamble.

    I don’t think you have a usp. I’ve been in 1,000’s of offices (not exaggerating either) and not one didn’t have a cupboard filled with toner/ink that was replenished long before they were even close to running out.
     
    Posted: Mar 6, 2018 By: Toby Willows Member since: Jun 20, 2016
    #5
  6. Socio South West

    Socio South West UKBF Enthusiast Free Member

    741 183
    It looks a very narrow field and you are right to be cautious.
    I see several potential pitfalls...
    - How many printers let their ink stock drop to the level that they need urgent deliveries? (ie quicker than overnight)
    - Whilst there are doubtless good numbers of printers in and around Greater Manchester, how do you contact them all and make sure they are aware of you and what you offer?
    - Cost of delivery - how do you keep that down to compete with an overnight carrier? As @Ashley_Price says. you are covering nearly 500 square miles, and careful costing and system development for your deliveries would be a must.
    - Stock holding.... different colours, viscosities, makes... how much stock would you have to hold for a relatively narrow field to offer the service you suggest.... and PLEASE don't say that you could get it overnight......

    And more.....

    It appears to me that unless you have a number of good contacts in the printing trade, you would be well advised to look at a broader product portfolio and hence customer base, and offer the service you suggest as a bolt on to that wider business.
     
    Posted: Mar 6, 2018 By: Socio South West Member since: Mar 24, 2013
    #6
  7. Ashley_Price

    Ashley_Price UKBF Legend Full Member - Verified Business

    6,988 1,286
    Even then you can expect only about a third, or possibly less, to start using you.

    When I bought the office supplies business from the previous owner, obviously the first thing I did was contact everyone I knew that had a business and offered to do a quote on their office products. Note that: it wasn't wanting them to buy from me immediately, I just wanted to do a quote.

    Only about a half took up the offer and even though, in many cases, I could show I was cheaper than their current supplier, only about a third started buying from me.

    This is why I said in my previous post you have to take what people say with a pinch of salt. Of course they will all be supporting your business... until they actually have to spend money.
     
    Posted: Mar 6, 2018 By: Ashley_Price Member since: Feb 9, 2008
    #7
  8. Toby Willows

    Toby Willows UKBF Regular Free Member

    759 164
    And this is a excellent example of just why people won’t change suppliers on price alone.
     
    Posted: Mar 6, 2018 By: Toby Willows Member since: Jun 20, 2016
    #8
  9. Ashley_Price

    Ashley_Price UKBF Legend Full Member - Verified Business

    6,988 1,286
    Completely agree... but my point was just because people are your "friends" doesn't mean they will buy from you. You still have to show them the value of your service - and value doesn't necessarily mean lowest price.
     
    Posted: Mar 6, 2018 By: Ashley_Price Member since: Feb 9, 2008
    #9
  10. Gecko001

    Gecko001 UKBF Enthusiast Free Member

    2,657 410
    I think the OP is right to worry as it seems that he is spending most of his start-up money on marketing and not much on providing the service. If same day service is his USP, I would have thought he would need to carry quite a bit of stock - more than his competitors who do not offer a same day service.
     
    Posted: Mar 6, 2018 By: Gecko001 Member since: Apr 21, 2011
    #10
  11. Ashley_Price

    Ashley_Price UKBF Legend Full Member - Verified Business

    6,988 1,286
    Completely agree. He is going to have to research what inks, etc., the printers and so on use, so that he keeps the right ones in stock at all times. You can't offer a same day service without the stock, and that is going to mean a lot of money tied up in products sitting in his warehouse or wherever.

    It is one of the reasons why, when I bought the office supplies business, I stopped the same day delivery, so I didn't have to hold any stock (the other major reason being that I don't drive).

    Unless you have a quick turnaround that is money just sitting there, and depending on the life of the product they could end up with wastage.
     
    Posted: Mar 6, 2018 By: Ashley_Price Member since: Feb 9, 2008
    #11
  12. Digimem

    Digimem UKBF Contributor Free Member

    97 3
    Thank you all for the replies

    Usually the smaller print companies will benefit from same day, because due to the price of these inks they don't keep many in stock. I'm hoping that I can entice those companies to use me their standard delivery stock also, if they know we have a same day option.

    My market knowledge comes from working for a national competitor. Yes there certainly is a need for a same day service, buts its difficult to predict how often they will need it. I know delivering is an onerous task, but I think I can get some temporary free help from a friend. If things kick off then I might look at hiring a part time driver.

    The ink I intend to sell are specialist. They would only be used by printers. I know for a fact that some smaller businesses don't keep any in stock. A medium size company might keep minimal amounts (but sometimes one unexpected run will require more than they have).

     
    Posted: Mar 6, 2018 By: Digimem Member since: Apr 20, 2017
    #12
  13. Ashley_Price

    Ashley_Price UKBF Legend Full Member - Verified Business

    6,988 1,286
    You will need to look into the legalities of this. It might be "free" as in you don't have to pay them, but you will probably still need to get insurance for their vehicle (as they own personal insurance won't cover them if they have an accident while delivering on your behalf) and they will need to be covered by public liability etc.

    One more quick question, what happens if you can't deliver same day for some reason (you are ill, want a holiday, etc.)?

    Don't think we are trying to put you off, but you have said yourself you fear this might be a failure, so it's useful to know and understand all the possible pitfalls ahead of deciding to do it.
     
    Posted: Mar 6, 2018 By: Ashley_Price Member since: Feb 9, 2008
    #13
  14. Chris Ashdown

    Chris Ashdown UKBF Legend Free Member

    9,533 1,923
    A motor Bike or scooter would be the best and lowest cost of transport

    Professional companies will most likely want genuine inks rather than the cheaper refills

    They might see the benefit or rather use you for the emergency job , but still likely to use original supplier unless you have a unique benefit for them the rest of the time

    What everyone is saying is make a well thought out business plan and cashflow forecast, with plenty of research, go out , speak to the MD's and get a good proportion to guarantee they will use you, be blunt, you are a new company , this is your aim, if you don't want to try me I would rather you say no now

    Will you expand to other supplies like paper and office supplies to keep turnover ticking over
     
    Posted: Mar 6, 2018 By: Chris Ashdown Member since: Dec 7, 2003
    #14
  15. Digimem

    Digimem UKBF Contributor Free Member

    97 3
    This was my original idea, but I would have needed a lot more money.

    What other things show good value?

    Breif break down of the 20k is as follows
    - 14k stock
    - 2k website
    - 2k marketing
    - 2k first 3 months overheads

    That's exactly why I posted this thread.

    I don't plan on being away from the business. If I'm sick (one or two days) I should be able to arrange some cover. In case of unforseen longer absence, I'm not really sure if I'm honest. Something to think about.
     
    Posted: Mar 6, 2018 By: Digimem Member since: Apr 20, 2017
    #15
  16. Toby Willows

    Toby Willows UKBF Regular Free Member

    759 164
    That looks suspiciously like “finger in the air and produce figures which fit your budget”. You need to do a lot more research on costings, especially marketing.
     
    Posted: Mar 6, 2018 By: Toby Willows Member since: Jun 20, 2016
    #16
  17. Digimem

    Digimem UKBF Contributor Free Member

    97 3
    The marketing will include:
    - Ad words
    - SEO help
    - one advert in a trade magazine
    - introduction email or letter
     
    Posted: Mar 6, 2018 By: Digimem Member since: Apr 20, 2017
    #17
  18. fisicx

    fisicx It's Major Clanger! Staff Member

    29,066 8,575
    Have you researched to see is there is enough of a need for this service to sustain your business?

    If you only get a couple of orders a week then it's just not viable.

    What happens if you get the call at 2pm on a Sunday when you've just finished a bottle of red?

    In any case, I suspect your marketing will come to naught. 2K is nothing at all. I'd put money on your competitors spending that each month. And when they see what you are doing some of them will also offer a same day service.
     
    Posted: Mar 6, 2018 By: fisicx Member since: Sep 12, 2006
    #18
  19. Mark Halsall

    Mark Halsall UKBF Newcomer Free Member

    11 1
    You mentioned earlier that most suppliers don't carry stock in the inks you intend to. If that is the case, then just having a good range of specialist stock available via next-day courier could be a stronger USP than same day delivery. Also, focusing on your core business could well be a better use of your time than running around doing same day deliveries.

    To mitigate some of the risk of failure in my current e-commerce business, I carried on working part-time for a few months to cover my bills. It was a tough juggling act, but I could sleep soundly at night knowing my kids would be fed and housed until the business was viable.
     
    Posted: Mar 6, 2018 By: Mark Halsall Member since: Mar 6, 2018
    #19
  20. Mr D

    Mr D UKBF Legend Free Member

    9,034 911
    Just out of interest, could different pricing work?
    Same day delivery £x+5, next day delivery £x?
     
    Posted: Mar 6, 2018 By: Mr D Member since: Feb 12, 2017
    #20