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It can be a cold, harsh world out there--especially ifyou're just starting out in business. Luckily,business incubators can provide you with shelter from thestorms of unfamiliarity.
Assistance programs established to help get your businessoff the ground, incubators nurture your company duringits infancy--when it's most vulnerable to the perils of thestart-up process. In addition to management advice, access tofinancing, technical and business support, and other services,incubators offer affordable rental rates for work space.
Incubators boast impressive success ratios: According to arecent study by the National Business Incubation Association(NBIA), an estimated 87 percent of companies that graduated fromincubators since the 1970s are still in business. In addition,these companies report an average sales increase of more than 400percent from the time they enter the incubators until theyleave.
"Business incubation goes a long way toward taking thefear and loneliness out of your business," says Dinah Adkins,the NBIA's executive director. "[It] provides invaluableservices to fledgling companies to ensure their success."
A small number of "niche incubators" also exist, whichcater to new companies in specific industries, such as software orarts and crafts, as well as businesses run by women andminorities.
Because of its popularity, incubator tenancy is not offered tojust any new business seeking assistance; most incubators have astringent application process and even requireprospective tenants to present a formal business plan.But once accepted, many businesses aren't quick to leave:On average, companies stay in incubators two tothree years.
For a listing of incubators in your state, e-mail inclist@nbia.org or send aself-addressed, stamped envelope to National Business IncubationAssociation, 20 E. Circle Dr., #190, Athens, OH 45701.
Lesson Plan
We all make mistakes. Here's how to learn fromyours.
Even the most successful business owners make mistakes.That's how they learn and grow. But what if you're juststarting out in business and haven't had the chance to err yet?Never fear: You can learn about business blunders--and avoid makingthem yourself--by studying the mistakes of others.
Richard Z. Gooding, Ph.D., a strategic planning consultant inPhoenix who wanted to identify which pitfalls posed the greatestthreats to new businesses, asked a group of 40 senior executives in1995, "Why do new products or services fail?"
The skeletons in their collective corporate closetrevealed that companies large and small suffer from many of thesame ailments. Timing, they said, is crucial--especially whenintroducing a new product or service, because entering a saturatedmarket can be as disastrous as entering the market too early.
Other problems responsible for failed business venturesinclude miscalculating market size, underestimating costs, failingto differentiate a product or service from its competition,overestimating sales volume and undercapitalization.
But the biggest problem, says Gooding, is not understanding thecustomer. "People have great business ideas all the time butdon't consider what their customers' needs might be,"he says. "But by going out and talking to customers, you canfind out what they really need and what their problems are--andthen you can find a solution to them."
To help new small-business owners identify and anticipateproblems, Gooding has published a booklet called But What CouldPossibly Go Wrong? that lists 56 of the most common reasonsbusinesses fail. For a free copy, send a self-addressed, stampedenvelope and your business card to Strategic Advantage Inc., 4321E. Woodland Dr., Phoenix, AZ 85044.
Contact Source
Strategic Advantage Inc., (602) 759-7562
