Forbes recently published an article, by Brett Nelson, regarding essential questions that entrepreneurs need to ask regarding the operation of their businesses. In it he notes that:
“Companies fail for a host of reasons. Bad luck plays a role, sure, but disaster usually strikes because of a more fundamental flaw--in the original idea, the strategy, the execution or all of the above.
When it comes to building a business, even Warren Buffett would agree that no one can spot every opportunity or anticipate every threat. There are simply too many variables. And in an increasingly competitive global economy, those variables are changing faster than ever before.
What entrepreneurs can do is ask the core set of tough questions that govern the fate of any enterprise. Armed with those answers, they stand the best chance of beating some fairly dire odds: Studies estimate that just two-thirds of all start-ups survive the first two years, and less than half make it to the fourth.
Make no mistake: Digging for those answers is a grueling exercise--one that takes serious intellectual and emotional honesty. With any hope, the process begins long before money's been spent, products are built and customers are lost.
The real challenge, though, is to keep digging as the business grows. New opportunities and threats emerge, and yesterday's answers may not--and probably won't--suffice. Relentlessly asking the tough questions is how behemoths like Wal-Mart (nyse: WMT - news - people ), Microsoft (nasdaq: MSFT - news - people ) and General Electric (nyse: GE - news - people ) stay on top.
With that in mind, we present the 20 most important questions entrepreneurs need to answer--and keep answering--to build their businesses. Some highlights:
1. What is your value proposition?
2. Does your product address a viable market?
3. What differentiates your product from competitors'?
4. How big is the threat of new entrants?
5. How much start-up capital do you need?
6. How much cash do you need to survive the early years?
7. How will you finance the business?
8. What are your strengths?
9. What are your weaknesses?
10. How much power do your suppliers have?
11. How much power do your buyers have?
12. How should you sell your product?
13. How should you market your product?
14. Does the business scale?
15. What are your financial projections?
16. What price will consumers pay?
17. How do you protect your intellectual property?
18. How do you keep the help happy?
19. How committed are you to making this happen?
20. What is your end game?”
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