What is crucial to know when starting a new business in emerging markets?

“Help, I’ve fallen and I can’t get up” is an amazing marketing tagline.  It’s been estimated that 95% of Americans have heard the tagline at least twice. That means that it has survived for years in a commercially televised world populated with products that come and go with great frequency.

The tagline is attached to sales of a device created to advise first responders that someone has been incapacitated in a fall, and is having difficulty returning to normal activities. It’s quite useful for those who live alone, or who might otherwise fall and injure themselves.  My hat is truly off to the underwriter.

Believe it or not, many of our consulting clients don’t use those words when they discuss challenges they are facing.  What they should tell us is that they have fallen and don’t know the way to navigate from where they find themselves to where they think they need to be.

For just a moment, let’s examine some of the challenges faced with starting a new business or existing businesses, and how those may differ significantly from the challenges faced with starting a new business in emerging markets.  Let’s examine how to not only assess these challenges, but hopefully, to move beyond them as well.

Starting and operating any type of a business is difficult, regardless of business, physical, or regulatory environment.  You may have started a business in a bricks and mortar setting, or the business may be active and functioning online, or in some type of blended environment.

Let’s think for just a moment about the various challenges one might face in starting and operating any business.

1. The owner may not be sure his or her idea is solid, time tested and true, and will be continually supported by customers.

2. The owner may be undercapitalized and unable to successfully market the business.

3. The owner may not be able to find competent employees or to train them adequately.

4. The owner may have underestimated the level of competition for sales.

5. The owner may have mistaken the amount of time required for the business to begin profitable operations.

6. The owner may not have the financial resources to fund all the equipment or preparation tools necessary to successfully operate the business.

On top of all of that, he or she may have not taken into account the amount of necessary marketing, or the length of time and marketing required to draw customers or clients into the business.   In other words, there’s a shortage of funds, a shortage of marketing and advertising dollars, or a challenge with personnel.  Welcome to the real world of business.

Business owners who develop in markets classified as emerging markets have even more challenges awaiting them—for several reasons.

1. Although designated as emerging, and seemingly counterintuitive, the business owner may find the level of competition faced is significantly higher because other business owners may have also recognized true opportunity in an emerging marketplace.

2. In a brick and mortar business, the ability to access raw materials or an inventory of items necessary for the successful operation of the business may be limited or severely restricted.  In an online business, technology challenges may limit sales ability by either limiting access or limiting visibility—two key issues to success of any online venture.

3. Knowledge of the product, goods, or services may be severely limited by the potential customer or client base.  The owner may find that an educational process—teaching the clients about the products or services– may be required to secure a customer base.

4. If the base of potential client users is limited, the frequency of use of the concept may be lower than would be otherwise experienced.

So how can one assure that starting a new business in emerging markets has the best upside for success?  We’ve developed a 5 point checklist to use in your development efforts.

1. If you are starting a business in an emerging market, develop a friend, trusted advisor, or Consultant who will act as another set of eyes and ears for your business.  You are going to be focused on your business, of course, but it’s quite easy to be blind to some readily recognizable pitfalls.  And you—operating close to the day to day business– may not see them.  It’s important that, as an owner, you have others around you—trusted individuals—to help the business steer clear of hapless obstacles.

2. Prior to starting your business, identify not only the negative elements which may be associated with the business, but also the positive elements.  Identification of the positive elements “pre-client attention” will allow focus on problem solving the more challenging elements and offer perspective that may not be possible once the business is up and operating.

3. Part of the startup of any business should be a pre-development meeting with an Attorney and an Accountant.  It is rare that either would charge for an initial consultation, and the advice they offer in this meeting as discussions of the plans for business development may save many hours and many dollars in the future.

4. Create a trusting rapport with vendors and employees.  There will be many issues in the future where trust may become an issue.  If the development is an online business, and the market offering is new, focus on education of everyone within the environment as a part of the ongoing marketing efforts.

5. Enjoy the business.  One piece of advice always offered to new or existing business owners is to enjoy what the business offers.  Rare is the owner who “happened into” a business—generally, he or she built it with long, sleepless nights and much hard work. Take the time to enjoy what is offered.