Are you always coming up with great ideas only to stumble upon them on shelves soon after? If yes, you might have the entrepreneurial spirit deep inside you, according to Lori Greiner.
The retail expert and fierce investor on ABC’s Shark Tank dished on her tips to entrepreneurial success this morning during a Q&A at Staples on 5th Ave.
Ms. Greiner—often referred to as “The Queen of QVC” because of her show’s successful six-year run on the shopping network—has launched over 400 products and holds 120 patents in the U.S. and internationally. She has an astounding 90 percent success rate in launching new ventures, and she knows a thing or two about creating multi-million dollar businesses. These are her best tips for entrepreneurs:
Evaluate Your Idea
Is it for a mass audience or a select few? Can it be made inexpensively? Is it unique?
It’s important to understand how your product compares to what’s already out there. Unique products that solve problems do best. If your idea is brand new, you can corner the market.
“If something has a hold on the market already, you’re not going to have an easy time,” Ms. Greiner said.
Do Your Own Market Research
When Ms. Greiner was creating her first product, an earring organizer that she eventually licensed to JCPenny, she showed a prototype to women on the street to gauge their interest and see if the idea was worth pursuing.
She stresses “pounding the pavement” to see if people would buy your product and how much they’d pay for it before investing a ton of cash into the business. And definitely do not do this over the Internet, she warns, or else your idea could easily spread like wildfire and get knocked off while you’re only in stage one.
“Everyone thinks they have the best idea and that everyone will buy it,” Ms. Greiner said. “I think you have to think of your business idea or product idea, ‘Is it something people need and want, something people truly need and want?'”
Packaging, Packaging, Packaging
If your idea is a product with a future in retail, packaging is key. Consumers need to instantly gravitate to it, pick it up and be able to tell what it is and why they should buy it.
“My entrepreneurs know,” she said. “We go through a lot of packaging until it’s perfect.”
Don’t Overspend and Do All of the Hard Work Yourself
Ms. Greiner says to “stay lean and mean.”
Don’t rent out a fancy office. Don’t fill up a warehouse with inventory you can’t sell. And definitely don’t hire employees until you absolutely need them to keep up with business. Doing so will eat up your capital, and employees won’t be running as quickly as they should to get your business off the ground.
“No one will run your business like you do,” she said.
Hold On to That Equity In the Beginning
Desperate for cash, too many entrepreneurs make the mistake of giving up 40 percent of their business to their uncle for $10,000 a month in. Ms. Greiner’s advice is to hold out and figure out another way.
“You will regret it down the road,” she said.
It’s not worth it even for that small amount of cash you think you need, and be especially wary when borrowing from friends and family. They usually want their money back, and when you’re risking it all in a business venture, you can’t be sure it will survive.