Are You Ready to Offer a New Service? - How Does it Fit?
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You might start by going back to your business plan. If you don’t have one, write one now, as simple or detailed as you want. Make sure it shows you your company as it currently exists. For example, let’s say you host mainly small business websites that use their online presence to drive customers to their stores. You are thinking about giving your customers the option of using a software package that will allow them to make sales over the Internet. How will that change your business plan?
There is a lot to think about here. Does the software package build appropriately on what you already have in place? Do you have the resources to handle an increase in e-commerce being conducted on the sites you host – and how much of an increase? Look not only to your hardware and bandwidth, but your own skills and those of your employees.
Will this addition be cost effective? Does it build on what you already have in place, or are you going to have to acquire a lot more resources (hardware, software, people with particular skill sets) that don’t fit in with the rest of your company? To quote Joel Block again, “If you have to spend an inordinate amount of time getting another part of your business up and running, then you’re using up valuable resources.” You don’t want to start from scratch; you want to make sure those eight revenue streams are related.
If you are the kind of person who needs to see it all in front of you, this might be a good time to sit down with a pen and paper (or a computer and a spreadsheet) and start making some educated guesses as to numbers to crunch. Research other companies that have offerings similar to the new service you want to add. What are their prices? Can you match or beat them?
According to Michael Holigan, owner of a $15 million business that includes a service-based website, it’s very important, when considering a new offering, to “sit down with a piece of paper and figure out your upside and downside. Come up with worst-case and best-case scenarios…you really need to go in understanding the risk factor and how much liability you can afford to take.”
This will help you decide whether a new service offering that you want to add to your business will work, and fit in with what you have. What if you want to come up with a new offering, but you find yourself genuinely stumped? Say you’ve been offering your customers the same thing for so long you don’t know what else makes sense. Keep reading.
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