Question:
What does marketing involve? Isn’t it all about selling and advertising?
Answer:
That is a common fallacy. The truth is marketing involves much more than advertising and selling.
A major part of marketing involves knowing your customers. You study what your market needs, what they want, what they think, what they can afford. You determine who they are, where they live and work, their buying and shopping habits and patterns.
In growing your business, you need to pay attention to the four basic aspects of marketing, otherwise known as the ‘4 Ps.” These are:
Product – the commodity or service you sell
Price – the amount you charge for what you sell.
Promotion – the ways by which you reach your market and inform them as to who, what and where you are.
Place – the stores, outlets and other channels you use to take the product to your market.
Question:
How do I set the selling price for my product?
Answer:
You set your price after you have determined three basic production costs: direct materials, labor, and overhead. After you have calculated these costs, a price is then selected that will be both profitable and competitive. You do not set it too low that you that you do not earn profit nor too high that customers would be inclined to walk away and buy elsewhere.
The most simple and commonly used pricing method by small, start-up businesses is what is known as cost plus. Calculate all your costs and then add a certain percentage of mark-up – 15 or 20 per cent or more. The sum will be your selling price.
Question:
Which is better – to rent/lease my factory, store or equipment or to own these?
Answer:
This is a good question and needs to be considered carefully. Leasing does not tie up your cash; a disadvantage is that the item then has no resale or salvage value since you do not own it. Careful weighing of alternatives and a cost analysis will help you make the best decision.
Question:
Can I operate my business from my home?
Answer:
Yes. More and more start-ups are being run from their owner’s residences.
The advantages of a home-based business are obvious. You save on cost of rental and transportation and even utilities. You can hold down a full-time or part-time job while running your business.
But it really depends on the type of business you have in mind.
Some of the businesses that can viably be run from home are: sari-sari store, cell phone load, commercial garden and landscaping, tutorial, desk top publishing, catering, baking, website designing, accounting and bookkeeping, appliance repair, writing and editing and many more.
Photo: “Plastic shopping trolley.” by , c/o Flickr. Some Rights Reserved