Have a good original idea. Make sure you are not simply recreating another distribution channel or generic ‘shop’. E-Businesses based on innovative patent technology or clicks and mortar businesses such as retailer Next can both work well. Break the rules!
Focus on building sustainable income, not just number of hits or customer registrations
Develop and use key performance indicators that provide early warning signals – such as fluctuations in income per hit rates
Make your site easy to buy from and find a way to measure and monitor customer satisfaction levels – this is your lifeblood
Understand and monitor the actual and forecast cash flows of the business or hire someone who can do this for you – your idea must be commercially viable. Good financial advice is necessary to ensure you build reality and cash flow into your business plan. Have solid financial projections that can be robustly scrutinised for the future of the business.
Don’t give your investors or bankers surprises; keep them informed and ask for their input – you will need them to trust you if things become difficult. You must build transparent relationships with potential investors and be prepared to accept their feedback as to what is fundable or not.
Ensure you have a quality management team for the business. These people should have management and industry expertise in the relevant sector, be committed to the project, be strategic and commercial thinkers and have excellent project management skills.
Continually re-assess and test the current validity of your original business model and don’t be scared to change tack or stop
Keep looking outside of your business – barriers to entry for competition will be low and new competitors will emerge
Consider commercial alliances – there will be many opportunities to join forces with similar businesses
Develop a contingency plan so that you can react quickly and positively if your marketplace changes overnight
Don’t stick your e-head in the e-sand if things start to go off plan – proactively seek advice.