In Part 1 we discussed: • Common business applications for drones • How does “Drone Services as a Business” work? • How big is the market? • What are the risks?
You can read Part 1 here: sUAS Guide Issue 01
In this instalment we’ll propose some how-to’s: • Considerations for starting your business from scratch, • Discussion of some business/financial assumptions, and • How to mitigate some of the risks we identified in Part-1.
Then in the next instalment, we will go through some case studies, talk more about marketing plans, and funding sources.
Getting your business started
Starting a business is not easy; in fact, most businesses fail in their first year and fewer than 20% of those remaining will survive for five years. Furthermore, the drone industry is brand new and experiencing dramatic accelerated change which creates significant additional risks. If you were starting an auto business or selling TVs, there are some best practices you could draw upon but because DSAB is an emerging industry, we are all trying to figure it out as we go along. There are still many lessons to be learned as the marketplace accepts this transformative technology.
That said, starting a service business usually doesn’t require a large capital investment, can take advantage of many inexpensive business and technical systems, and can be started fairly quickly. In the DSAB model, a small investment in a drone, some post processing software, and readily available cloud/internet based business systems for sales/marketing, accounting, etc. can put you in business in days or weeks.
If you are starting a business for the first time, we strongly urge you to consider developing your initial plan through fast prototyping and using the business model canvas methodology: -https://en.wikipedia.org/wiki/Business_Model_Canvas . Another good source if information is “The Startup Owner’s Manual” by Steve Blank. You must have a plan even though it will change. Without a roadmap to get started you may end up a few months down the road chasing ideas that are not critical to your success. Key issues to begin with include:
Conduct market research You don’t need to hire a marketing agency and conduct focus groups. Instead, decide who your target market is and how you will attract them - Then before you do anything else, go out and talk to at least twenty prospects, preferably in person. The best way to find out what a customer needs is to ask. Said another way, building a product/service in a vacuum is a sure plan for failure. Use this time to define exactly how your service offering will solve the business problems identified by your prospective customers.
Build a go-to-market plan No, people won’t beat a path to your door if you build a simple website and wait for customers to show up. Even the best mousetrap needs to be sold. More on this when we go through some case studies.
Test early assumptions Find a way to test your early assumptions by trying to sell your service…. Worry less about the price at this time and more about getting someone to say YES to your offering.
Adequate resources Make sure you have adequate resources, (usually people, time and money), to weather the many ups and downs you will encounter as you grow your business. Most businesses fail because they run out of money. With some early planning you can help avoid this pitfall.
Just go do it! The old Nike commercial still applies. Get out there and personally do some jobs. Experience will tell you more than anything else what is working and what needs to change.
As you gain a little market experience, additional factors will become important:
Customer Acquisition • Who will you target to get customers? How will you get to the decision maker buying your service: advertising, direct/indirect sales, word of mouth, more? Sometimes it may be helpful to work through channel partners and other times, you should sell directly to your end customer.