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4. INITIAL OPERATIONS

c. Clients and Customers

Market Focus

Conventional wisdom says that most companies fail within their first year of operations, most of the surviving companies achieve only modest success, and the few companies that achieve major success do not “pop” until 3-5 years of operations.

In order to maximize your odds for success, perform market research and determine how to satisfy one or more specific needs of your potential clients or customers. If the market is not yet aware of its need, you will need to spend a lot of extra time and money on marketing activities.

Standard Form Agreements

Next determine the business terms to offer the potential clients or customers. Be realistic. You may need to compromise in the short run in order to succeed in the long run. If necessary, discuss price and payment terms with a CPA or business consultant.

Work with a business attorney to develop one or more agreement templates. This process will pay dividends by forcing you to evolve your business model and address hidden risks. Also, you'll be able to hit the ground running and provide an agreement to a client or customer immediately upon attracting their interest. You'll save time, negotiate better deals, and appear more professional.

Be warned that regardless of your initial proposals, some clients and customers may want to negotiate more favorable terms – especially if they hire an attorney to finalize the agreement. Therefore, you should probably leave some “wiggle room” in your template agreements for negotiations. That means including provisions that could be eliminated or softened upon request.