Quick, how many counties are there in New Jersey? If you can’t answer this question, you shouldn’t be starting a business, says consultant Herb Caesar. If 30 years of experience have taught him anything, it’s that hitting the books is the first thing you should do if you want to found a company.
A geography pop quiz may not be the first thing on the minds of would-be entrepreneurs, but Caesar says knowing the landscape is crucial when designing your business strategy. “There are 21 counties in the state of New Jersey,” Caesar says. “It makes sense to focus on a target market. When you’re first getting started, you should focus on three or four counties.”
Caesar will offer advice on business planning Thursday, May 15, from 6 to 9 p.m. at the Small Business Development Center at the College of New Jersey. The free workshop is designed to help business owners write simple but effective business plans as solid bases for their enterprises. For more information, visit www.sbdc.pages.tcnj.edu or call 609-771-2947. Those who want one-on-one counseling with Caesar can schedule an appointment for Thursday, June 26, by calling that same number.
New Jersey has quirks that make it even more important to study the various local fiefdoms. “New Jersey is historically known for home rule,” Caesar says. “Every municipality has its own way of doing things. There are 590 school districts, 565 different municipalities, and they are constantly going through evolutions of sorts.” For example, in 2013 Princeton Borough and Township merged.
I’ll take Demographics for $2,000: Caesar says knowing such facts is key to market analysis and financial projections, which are key to enticing investors. (Even if you have the cash to start a business, you will most likely need to raise capital to grow it and make it sustainable, Caesar says.)
Caesar says business owners should use resources like the Risk Management Association, which can provide data on various industries. More information can be found at public libraries, or at databases such as Reference USA. (Available through libraries.) The basic idea of market analysis is, “Tell me about your market, what kind of a product or service you are offering, and who is in need of it?” Caesar says.
“You also need to know the type of competition that is out there. Researching the competition is critical,” Caesar says. That means visiting competitors’ websites, learning prices, or even visiting locations in person to see how they do things, and what opportunities exist for you to compete against them.
The Wheel has Already Been Invented: “There’s something highly unusual about entrepreneurs,” Caesar says. “They believe their idea is so unique, they don’t want to talk about it in public. The reality is, there’s nothing unique that hasn’t been done before. So don’t try to recreate the wheel. There are some unique situations, but I say, understand how the wheel works and tweak it ever so slightly to be able to satisfy your current customers.”
On the other end of the spectrum, some businesses strive to be too generic rather than too unique. “The biggest mistake people make is trying to be everything to everybody. In this day and age, business has become more specialized . people aren’t going to go to have heart surgery done by a foot doctor. They want specialist. They won’t go to a litigator when they need a contract attorney.”
Master the Market: Once you have done your research, you need a plan to market your product or service. That could mean buying ads, using a public relations campaign, or cultivating word-of-mouth referrals. It all depends on the kind of business you have and the market you are in. (You’ve done market research, right?) “Some people can market with advertising, and other people may need referral services, or give your existing customers the ability to give you referrals,” Caesar says.
Putting it All Together: Caesar says a complete business plan has three components: What service will be provided, who the customers are, and how the business will make money to sustain itself.
It Won’t Work: Unfortunately, your business is not going to go as planned. Conditions will be different from what you expected, and you will have to adapt, Caesar says. But that doesn’t mean the plan is useless. “Without a business plan, there is even more chaos,” he says. “It’s the same thing if you do construction. When you have blueprints, and field conditions change, there’s a thing called change orders. At least the blueprints give you a road map. You don’t go into construction without blueprints.”
Caesar grew up in Bergen County, and graduated from Northeastern University in 1979. He played basketball at Northeastern under coach Jim Calhoun, who Caesar says instilled a sense of being a team player. He went on to earn an MBA from Columbia in 1981 and has been in business ever since.
Caesar has helped write many business plans as a consultant to the SBDC Network, and he has also had firsthand experience as CEO of his own residential real estate company, CED Solutions.
Caesar promotes that kind of teamwork at the SBDC, where he encourages entrepreneurs to work together to launch their businesses. After all, one person won’t be good at everything, so why not team up with someone who can cover your weaknesses? “Understanding your skillset and finding someone else who can complement the things you may not be good at is a good thing,” he says.