When thinking about starting a business you want to think about “Why are you starting the business?” Often times someone decides to start a small business with the mindset they have more free time, home based, and have a flexible schedule. Unfortunately, you should avoid these myths. Most the time, starting a small business isn’t any of these things. Instead, it is extended hours, working at home might be a distraction, less flexibility, and there are lots of hats to juggle. It’s very different then working for a company and it is important to keep all of this in mind when deciding if starting a small business is right for you. If it’s, then let’s dive into getting started with your business idea!
Attitude is EVERYTHING. It is advisable to always keep a cheery attitude. A lot of things are going to happen through the lifecycle of the company, both good and bad, and it is important is to keep a positive attitude.
BIGGEST OBSTACLES TO OVERCOME
The two biggest obstacles startups face whenever starting a business is money and reputation. You should make sure you can stay afloat and have a means of financing when starting out. And reputation can be an obstacle because you don’t possess a reputation or customers. Unless you start out with a group of customers, quite often you are getting started very alone.
WHAT YOU NEED?
You need to give a product/service that people want to buy. Researching similar products/services is essential to see what else is out there that is similar to your idea and then determine how your product will be better than the competition. It is also important to have the ability to bring experience to the table. It is the experience you have which will make the company. Typically, you need to have a niche to help you have a focused approach and decide what type of company you want it to be. Lastly, you need to consider if you can sell enough of your product or service to make a living. Are you considering able to cover each of the expenses and salaries that come with a business?
A business plan is absolutely essential. Exactly what is a business plan?
Focus on an executive summary, which is a high-level description of what the business can do. Next, you will need a business information that lays out the business enterprise in detail. Then, comes the marketplace analysis, who is going to be your customer and who’s your rivals? Next, is organization management. Who’s going to manage the business enterprise? Are you going to manage it yourself or will you hire someone from the outside to handle your business? More often than not you are starting off managing the business yourself. Next, you will need a sales strategy, which kind of sales strategy will you encompass? And lastly, it is advisable to include funding requirements and economic projections. Which kind of funding should you start the business and how much do you project to make?
A written plan is critical. It is absolutely essential you write down the above info on paper.
There are numerous business plan templates available to help. Even though you are an established business, its not necessary anything complicated. An additional resource is a straightforward roadmap. This breaks out month by month projections for just two 2 years. What industry events will you attend? How many people will you hire? What type of marketing campaigns do you want to run?
Last, goals are extremely important. You need to set specific goals in your business plan so you know what your location is heading.
MEANS OF FINANCING
How will you finance your business? Some of the key concerns to ask are how much money will you need to stay afloat? Will you be going for a salary? Exactly what will your non-salary expenses be? How many people do you anticipate hiring the first year? What about company benefits? Even if you are by yourself, you will need benefits and insurance. These are all questions you must think about.
Should you self-finance or take out a loan? Self-financing is often recommended if you have enough money in the lender to float the business and your salary for per year or two. This option reduces the pressure. The last thing you want is pressure from creditors. Loan products are going to be difficult to procure. In the event that you manage to get yourself a loan, you will need to personal guarantee and you may need collateral.
There is also the possibility for a financial business spouse, however, a financial business companion can often lead to meddling and pressure. In addition, it may cause you to run the business differently then you envisioned. Remember, you’re starting the business to put your own spin on it!
A fourth option is really a funding company. It is a viable option because they will most likely perform your payroll and invoicing for you personally. Sometimes the funding company will provide a basic ATS system as well that could help you start off. The downside to a financing company is often it is hard to breakaway. You have to pay off loans with interest and in some cases it is not financially feasible to breakaway. If you use a funding company, you intend to be sure to understand the agreement and know very well what it takes to step from the funding company.