Starting your own business can be one of the most rewarding experiences you’ll ever have. But it also requires plenty of hard work and determination. So you need to make sure that any time spent working on your business is worthwhile, as you could jeopardize your new venture if you don’t do it right from the start.
Business owners often talk about a rush of blood to the head’ that takes place when they have an idea for a business or product they think would sell well. Although this sounds like a great thing, there are many pitfalls along the way which may stop your ideas from taking off and turning into success.
There is no time that is “right” to start a small business. It all depends on why you’re doing it first and what stage your current career is at. That said, answering these questions below can help you know when you are ready to start a small business.
#1. Who is my target audience?
If you can’t clearly define your target market and research their needs, then how will you know that what you’re offering is what they want or need? Defining your target audience by thinking about the ages of people interested in buying from you, where they live, and what their lifestyle is like is even more critical if you plan to sell something online.
This doesn’t mean that people within this age range must all buy from you, but it does mean that targeting everyone would be too broad and wouldn’t get the best results. On the other hand, targeting specific groups within these categories may not guarantee that they will all buy from you, but it’ll increase your chances and lower the initial cost.
#2. Do I have enough money to start my business?
Starting a small business is not a cheap task. Starting up can cost more than you might think. The following are some of the costs associated with starting a new venture:
Set Up Costs – You need to make sure that you can set up and run your business without too much hassle (even if you plan for minimal staffing at first). This includes registering as an employer, renting premises if required, branding materials (stationery/shop signs/business cards), insurances, website and/or social media costs, buying stock and equipment.
Running Costs – Businesses need not only startup capital but also ongoing money to keep them running. This includes items such as the cost of paying an annual fee for your business premises if you rent them, utilities (electricity/water) which are essential but can be a major drain on finances. Advertising and promotion may be needed to support the launch of a new product or service. Staff wages that become necessary with increased activity/sales/customers. And finally, taxation costs (like paying sale tax and licenses).
#3. Do I have what it takes?
Before you take the plunge into entrepreneurism and go out on a limb to start your own business, you should consider whether you have what it takes to succeed in business. This includes:
Self-Motivation: You need to make sure that your motivation is strong enough to help you through the many challenges that will come your way when running a business.
Patience and Perseverance: Starting a new business can be a long and arduous process, so you need to make sure that you are prepared for this journey (good planning will go a long way!).
You also should be able to think outside the box and approach problems creatively if things don’t go according to plan. Having determination from day one will show potential customers that you mean business!
#4. Can I guarantee my success?
When starting any new venture, there is no way that anyone can guarantee their success though it does not mean that you shouldn’t try at all costs. Keeping this in mind, when you have developed a business plan and started the launch of your enterprise, you can still help to stack the odds in your favor.
First of all, do some research with other companies already operating in the same sector. This will allow for an insight into current trends and how much competition there may be for customers’ attention. In addition, you should consider looking at what market share competitors currently have, and what marketing methods they use to achieve this (including social media), so you can adapt accordingly if necessary.
It is also worth considering whether there are any opportunities for expansion that could further help boost your sales (maybe branching out into new products or opening another branch).
Another advantage of talking with existing businesses is that they may refer you to suppliers who could be helpful for your enterprise.
#5. Can I compete with the big boys?
Another good question that potential entrepreneurs should consider when they are starting up a new business is whether they will compete with larger, more established brands in their sector.
Making sure your products or services are tailored appropriately to appeal to customers will help you in this area because you can offer something that rivals cannot. If there is one approach that will give any business a head start, it is hard work and persistence, and if you are prepared to do this, there could be no stopping you!
Ensure that people know about your new venture by promoting it online through social networking sites and creating a website and listed on directories like Google Local Business, BBB, Yelp, or Yellow Page.
An established brand is not necessarily an obstacle to success because you can still make your own mark on the market. One way of doing this is by getting involved in community events, such as running seminars or exhibitions, which will be good for publicizing your business while also providing valuable insights and feedback about doing things better.
Another option may be that you could acquire another enterprise to tap into its existing customer base.
#6. Can I afford it?
Taking all of these factors into account, when considering if now is the right time to start a small business, it is worth evaluating exactly where your financial needs stand (including costs associated with buying a new business, and what funds you have available for your business to travel along its journey).
It could be that your savings are not quite up to scratch for the purchase of an existing company or other assets, which is why it may be worth considering alternative financing methods, which will mean lower interest rates. These can include grants from government bodies or private investors as well as bank loans or credit cards.
Some people also choose to bring family members on board when they start a business to share the workload. This can help get an enterprise off the ground while leaving enough spare time to follow other pursuits such as working part-time elsewhere (as long as there is no conflict of interest) and fitting in with any employment laws.
#7. What does the future hold for my business?
Although it is important to consider your finances when deciding to start a new enterprise, having a good idea of what you want your company to achieve can also be a motivating factor (which may help secure funding). This could be establishing yourself as a local brand that people trust and rely upon in their day-to-day lives so they can get on with doing more enjoyable activities.
If you are trying to lead the pack, what better way than being an innovator who sets trends that rivals have to follow to compete? Whatever avenue you go down, make sure there is always room for improvement because this will demonstrate how dedicated you are and show that a business can be successful even if it is small.
#8. How much money do I need to start a small business?
As with any business, there will be startup costs involved when you first get started, but if your idea is cost-effective, then it should begin bringing in revenue from the outset too. To make sure that you have enough capital saved up before launching, it may be worth sticking with your existing job until enough funds are available so you can stop worrying about whether or not this venture is going to work long-term. Then, once an amount has been set aside, decide what equipment or resources would be best for your company, and once they’re in place (or hired on a contract basis), then you can launch straight away!
#9. Can I start a small business with little or no experience?
Many new businesses are not run by people who have years of industry-specific training under their belts; instead, they tend to be created by people with an idea and perhaps some entrepreneurial spirit who know they want to provide a product or service which hasn’t previously been available.
If this describes you, then there is still hope because if your offering is unique enough, consumers may not be too concerned about the exact number of years it took for you to put together your company in the first place – so as long as you are providing something worth buying (and telling others about!), it should still prove that running your own enterprise can pay off!
#10. How much time do I need to be able to commit?
Life does not stop just because you have started your own company. In fact, there is likely to be more pressure on you than ever before with so many different tasks which require your attention.
On top of this, the longer a business runs, the harder it can become to earn enough profit from sales (particularly if staff is brought in), and it might even mean that you outgrow your premises or other resources. As a result, it may be necessary to make sure that all aspects of running your enterprise are streamlined as well as possible, so customers get the best service possible and all the time they deserve!
#11. Why do I need to start my own small business?
If you feel like you’re destined for better things than just working 9-5 and receiving the same amount of money from your employer each month, it may be worth considering your options.
Starting a new business can be very risky, and you will almost certainly need to contribute some of your own money towards getting started, but if you’re passionate about providing a service or product which hasn’t been on the market before, then starting a small business from scratch could be the way to go!
#12. Do I have all factors sorted out?
One of the most important is whether there is a market for your product or service. You have to be sure that customers will want and be able to afford what you’re offering. Otherwise, it will just remain an idea on paper rather than a successful business venture.
It would be best if you thought about how much time is involved in your plans because the workload is too much, then working on the business may interfere with your current job.
There are also legal issues to consider when establishing a new enterprise, including setting up as a limited liability company, registering for licenses, and preparing for tax, so you should seek advice from experts such as a CPA or business lawyer.
Another thing which you need to know about is how to produce, package and distribute your product or service. If you are selling online, consider what sort of payment options you want to include and whether you will be shipping products yourself or using a third-party courier.
For those thinking about setting up their own business in the real world, think about which customers you’re going to target and where they frequent (maybe walking distance from a shop-front rather than having mail order), so you can focus your marketing efforts on these areas.
To sum up, starting a small business is not an easy route to take, but if you are willing to devote the necessary time and effort, then it could be well worth your while. As long as you can answer those above questions and develop a concrete plan for your startup, you should be ready to start your small business. Remember that persistence and hard work are the keys to success!