If you search for the topic “items to consider when starting a business”, Google will return 19 million choices to click on. Some have sites 50 items listed; some have 5. This does not count the numerous ads for How to Start a Business, Why Start a Business, etc. I think every entrepreneur has advice for the business start up, and your humble author is included in the group!
Let’s assume you have gotten the entrepreneurial spirit. You know there will probably be no vacations or sick days for at least 2 years. You admit to yourself you don’t know everything about running a business. You know that you will have to invest a good portion of your life savings into the business. After knowing all this you decide to move forward.
Here are some basic items to consider and research as you grow into the Grand Opening:
- Take advantage of free seminars or inexpensive classes where you can learn about business disciplines you will be required to know as an entrepreneur. If you know marketing and don’t know about taxes find a tax seminar. If you are an accountant find a free selling seminar. Sources can be your local Small Business Development Center (search SBDC) or the Community College. My local Community College offers an inexpensive Quickbooks course over 3 nights.
- Determine there is a demand for your product or service. Then find out what will make your business unique. Put down on paper why you are qualified to run this business. Finally be able to describe all this in 50 words or less. Doing this will help you present a logical, concise description of your business to investors and marketing advisors.Know everything there is to know about your competition. Know their pricing, marketing, the layout of their website, customer retention policies, etc. You need to define their advantages and disadvantages to form a plan to compete against them. This will help you define the uniqueness of your business.
- What will your business entity be? Common forms of business entities are a sole proprietorship or a Limited Liability Company (LLC). Research what the differences are. Both are very simple to form but the costs are very different.
- Develop a name for your business. Here is something to consider. If you are going to have a website, make sure the URL is available that will tie into your business name. For instance, if your business will be called The Clear Spot, make sure “theclearspot.com” is available as a web address. If it is not available, think of changing the business name. Obviously, there is some coordination required in securing the name of your business.
- Stay legal. Do you need a sales tax certificate? Will you have employees or contract workers? Will you need an Employee Identification Number (EIN)? How often will you need to pay taxes?
- Do a cash flow forecast and find out how much cash will be required to get the business thorough the first year of operations. Where will the cash come from?
- Most important of all, remember that planning is everything! Once you open, all you should be thinking about is “How do I get the next sale?”
This is not the most extensive list out there but it does cover some basics for the start up entrepreneur. There is no magic formula for success because no matter how hard you plan, some businesses will prosper and some will fail. But you can increase your chances of success by planning to avoid the pitfalls of failure.