The decision to start a business can be tough. It can feel like there are a thousand things going on at once. As a new small business owner, you can’t avoid this reality, but with a little planning, you can manage expectations and execute activities with a sense of purpose toward expanding your business.
According to experts, beyond giving it your all, it’s important to direct your energy to the right tasks – especially at first. Here are six important things to keep in mind before starting a new business.
Six things to do before you start a business:
1. Do your research and make a business plan
Businesses should be founded on strong study and planning, which includes securing appropriate funds, establishing the proper structure, and assembling a competent staff to carry out operations; all of these aspects can have a substantial impact on the growth and survival of any company.
Before taking such huge steps toward becoming your own boss, it is critical to have a strategic business plan in place; learning about potential hazards ahead of time helps better prepare entrepreneurs when making strategic decisions. Starting a business may take longer than expected if done correctly, but it can yield enormous profits once everything falls into place.
Take the time to put together a business plan that includes:
- Your mission statement
- A description of your business
- A list of your products or services
- An analysis of the current market and opportunity
- A list of decision-makers in the company, along with their bios
- Your financial plan so those who review can understand the opportunity
2. Determine your audience
Consider your target demography. This audience will drive every decision you make. Knowing who needs your product or service can help you fine-tune your offers and target your marketing and sales efforts. Part of this process is determining whether you are a business-to-consumer (B2C) or business-to-business (B2B) company. Those factors include age, gender, income, and profession. You can’t make money without customers, therefore know who they are.
3. Get online
Consider the value of your customer base and how much income it will bring in. According to FitSmallBusiness, nearly 54 percent of consumers choose to shop online rather than in person at places like malls or exposition halls or physical stores. This means that having a presence online is essential to your success.
4. Understand your tax burden
Travis Sickle, a certified financial planner with Sickle Hunter Financial Advisors, urges entrepreneurs to keep taxes and fees structured. There are several payments to be made, and failing to make any of them on time could result in serious consequences.
5. Understand the risk
Of course, there will always be some risk involved in starting a new firm. Before you begin working on your business, it is critical to calculate, evaluate, and plan for risk. This entails examining the risks associated with your sector before moving on with a business plan. Be honest with yourself and your company partners about the risks involved; this will help you prepare by obtaining the appropriate types of insurance to cover your new venture.
6. Right timing
Timing is a key aspect of starting a business. Sure, you want to start your firm when the economy is strong and your prospective industry is flourishing, but there is also a flow to decision-making that you should be aware of. When it comes to developing a business, Kevin MacCauley, the founder and CEO of Upper Hand, believes that being decisive is essential.
He said, “I wish I understood how detrimental the role of time [can be] in building a business. You only have so much time to find out if you’ve made the right business decisions. As I once read, if you’re 70% of the way to making a decision, make the decision. If you try to get to 90%, you’ve waited too long. If I could have had that mindset from day one, I would probably have had fewer sleepless nights when I was going through tough times.”
Some important first stages in beginning a business, according to experts, are researching competitors, examining the legal issues of your industry, considering your personal and business finances, being realistic about the risk involved, understanding timing, and more.
Related: To get your more prepared to start your business, you can read 3 Ways to Conquer Your Fear of Starting a Business.