By Anthony Hanson
Starting your own small business is an exciting prospect. But as you get closer and closer to the day where you can finally quit your day job and embark on your own entrepreneurial adventure, you can’t forget about all the ways in which you need to be prepared. Otherwise, your business will fail before it has the chance to begin.
There are several things you need to know when planning to open your own company. Here are the top 10 things to consider before starting a small business.
1. Write Your Business Plan
What kind of business are you starting? What do you hope to accomplish within the first year? What are you going to sell, and how are you going to sell it? Do you have a mission statement? All of that and more should be highlighted in a detailed business plan. It may seem like a lot of work upfront, but a good business plan will serve as the foundation for all of your operations as you move forward. And according to Bplans, a good business plan can help your company grow 30% faster and you will see a better increase in performance overall.
2. Collect Cash
This might seem obvious, but you do need to have a lot of money saved up before officially starting your small business. The more capital you have to start off with, the bigger investments you can make into your company’s growth and success. Keeping a good amount of cash on hand is the best way to start your business off on the right foot.
Cash flow planning is different from managing overall savings and profits. You need cash to be able to pay off loans, purchase inventory, make payments, and stay on top of resources that change in price due to market fluctuations.
3. Gather All of Your Funds
Besides having cash, you need to gather general funds and save up as much as possible before opening your business. The Start-Up Donut reported that most small businesses spend more money than they earn for the first 2-3 years that they are in business. Some small businesses even report that they didn’t make a true profit until 5 years into the operation. You need enough savings to be able to support yourself and your business needs while taking into account that you may not make a lot of money for a while.
4. Choose Your Company Name
Before you can go far with your business, you need to name it! There are definitely certain strategies you can approach if you are having trouble coming up with a name. Some companies are named for what they do, others are named for a cause or industry they want to support, while others are named after an individual. Keep your marketing tactics in mind when coming up with a name as well. Be sure to make an impact. You can use this guide to see if the name you came up with is already taken.
5. Find Your Target Customers
You likely already have an idea of what kind of business you’re starting. Perhaps you are thinking of starting a company in the service industry, or maybe you create unique products that you know a certain group of people will love. The important thing is that you find those people and learn as much as you can about their wants and needs.
This is what’s known as market research. You need to educate yourself on what your preferred customers are looking for, how they typically buy products, and how your products or services can help with their needs.
6. Create a Marketing Plan
If you want to succeed and grow your business, you need to focus on an assertive marketing plan. It’s imperative that you get your name out there. Otherwise, nobody will know about you or know how to find you. You can start by getting some marketing materials, which are usually cheap or even free. You can do something as simple as print business cards with your company name and some contact information, or you can do some old-fashioned door-to-door flyer marketing.
7. Establish an Online Presence
Speaking of marketing, the best way to market your small business completely for free is to get online. Start having a consistent social media presence across all of the free platforms like Facebook, Instagram, and LinkedIn. If your small business creates media, you should have a YouTube channel as well.
According to HubSpot’s State of Marketing Report, free online marketing with visual content generates three times more leads than any other kind of marketing. Not only is it essential for your business to engage with the community in real-time, but it’s an easy way for knowledge about your business to go viral.
You’ve also got a lot of digital marketing channels at your disposal, the two biggest are probably SEO and PPC. You can try both these yourself to save costs or find a digital marketing agency to help you.
8. Hire Some Employees
Some small businesses can be run completely independently, depending on how small they are. But if you are looking to expand even a little bit, you should have a couple of trusted employees by your side. The most important person you can hire at the beginning of your small business adventure is an accountant.
Getting a handle on your own finances and legal financial requirements that come with starting a business can be overwhelming when facing it alone. Find someone who is an expert in financing and who can help you with business tax returns and much more.
9. Find a Place to Work
After you have your plans and some of the basics drawn out, you need to start looking for a physical place. While some businesses can be operated from the comfort of your own home, most companies need a place where they can legally and comfortably establish a workplace.
You probably don’t need a lot of space at first, but somewhere where you can work quietly and have plenty of room to spread out documents would be fitting for your first place.
You don’t want to buy or lease an office straight away unless you have the investment and some customers to begin with. Be mindful as you grow and expand, there are loads of entrepreneur journeys nowadays that start form bedrooms to boardrooms!
10. Don’t Forget to Bring Your Passion
You can have all of your money, resources, and office space available on day one. But you still won’t make it very far if you don’t have the passion. The whole purpose of starting a small business is for you to profit off of something you are passionate about. If you don’t love what you do, then don’t do it!
Remember that starting a small business is full of ups and downs, it will literally be a rollercoaster. It’s going to be one of the most fun and exciting times in your life, but it won’t be without its fair share of frustrations and roadblocks. Starting a small business is a learning process, and by preparing beforehand, you will be well on your way to your very own small business success.
Start Your Small Business Today
If you don’t prepare, you are bound to get overwhelmed before the company even has the chance to get off the ground. Take all of the excitement and passion you feel for starting this new venture and channel that energy into the preparation phase.
Write a stellar business plan, start investing in free marketing techniques, and build up a clientele that will give your business the personality and reputation it deserves. With any luck, you will be a successful small business owner making your place in the world.