Starting a Business? 6 crucial things to consider
Starting your own business is a major step in your life. It can be quite an experience, handling a dozen things at once while basking in the light of your dreams finally turning into reality. Perhaps you have been looking up to the likes of Bill Gates and Elon Musk and are finally at a point where you, too, can jump on the entrepreneur’s bandwagon. However, as they say, you should never compare your day one to someone’s hundredth day. Similarly, in order to reach their level, you need to survive the first few crucial years of your business. It is a fact that, while there may be plenty of start-ups, only a few cross their survival stage. In order to be one of those, you need to look into certain things before you start so that you can set off on the path to success.
Your prime location
Location is absolutely crucial to your sales. You need to analyze the surroundings of your location. For instance, if you launch a designer shoe boutique and choose your spot between software houses, you will likely suffer considerably. This is because you are not only away from your competitors, but your target market cannot even access your products here. Therefore, your location should be where you are accessible to your target audience. It should also be close to your competitors and in a location where you get other ancillary services. For instance, a marketing or consultancy start-up may want to consider a corporate office at The Executive Centre where it is surrounded by other corporate offices to capture clients and has the ancillary services to help smooth out the process of running a day-to-day business.
A ground-breaking idea
If you want to start your own venture, you will need an idea. Typically, a product or a service that solves your audience’s problems will likely be in demand very quickly. Of course, not everyone can come up with unique, original ideas right on the spot. Instead, they could offer an improved version of someone else’s idea or a more affordable alternative to a high-end product. For this, you can try paying attention to people’s problems and the products they turn to as solutions. Then, analyze how you can make their solutions easier, more accessible, more accurate, or more efficient and affordable for them. And there you have it – a business idea!
Know your customers and competitors
It is essential to know your target audience because that is how you will know how to market your product to them. You will need to research their taste, issues, and the solutions they might be looking for. Then figure out how you will approach them, so they find your product appealing. Remember: your customer is your king!
Similarly, you need to know who else is selling a similar product alongside you. Your competitors have been in the industry longer. They have crossed their survival phase and probably have a strong grip on the market shares. You might have to aggressively market your unique selling point to draw customers to your brand from your competitors. Eventually, this will lead to you gaining more market share. However, that is not all. Established businesses might not want more competition in the market and may set up competitive pricing strategies to drive you out. Hence, you need to be vigilant as a newbie and have an effective marketing strategy in place.
Have a vision and a plan
A business plan is essential for every start-up. It makes you outline your short and long-term goals and have a clear-cut vision and mission. Writing down a plan helps attract executives to work in your business and comes in handy when you are looking to raise capital, for instance, by applying for a bank loan. It is a document containing all the relevant information about the business and your future. Stakeholders can review it and make decisions such as investing in your business. Additionally, when you get too bogged down with the pressure of running your start-up, this business plan will help you refocus on your true long-term vision. It will remind you why you are doing all of this in the first place.
Plan your finances
Most start-ups are self-financed from personal savings. Though it’s enough to get you started, it’s not very feasible for growth and long-term plans. Therefore, reaching out to friends and family for investments is crucial. You could also consider starting a partnership, which allows for more initial capital. This is also the stage where your business model will come in handy. You could consider going to a bank such as any microfinance bank that gives loans to support start-ups at low-interest rates. Aside from major investments, you must also figure out your cash flow. That is the day-to-day working capital that you will use to meet miscellaneous daily expenditures. Running out of cash flows is one of the biggest factors in the downfall of businesses. For this reason, cash flows are known as the lifeblood of businesses and must be planned out effectively.
Make correct hiring decisions
Employees are a firm’s greatest assets and serve as the backbone of a company. Therefore, they should be chosen wisely. Since you are just getting started, you may not have enough to hire many people to work with you. Start with an accountant and a mentor. You are likely to hit burn-out very quickly if you try to do everything on your own. Let a professional accountant handle your transactions, accounts, and profits.
Additionally, their experience will prove to be invaluable for your business. Alongside, hire a mentor. It is better to have someone who has been there and done all of that to guide you along your path and help you make the right decisions. This is crucial for your long-term success as a trial-and-error method may be detrimental to your business.
Starting your own business is an exhilarating journey. People may embark on this mission for various reasons, such as being their own boss, becoming a CEO at a young age, or because they want to explore something they are passionate about. However, it is not an easy job whatsoever. It takes an innumerable amount of effort, discipline, strategy, and management to get a start-up to go beyond the break-even point and survive the rough first few years. With careful consideration of the abovementioned aspects, you are likely to be well on your way to success—best of luck.