Starting your own business is never easy, it takes time, money, effort and most of all – perseverance! If you are currently considering starting up your own business, here’s the top 5 things you need to look into before taking the big leap.
1. Put together a business plan
The sad fact is that most businesses don’t actually make it past the first year because they have poor cash planning, inadequate market research and most of all, they don’t have a proper business plan. The very first thing you should do before starting a business is create a business plan. That business plan should highlight where you want to be in the next 5-10 years and should also highlight your goals as well as provide details on how you will achieve these goals. Nobody else has to see it; this is your own personal guide on how you will grow your business.
2. Will you be providing a product or service?
Of course, if you’re planning to start a business you should already know if you will be offering a service or selling a product to the consumer. Most budding entrepreneurs start a business based on their knowledge and expertise on a specific industry sector, others start a business based on something they’ve always been passionate about and some start a business because they can see a ‘hole’ in the market which they want to infiltrate. Keep in mind that once you’ve decided on what business you’ll be starting you then have to determine what would make your business different? Will you be offering a cheaper product or a faster service? What would make your product or service better than the competition? What’s unique about your business that others would pay attention?
3. What will be your business structure?
There are actually a number of choices to choose from when it comes to business structure, the most common ones though are sole trader, partnership and limited company. The typical choice by most people is the sole trader business structure because it’s the structure with the least hassle. In saying that though, this business structure can actually affect your personal security. If you’re wondering what the best choice is, well here’s a brief description on the 3 business structures: As a sole trader you carry all the risk – which means that if something goes wrong in your business then you are personally liable for all the costs. If you are thinking of entering a partnership structure with a bunch of friends, keep in mind that things could all change at some point due to the demand in the business and it could possibly ruin your friendship. Now if you are thinking of setting up a limited company, yes you may lessen your individual liability, however, it’s not cheap to maintain a limited company structure because you’d have to pay a yearly government fee – and this will be tough on you especially if you won’t be making any money yet in the next 3 years. If you are seriously thinking of setting up a company for the first time, it’s probably best to obtain professional advice from either a solicitor or accountant so that they can explain the risks and costs involved.
4. What will you name your business?
Finding a name may sound like the easiest part in the process – but think again! Some companies take years before they can come up with a suitable name for their business. Think about it this way, the name of your business will be its brand for life, whatever name you come up with is what you’ll be working with for the duration of the business. Here are some questions you should ask yourself: Does the name suit the product or service you are offering? Is the name original? Can you trademark the name? Is the name available online? It’s always good practice to register the name of your business to the Fair Trading office straight away to make sure that no one else has the exact same business name as what you have.
5. How are you going to market the new business?
Marketing is a crucial part of any business, without proper marketing your business is as good as dead. The big question is: what approach will you take to reach your specific target market? Do you need to look into magazine ads, billboards, social media or maybe direct mail to reach your target market? Your marketing approach will of course depend on what your product or service is, it’s basically trial and error at the start. Just take the plunge and start your marketing efforts and whichever one works for your business is what you should stick on. If you don’t know where to start it may be a good idea to find out what you’re competition is doing, you can always do the same thing but just give it a bit of a twist to make it more favourable for your business.