Now let’s talk through some of the first steps of starting a new business. But first, let me mention that most small businesses fail within the first year. And if that doesn’t discourage you, then you may well have the attitude that it takes to be successful – dedication, perseverance, and strength of focus.
The first thing that you need is a plan. In the early stages, the plan may be vague. But, it does need to be a little more specific than ‘We are going to start our own company and get rich!’
That may be your goal. But, when you are writing your business plan, you need clear goals, and an outline of realistic steps to reach those goals.
Here’s a very brief example, of an introduction to a focused business plan:
“XYZ Company, consisting of two partners, will buy and sell antiques and collectibles, both online and off. Each partner will invest $$ for start-up costs, including the costs of registering a domain name and paying for web-hosting services.”
Another thing that must be included in the plan is an estimate of when the company will break even and start to make a profit. That’s particularly important if you need funding or a line of credit.
Excel is a fantastic tool for putting such projections together – and do put together both very conservative, and optimistic predictions, based on research (so that they’re not complete guesses). That may then give you an ‘average’ for important figures, which means you haven’t got too carried away in either direction (worrying too much, or over estimating how your business will initially do). This allows you to make realistic decisions right from the start.
So that’s some of the who, what, when and where, of how to start a new business. Be sure to cover in your plan, at the very least:
* Deciding who will participate
* What the company will do
* What the start-up costs will be
* When the break-even point will be reached
* Where the funding will come from
* Examples of your competition
* How you will market against your competition, and bring in new customers
* How you will generate repeat business
…and so on…
If you haven’t decided what you want your company to do, if you don’t have your “heart set” on something, it’s a good idea to learn what other successful entrepreneurs have done. You may find certain businesses that resonate with you. And also think – what kind of business lifestyle do you want:
* Would you like to work closely with clients over the phone, or in person?
* Would you like to manage other people?
* Or would you prefer a business you can run from home, keeping to your own hours? LegalZoom vs Incfile
Building the kind of business you feel is right for you can greatly increase chances of success. If you don’t enjoy what you’re doing, you may well find it difficult to gather the strength of purpose to get past business set backs.
It’s vital to learn about your competition — let’s say you choose to open a dry-cleaners, at the very least you would want to drive around your city and count the number of dry-cleaners that are already open. At the same time, you could look for a location that has the least amount of competition. It would also help to visit them as a customer, and if you can sit and have a coffee opposite them for example and watch how they go about their business for a couple of hours, and how many customers come and go. The more you know about your SUCCESSFUL competition, the more you can duplicate their success, and even overtake them!