To start a business takes planning, making important financial decisions, and completing a series of legal activities. You will need to set goals, put plans into action, assess your progress, make necessary adjustments and grow your business. There are plenty of things that every business needs to do to get off the ground. So, here are five key questions to ask yourself as you plan to start a business.
1. Do I have what it takes to make it as a business owner?
Before you start a business, you should be able to answer a few very important questions. What product or service are you offering? What makes your product or service different from everyone else? Who is your ideal customer? How does your product benefit them? Answering these key questions will help define your business identity. Once you identify your business identity it’s important to remember, success in business requires passion, a lot of hard work, staying power and drive. According to Elizabeth Wilson of Entrepreneur Magazine, while some 40 million businesses are started each year, only 350,000 break out of the pack and begin growing and making money.
2. What is my niche and who is my target customer?
Before you start a business it’s key to know who you’re paying customer is going to be. You may have a great product idea that people need, but that is not enough to break through. You need to solve a problem that people want a solution for, and more importantly are willing to pay for.
Don’t get trapped into the mindset that if you don’t offer everything, you’ll miss out on customers. Offering everything doesn’t mean that every person will buy your products or services. Find your niche and identify your target market. A niche is a specialized product or service you offer to your ideal customer. Your target market is the ideal client looking for what you have to offer.
3. Who will be on my team to help with my new business?
Starting and growing a business requires more than going at it alone. It takes a team to build a successful business and it’s just as important as developing your product. Even if you plan to be a sole proprietor, you can benefit incredibly from creating an outside support team to keep you focused and on track.
You’ll also need to pull together a team of people as you set up and launch your business. These will be people that are needed to set up and run a business such as a lawyer, accountant, sales rep, web developer, marketing agency, etc.
Each of these people on your team brings something different to the table, it’s essential that you listen to their advice on what needs to be done. Having a team, you can trust is crucial to the success of your business. Getting the right advice can save you from making costly mistakes now and in the future.
4. What amount of funding do I need to start?
Starting a new business doesn’t have to require a great deal of funding if you decide to bootstrap. However, it will involve some initial investment to cover startup costs. The key here is to work through your options and determine how much business funding you will need to cover not only your startup costs but also ongoing expenses before you are generating a profit.
Once you have an estimate in mind, there are several ways you can fund your startup, including business credit cards, lines of credit, vendor credit, a business loan, etc. You may find that a combination of these sources listed may work best.
5. What business structure should I choose?
The business entity you select will impact various factors from your business name, to your liability, to how you file your taxes. It’s essential to choose the right business structure when starting a business. Once you choose your business structure, you’ll also need to get a tax identification number and file for the necessary licenses and permits.
Want to know more about this topic? Contact me now.