Branching out on your own and starting a business is a scary thing. Whether you’ve funded the endeavour yourself or taken a loan, whether you’re working alone or with a small team… there’s a lot of money and at least one person’s livelihood on the line.
Don’t let this scare you off though! Starting a business can be hugely rewarding and it may well be the best thing you ever do! Let us give you a few tips to help you get started. We’ve got your back!
1. Start Strong
Starting a business can be difficult and very risky. It’s easy to throw all of your time and resources at it, but starting off on the right foot makes all the difference. Before you can get going, you need a plan.
The first step is figuring out what type of business you’ll have. Will it be a corporation? A partnership? An LLC? A sole proprietorship? Once you’ve got your head around this, you can really sink your teeth into planning. Having a written plan with projected results and business goals is a great way to make sure you’re staying on track.
Putting together a concrete business plan will help you put your ideas in concrete terms and help you identify where you might need to change your model. Focus on answering questions like how and why your business will be operationally and financially successful. What customer problem or hole in the market are you solving?
Whilst making your business plan, you’ll also have to do lots of competitor and market research. You don’t need to be the first business to bring your product to market, or the only business of your kind, but having a niche is important. Research the demographics of your customer base so you can get to grips with their buying behaviour. Watch competitors online (both their sites and their social media) and talk with similar businesses too.
Having all this info built into a business plan will help you hit the ground running and have all the answers you need.
2. Start small
Starting strong is all well and good, but make sure you don’t go too big too soon. If possible, self-fund your business for a little while before applying for funding.
Going all out too soon is a very good way to overextend both your cash and your time. It can be very exciting to make sales and have some cash flow, but make sure you don’t spend it all on business improvements right away. Sure, you have to spend money to make money, but building savings for a rainy day is more important to start with.
If you find yourself super tempted to use your new found pennies to advance your business, then that’s fine, but make sure you have enough to fall back on so your new business doesn’t fail at the first hurdle due to lack of funds.
3. Protect your people
If there are other people involved in your business, how are you taking care of them? How are you ensuring they have job security and a pay cheque in their pocket at the end of every month?
If your business is just you, what would you do if you got sick? How are you going to keep your business running if you’re too sick to get out of bed?
The good news is that there are insurance products there to protect you from every eventuality, and they’re worth having a serious think about. One of the most sensible insurance policies for self-employed small business owners is income protection. This is personal protection rather than business protection, and it does what it says on the tin: protects your income.
Basically, if you were to get seriously sick or injured and signed off from work as a result, your income protection policy would pay you a percentage of your income every month (usually 50-70%) until you were back on your feet. The need for this type of protection is self-explanatory for anyone branching out on their own and counting every penny.
There are also ways you can offer various life insurance or protection policies to your employees as a benefit through your business, so if you have staff, protect them too.
4. Know the numbers
As the head honcho, you’ll be making a lot of decisions on the fly. But you won’t be able to make these decisions if you’re not regularly getting acquainted with the nitty gritty of your business: the numbers.
Having a good grasp on the numbers will help you always understand how your business is doing and how you need to operate better in order to bring in more moola. You need to be on top of the figures from the get-go, and if you can’t wrap your head around them then you’ll need to hire someone who can.
The numbers include your start up and day-to-day running costs, as well as sales, cash flow, projected profits, and much more – depending on not only the nature of your business but also on how you define its success.
5. Follow your bliss
Striking out on your own and building a business from the ground up can be lonely and exhausting. There may never feel like there are enough hours in the day to get the work done, let alone have a work-life balance.
From the wins to the losses, you have to be motivated by passion at every step of the way. If you’re not passionate about what you’re doing, it’s easy to pack it in at the first sign of trouble. In order for your business to be successful, you have to be invested in it. Starting a business can be really hard at first and it can take a while to see a profit and real cash flow, so you need to be in it for the love of it if you want it to last.
What do you think are the most important things to consider before starting your own business?