Starting a business is far more than just coming up with an idea
Going into business is a serious undertaking. It requires far more than just coming up with a good idea, getting a license and trying your hand at it. Many businesses fail because some people feel that’s all there is to it. One of the purposes of the Saafenet Corporation providing you with free business training is to prevent the possibility you fall into that trap.
When you make the decision to become an entrepreneur, or someone opening a profitable business, the more information you have, the greater your chances of success. Therefore, here are several points you cannot overlook. It may seem like a lot of reading. But, what is presented here is a fraction of what you need to know to get started. review these basic principles to be certain you’re ready for this undertaking.
10 Principles you must observe
- Before you even get started you need to review the business survival rates not just for your industry but for the specific business you plan to enter. You must also pay close attention to things you need to avoid when opening a business.
- Be certain you understand the types of businesses you might be able to open. Though you may feel you have a great idea, you may need to adjust your impressions of the types of business you could open. Be certain you understand the differences between service, manufacturing and merchandising businesses. You may discover things you can do but never considered.
- When you think you have come up with a business that’s right for you, do some research. It may be the business you’ve been dreaming about, but you need to look for the path of least resistance. Don’t look for an easy business to start because few exist unless you have a lot of money to get started. Look for a business you can become passionate about, and then see if it has the potential to be profitable.
- Once you decide on a business you feel is right for you, make sure there is a need for your product and or service. Then develop a profile of your ideal customer. This is basic information you need to develop a niche. Without which there is little reason to start a business.
- Once you match the business with your first impression of your niche, develop a business plan. Keep it realistic, you may find your plans won’t work and you need to make changes. Stay flexible in your business planning.
- Well before you open, select the type of business structure for your company. To the extent possible avoid anything that might place your personal assets at risk, like proprietorships or partnerships. Learn everything you can about the form of business you settle on.
- As early as practical open a separate bank account for your business. There is no upside to putting all your money into one account when you own a business. It would be difficult to develop financial and management reports if you had to look at every transaction to determine the business and personal components. And, it would be even more difficult to run a business if you don’t know how much, or if you are even making money. It is far better to have separate accounts and to pay yourself a salary from your business account.
- Having settled on a business you feel will work and that you’ve planned, determine how you will finance your startup. You can borrow from a financial institution, second mortgage your house if you have some equity, or seek investors. All those options would, however, leave you in debt before your business earns a profit. If you quit your job, you must seriously consider how you will live and pay back your loans. A better option is the Saafenet five (5) step fundraising plan, It allows you to start without being in debt.
- The IRS allows you to deduct expenses you incurred while setting your business up. Be certain you have a structured way to track your expenses. Accounting software is your best option. If money is tight you may have to learn to use a spreadsheet.
- As early as possible, begin to promote your business. Starting before you open may be the best time, if you can create a sense of anticipation.
- Well before you open, determine if you will be able to start out at home. Location, is a one-time strategic decision, that is difficult to change. Even if you plan to expand later you must know what you’ll do the day after your grand opening.
Depending on your age group, take a look at how all this information relates to you.