This is a guest post courtesy of Brian.
Starting a business can be as difficult or as easy as you want it to be, it’s all in how you prepare and perceive it. Below are some tips to consider before jumping in whole hog.
If you’re thinking about starting a new business, you’ve probably already heard the statistics.
According to the Small Business Association:
50% of small businesses fail in their first five years.
Most people assume that poor ideas and/or poor management are to blame. But in many cases, it’s actually nothing more than poor preparation.
Make no mistake, what you do before you launch is just as important as what you do when your business is actually up and running.
Should you find yourself on the brink of starting a new business, here are eight things to do first.
Save as Much Money as Possible
If you’re confident about an upcoming business venture, the urge to get it off the ground can be almost overwhelming.
Unfortunately however, rushing into things before you’ve saved enough money is not how you get your business off to a good start.
If you’re short of cash now but expect the situation to change in six months time, wait it out.
The more money you have behind you, the better your odds of success.
Needless to say, more money also equals more room for error and therefore less stress.
Borrow if You Need to Borrow
Speaking of money, if you need third party financing, don’t be afraid to go out and get it.
Most entrepreneurs would prefer to start their business without borrowing money.
After all, there’s nothing like a big pile of debt to make a risky decision even more stressful.
Unfortunately however, if you need financing, there’s no getting around this fact.
And it’s better to start a successful business with some debt than an unsuccessful one debt free.
Develop a Business Plan
If you want to borrow money, you’re obviously going to need a business plan.
But even if you plan on self financing, it’s still worth creating one.
Sometimes the actual act of developing a business plan can be even more valuable than the resulting product.
When done correctly, creating a business plan can force you to ask and subsequently answer key questions about your businesses viability.
And not insignificantly, even an informal business plan gives you a direction to move in and a target to hit.
With no direction, you’re essentially spinning your wheels and going nowhere.
With no target to hit, what’s the point of shooting?
Find a Mentor
If you’ve never started a business before, you can expect the first few months to be a whirlwind of stressful emotions and tricky decisions.
Having access to a mentor during this time period can prove invaluable.
Put your networking hat on and start talking to other entrepreneurs and small business owners in your area.
Find people with experience who can guide you through the murky waters of first year business ownership.
Learn the Basics
You don’t need to go to business school to successfully start a small business.
If you want to increase your odds of success however, there are a few key things that are well worth educating yourself about.
Basic accounting skills are one, search engine optimization is another.
You also would do well with a little knowledge of marketing, branding, and positioning.
Night classes are certainly an option but even regular trips to your local library can send you moving in the right direction.
And of course when all else fails, if you have the capital to do so, you can hire folks to pick up the slack in your weak areas, so you can focus on your strengths.
Study the Competition
Make a list of your biggest competitors and learn everything that you can about them. The more you know about them, the better equipped you’ll be to compete.
One of the easiest ways to determine a company’s strengths and weaknesses is to simply become one of their regular customers.
Find out what they’re doing right and more importantly, what they’re doing wrong.
Look for ways that you can better their product or service, or fill a missing gap.
Come Up with a Marketing Plan
Your marketing strategy can make or break your new business.
It’s therefore well worth trying to come up with ideas long before you open your doors.
Assuming you’ve already identified your target market, which you should have, focus on them exclusively.
Don’t waste time targeting those who will never purchase your product/service anyway.
Needless to say, preference should be given to free marketing methods such as email and social media, at least until you have some successes under your belt and the working capital to experiment with other methods.
Choose a Great Name
Finally, we have the small matter of your businesses name.
Biggest tip: don’t rush into choosing it.
Re-brands are expensive and cumbersome. Your choice of a business name is likely to have very long term implications, so take your time and choose well.
Ask yourself what your name needs to say about your business.
Choose something memorable but also relatively self-explanatory.
Always keep in mind that your businesses name (usually coupled with your logo) is going to be the first thing that customers see. Make it count.
Over to You
Ready to take the leap and start your own business? Do you have a plan in place? Have you saved a little nest egg? Do you have lending options there if you need them?
Not to discourage you if you don’t, a business can still be started regardless, but having the above things in place will certainly make your journey easier and ultimately successful more quickly. Share your experiences in the comments below, we’d love to hear ’em.