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Starting your own business can be intimidating, with seemingly countless areas to cover in a set budget and timeframe. Arguably the most important stage of starting a new business is the beginning, when it’s possible to plan ahead for most scenarios while prioritizing the truly most important areas. Good planning in the early stages can prevent countless mishaps from occurring later on; prudent planning builds a solid foundation for any motivated and committed business.
So once you have a business idea that you’re confident enough about to set in motion, where should you start?
1. Recognize the Process as a Definitive Career Change
Before anything, it’s important for any prospective business owner to verify their goal in starting a new business is to advance their career. A strong drive for career advancement and general enthusiasm for their prospective business’ niche are typically two characteristics of all successful business owners. As a result, it’s important to recognize this career move as your new primary priority, as long as it’s with the aforementioned intentions in mind.
2. Confirm Your Passion for the Topic
It’s essential to scope out the industry into which your prospective business fits. Then, get a hold of any resources you can find that are relevant to your industry. This includes reaching out to those experienced and knowledgeable in the field. If possible, ask to shadow a business owner in the respective industry for a day or at least a few hours.
If that’s not possible, scour the web, your local library, or any relevant industry associations (try the directory here) to learn all you can; if you’re still interested in the industry after extensive research, it’s likely a good fit.
3. Consider the Competition
At least at first, consider your competitors a learning resource, not a rival/enemy. Aspects like pricing, specials, services and predominant demographics vary from town to town and state to state. By analyzing the most popular businesses within a niche, you will likely discover what works (and what doesn’t) from a business perspective in that specific locale.
4. Envision the Worst-Case Scenario
Let’s face it: The majority of businesses fail. Still, with the proper planning and commitment, your business could absolutely succeed. It helps to gauge your own commitment by envisioning the worst-case scenario. In that sense, never invest all your funds into a business. Always have money in the bank and ready to spend in case of an emergency, as all new businesses experience a hiccup here and there that result in an unexpected expense. If you are unable to pay those, your business could go under.
5. Set a Budget with Your Finances in Mind
If you can’t start a new business without emptying your bank account, then it’s not a good time to begin this process. Instead, be patient and keep growing your finances until you have enough to build your business comfortably with a decent enough emergency fund, which will be used at some point in most cases. Or, look into other options such as investors and loans to see what’s reasonable for you. To figure this out, you’ll need to start a business budget. Figuring out your finances has to come before making money, or else you’ll never succeed.
6. Go Over Every Area of Finance
In order to attract investors and interest in general, it’s essential for business owners to be highly aware of their financial situation. While some businesses do fine without initial investors, it’s important enough nonetheless to examine your finances and compare them to projected business expense. Also look into whether you’ll need a small business loan or need to account for any legal fees by operating/opening the business.
7. Separate from the Pack
At this point, you should be well aware of your competitors — who they are, how successful they are and their strengths and weaknesses as perceived by customers. Now, it’s time to form a strategy as to how you can stand out among the competition.
Consider how you can somehow replicate their strengths but in an original way that makes it even better. When examining competitors’ weaknesses, ask yourself what occurred for that area to become a weakness in the first place and strive to avoid that with your own business.
8. Choose the Right Name
A great name can either come to you naturally or it may take months or even years to deliberate on. Either way, it’s important to aim for a name that’s easy to pronounce and remember, in addition to one that hopefully highlights the business’ niche in a clever way. While a business doesn’t have to tout a catchy or wonderfully creative name in order to be successful — there are plenty of businesses with boring names — it certainly helps one stand out from competitors.
9. Cut Corners Wisely
When assembling your business budget, consider cutting areas you can do yourself. For example, if you took a few marketing classes in college and are adept at sending out emails and generating press, it may make more sense to do PR and marketing in-house as opposed to hiring a pricey firm. Try to stay in-house whenever it makes sense, but also be sure not to put too much on your plate; your main priority is running the business, after all.
10. Assemble the Legal Structure
Before your business’ doors are open for business, it’s exceedingly important to have the business’ legal details sorted out. Namely, paperwork should clearly identify the business owner as well as specifying the role of any investors. There are many other areas to consider too, like personal liability, business tax information, and ownership structures (partnership, LLC, proprietorship, S Corporation, etc.). This area varies from business to business, so it’s recommended to consult a lawyer to confirm your new business’ legal standing is sound.
11. Get Prepared for 7-Day Work Weeks and Long Hours
Being the owner of a new business will be extremely time-consuming, especially at first. Don’t be surprised if a new business takes up the wide majority of your time to begin; your leadership will be essential as employees and customers alike become familiar with the business’ inner-workings and presence. It will be difficult and time-consuming at first but with prudence and dedication, starting a new business will be well worth it in the end.
Guest post written by Sarah Landrum.
Sarah Landrum is a freelance writer and the founder of Punched Clocks, a site dedicated to helping women navigate the work world and find happiness and success in their careers. You can find her dishing out wisdom on all things career related online on Twitter | Google+ | LinkedIn