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If you are looking to start a business and are on the hunt for a few pointers and things to put in place, you are reading from the right source. We will break down the 10 most important things to consider when starting a business.
8 out of 10 adults wish to have a business set up by them, but only 4% of the newly started businesses manage to reach the 10-year mark. It is the nature of humans to want superiority, hence venturing out into things that will give them an edge over the next person.
The start is always hectic, with tasks more incomplete than complete. That is the reality of starting a business, proving the vitality for adequate planning. Whereas the end goal is to grow, it is imperative to have direction, directing energies to the right tasks at the right time.
According to Kapil Vaishnani, Founder - Chairman of Litmus Branding Pvt. Most people wish to have their businesses off the ground; however, for most companies that get started, only about 4% manage to mark their 10th anniversary, and only 50% manage to make it to their 5th anniversary.
There is no need to go around in circles when we can dive right into this 10-step checklist to transform your business from an idea generated at the ungodly hour of 3 am to a multi-national conglomerate.
10 Things You Need To Know When Starting A Business
1. Nature of the business
Before you draft a plan, you need to understand the industry you will be a part of. Reconnaissance is an essential part of the start.
2. Spin your business idea into a plan
You must be ready to go a step further than those who sing in their showers and imagine they can sell out an entire arena. So get out of your head and back up the idea.
No business can develop fully in the absence of a business plan. Writing a business plan can help you determine if your idea is feasible and provide direction. With a business plan, you will be able to know every next step that should be taken - Fred Chege
You ought to take a keen look through the requirements. You should have a business plan to guide you.
3. Identifying who your target customers
Do invest some time finding out your target audience and demographics. Then, all decisions you make as we advance from this will satisfy the needs of this target audience. Here, you'll determine whether your business will be a business-to-consumer (B2C) or business-to-business (B2B) enterprise.
"You need to clarify why you want to work with these customers – do you have a passion for making people's lives easier?" Desaulniers said. "Or enjoy creating art to bring color to their world? Second, identifying these answers helps clarify your mission. Third, you want to define how you will provide this value to your customers and communicate that value in a way that they are willing to pay."
It becomes relevant to start a business when you already know who your ideal customers are, where they are, what they do, what interests them, their most preferred social media sites, and probably their age. And perhaps you have to think about something that will pull their attention towards your product and ignore those of your competitors, yet they have similar or closely related products.
4. Location
Where you locate your business matters, you need to look for an excellent location where your audience will access your business. This will help you attract more and sell more hence more profits and more revenue for the company. Therefore, even online companies need a base of operations.
5. Have self-discipline
As an entrepreneur, you need to have discipline. This is one of the most challenging things to bear for most people/ entrepreneurs. Consistent in this department is hard, but you succeed if you can get along with it regarding discipline and handling your business.
Your business is your heart, so you have to give it attention and be at its center, meaning that you must manage it articulately and be accountable for it. This calls for setting business plans, looking for resources, keeping in the lane of your budget, setting goals and meeting them, dedicating time to your business and sacrificing for it, consulting, discussing, and having new ideas on how best you can improve.
6. Capital /financing
You can’t operate a business without money. Resources are determined by the kind of business you want to start. The size of the venture also determines the amount of capital you need, so you might be required to have funds to run you from the startup phase to the stage/ level where your business can finance itself.
You can determine how much money you need to perform a break-even analysis. The formula is simple:
Fixed Costs ÷ (Average Price - Variable Costs) = Break-Even Point
Capital is one of the most essential resources you need to consider and have before starting a business. Capital generating sources for beginners are usually past savings from previous jobs and businesses. Family and friends are generally a good source of initial capital. . It is advisable to have at least saved about 77% of the capital you need to start. Then you can get the rest of the capital in the form of loans, and these perhaps have to be short-term loans so that your business will be able to clear them once it gets started.
7. Labour and staff
You are not going to run the show alone. You are going to need some help executing some of the tasks. You won't be able to do everything alone. No man is an island.
I had a full-time job as I considered starting my own business in 2009, but I did a lot of groundwork before I started, and bringing on an accountant was an important step," said Sarah Burningham, president and founder of Little Bird Publicity.
"It helped me understand what I needed to do to make this work from a profit standpoint, the ins and outs of state, federal, and local taxes."
You will need people to handle customer relations and coordinate your business's marketing and sales plans.
8. Know your competition
It’s essential to find out and learn about your competition before you start up a business. Knowing how your competition operates gives you the luxury to observe what they are doing, develop it to suit your business, or avoid it if your target audience does not like it. Gaining market share and conquering your customers should be the number one thing in your thoughts to get your business started.
No matter how unique you might think your business idea is, you should be aware of competitors - Ian Wright, founder of British Business Energy.
9. Operational costs
One thing you should plan for before anything else and before getting your business started is planning for costs. These are commonly known as operational costs. You ought to determine all the expenses you need to cover, for example, rent, electricity, office requirements, salary and allowances, and many others. Most of these costs are monthly costs, and so you have to budget for them for at least to cover the first three months at the start of your business.
10. Branding And Advertising
To sell today, you need to build up your brand and get a following of people ready to jump when you open your literal or figurative doors for business. There is a lot of power of business in referrals and testimonies. A website would be vital to enhance your digital footprint and provide a backbone of answers about your business. In addition, social media can come in handy as a promotional tool. A CRM Software will help you store customer data and design how to reach out to them.
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