When you are starting your own business, you don’t need to have everything worked out from the get-go. In fact, it’s impossible to have your entire business planned out for the entirety of its life from day one, but it is important that you have a basic business model and understand your goals – the rest will come in time.
Starting up a business can be a very big challenge though. There are plenty of would-be entrepreneurs who sit on the fence and are unsure whether or not they should take their first steps into the world of business. But, the best way to truly gauge whether or not your business will work (or indeed whether or not it is right for you) is to just jump right in and get going.
Though, before you do this, there are some key questions which you should ask yourself and think about. The obvious question of “Should I start a business or not” does not really count, because, if you have a viable idea for one, the answer should always be yes! Not all business ideas are created equal, however, and some start-ups have a higher likelihood of failing, such as restaurants and businesses in other crowded industries.
How unique is my idea?
If you are entering a crowded industry where there are lots of competitors all offering the same or a similar product or service, you have a smaller chance of success. The best way to succeed in the world of business is to have a unique product or service which is new or has some form of the novelty factor.
This question is also important because it can also help you figure out who else is doing what you’re doing and operating in your industry. You can’t play the business game if you do not know who the other key players are; just because someone else is out there manufacturing a similar product does not mean you shouldn’t also do this. But, you need to know who your competition is so that you can fine-tune your product and offer something better than your competitors.
By thoroughly researching your industry and its market, you will be able to figure out exactly who and what you are up against and how to differentiate yourself from the crowd. The more you stand out, the more interested people will be.
How much money do I need?
You need to know exactly how much money you need to get started and make sure you have this and then some. It is no good spending all of your money on getting your business going and then having nothing left to put into your day-to-day operations. The amount of capital you will need to get started will vary depending on what your business is, whether you sell a physical product and whether you trade physically in a store or online only.
The best method when starting your business is to use whatever money you can spare in the beginning to get it going, and then use as little funds as possible to grow at a steady pace organically. It may be tempting to plow thousands of dollars into social media marketing and open a physical store from day one, but this will just eat up funds you could otherwise invest in other areas. Do you really need to have a physical store from the very beginning? Probably not, because you will need to build brand loyalty and identity before you can make a success of one.
When starting out, think about what you need to get going and to operate in the first few months and only spend on things which are absolutely necessary.
Who is going to manage my accounts?
One mistake many start-up entrepreneurs make is to disregard the usefulness of an accountant’s services for a young business. You will be very busy running your business and scaling it up in the early days; it will, for the most part, be a one-man operation. With this in mind, can you really spare the time needed to manage your company accounts?
Managing your accounts properly and paying your taxes is very important and there can be serious repercussions if you make mistakes or forget to do it. By hiring an accountant, you can avoid silly mistakes which could cost you more than the costs of taxes and an accountants’ fee combined.
You should hire a reliable accountant who can keep on top of your company’s finances. Not only can accountants do this, but the best accounts have years of experience in your industry and can help you out with many other things, including the actual setup and attracting funds.
Is now a good time to start?
This is more of a personal question than anything else; it is always a good time to start a business from a commercial point of view.
Are you ready for the challenges which lay ahead and are you financially stable enough to see yourself through the possibility of spending a lot of your own money on your company with the possibility of minimal returns for the next few months or more? If your answer to this is no, then you may want to save up some more cash and come back to the idea at a later date.
Additionally, do you have enough time and are you in a comfortable enough position to focus all your efforts on your company? These are all key questions to ask yourself.
Can I go it alone?
Depending on your business, you may very easily be able to manage your company by yourself whilst it is in its infancy. For some, though, this is simply not a viable option and you will need to bring on some staff to help you manage your business from day one. If this is the case, consider which members of staff are going to be integral to the early success of your company and bring them on board.
If you are aware that you will not be able to manage on your own and, despite this, do not take on staff, you will find yourself struggling a lot and this can have significant repercussions on your company’s early success.