Thinking about starting a business ?
Tips for understanding your needs when starting a business
When choosing to start a business consider your strengths and weaknesses. Pick something you are interested in and enjoy doing. In the start up phase long hours are going to be involved especially in the first six months. Knowing long hours will be involved it is wise to pick something you enjoy.
My father who made a living being in business had a saying which was "what do you want and what are you willing to give up to get it". This fits right in with starting a business. You have to be willing to give time and lots of it, this will take it from other things you might want to do, Another which I am sure isn't personally his was "It takes money to make money." In his life the most important "Give a customer what they way and they will give you what you want." Using these sayings (and a lot more) he made a living running a small business.
Service business considerations
When starting a service business you really should know if you have the strength and stamina to provide this service taking into consideration the long hours. It should also be something you have an interest in because you will be doing the same thing, for different people, day after day.
For any kind of business good communication skills and phone manners are important. If you want people to take you seriously you have to find a way to get things spelled correctly. Use correct grammar, do some editing in your correspondence, and use courtesy when on the phone.
Book keeping and accounting
Book keeping and accounting are important factors which you should learn about if you don't already know. A good filing system is also a must. You don't have to be an expert in these fields. Some knowledge of them however is important.
Don’t forget the tax man
If you make money too much money too soon, he’s going to take a big chunk of it. The rule of thumb is, you should show a loss for the first two years. If you start making too much money look at things your business might be able to use in the future and purchase them. Your accounting and filing skills are important in this area, they will really help when you file taxes
Don't be afraid to ask for help
There are people and think tanks who mentor small business owners, and if you need them don’t be afraid to use them. A simple internet search of community colleges should bring up at least a few, Make sure whoever you decide to use know what they are talking about. There are very few people who know everything.
Research your product or service
You want answers to these questions.
*Are there enough people who want what you are offering?
*Is there going to be competition?
*If not why not?
*If not, is there really a market for what your selling or the service your providing?
*Is there going to be enough interest for your service or product?
*If you are competing against others is there something slightly different you can offer to entice people to use your product or service instead theirs?
Pricing your product or service
You want to make money, so your price can’t be too high or too low. You have to factor in all costs, if you don't you might find out your working for less than you could make at a nine to five job. If you have competition check their prices, then look for ways to decrease your bottom line.
For services, costs for supplies, transportation, vehicle breakdowns, insurance, and hours.
For products, the entire cost of getting the product to your home or business, storage, and possibly shipping costs, For both, book keeping time, advertising costs, and taxes.
If you have a store front, utility costs, rent or payments, and extra hours cleaning or paying someone else to do it. Once you have these costs break them down as far as you can.
If you are selling an entirely new product, remember someone will see what you are selling and change it slightly giving you competition soon enough.
Tax identification numbers
Now you are ready for your EIN number and state tax identification numbers. With these a decision which is whether or not to Incorporate, and if so where.
When you start a company you are personally liable unless you use and limited liability company set up or a corporation. For most companies a limited liability set up will be the best. It limits what personal assets creditors can collect if you fail. Incorporation limits your personal liability although for small businesses it comes with a healthy price tag, part of which is filing taxes. The most inexpensive price for having your corporate taxes done, you are likely to find, is around five hundred dollars.
Your Brand and Branding
Branding is not as simple as most people believe. There are those who would tell you; create a logo, use it in your advertising and your done. Your brand lets clients and customers who you are and what you stand for. The brand design will show in all your advertising, however is not limited to it.
Advertising is important, word of mouth is good but probably not going to send enough people your way . From day one word of mouth is important as satisfied customers are likely to tell friends about you. What was effective even a year ago is not today.
Today the internet is the best place to advertise. You want to make sure whatever you do is reachable by mobile internet devices. At this point in time mobile websites are the simplest to optimize, this however will not remain so. For local businesses paying for advertisements on a first page of Google can be cost effective. Google is the most used search engine available. If your capable of doing Videos and it somehow fits your business model, youtube is the second most used search engine.
When starting a business it is important to remember the basics
In a business you are not the boss. Your customers decide the value of what you are offering. Instead of pleasing a boss and customers you are now entirely responsible for how your customers feel about your product and your business.
There is going to be a time investment. Using the time equals money factor a decision has to be made. How much is your time worth? Are you going to be paid for your time at a future point also has to be a consideration. There is also going to be money involved. Every business which exists for over a year has invested money in it.
There are businesses you can start without a money investment, however at some point in time a monetary investment is going to be necessary. If you haven't planned for it chances of success are slim.
© Up dated May 5, 2012 Dennis Thorgesen for Lisech eMarketing, All rights reserved.