11 things to do before starting your own business
- 1. Have a vision and business plan
- 2. Study your competition
- 3. Know your potential customers
- 4. Promote before you build
- 5. Develop a strong network with other business owners
- 6. Consider outsourcing and leveraging technology
- 7. Understand that starting your own business requires commitment and investment.
- 8. Estimate your startup costs
- 9. Decide on the right legal business structure
- 10. Find a mentor
- 11. Remember to have a strong work-life balance
Ever dreamed of starting your own business? But of course, you have! It is one of the most motivating ideas one can have, especially for individuals who are tired of the morning to evening job.
The idea of not waking up at 7 am and returning home at 6 pm, avoiding the daily commute, the possibility of endless profits, and being your own boss can be exciting. My friend is starting her own business in Minnesota and she can’t stop talking about it. She has been busy preparing for months and is all set to launch before the end of the year.
Deciding to start your own business is one of the best things if you want financial stability, but it can also be stressful. The first and most important thing my friend did was to research employment law in Minnesota. And she is doing this at the prepping stage before her business dream turns into reality, along with a long list of other things. I asked her if she would share her list of things to do before starting your own business and she said yes.
Besides the obvious things such as picking the right name for your business, choosing the right location, getting a tax ID, having a good accounting and bookkeeping system, hiring the right staff, protecting your intellectual property, business insurance, dealing with legal issues, finances, sales, marketing, liability protection, consulting a good attorney, building a great website, etc., here are 11 basic things to do before starting your own business that will ensure your success.
11 things to do before starting your own business
1. Have a vision and business plan
Obviously, you can’t expect to excel in business without a proper plan. This begins with developing a:
- Business model canvas
- Business plan
- Cash flow forecast
Your business plan is your blueprint to success. Ensure that you set goals to always keep you motivated and focused. According to research, entrepreneurs with a good business plan have lower chances of failure. Before starting her own business in Minnesota, my friend is ensuring that she has a plan in place to prepare her for all aspects of her business and make her more confident.
So, come up with a vision that keeps you on the path to success.
2. Study your competition
Your survival in business depends on how well you know the competition and come up with a viable strategy to get a good market share and thrive. Assuming you’ve come up with a great business idea for which there is a great demand in the market, make sure you analyze your competition, learn their market position, their pricing strategy, their strengths and weaknesses so that you can identify your own unique selling proposition or USP and plan your marketing accordingly.
3. Know your potential customers
It is vital to know your audience. Do a deep dive into the market and evaluate your target customer base before setting up your preferred business. Ensure your business can solve the problem they are facing before you start.
As a first step, write down all the problems or challenges your customer might be going through and come up with a list of solutions. This will give you a wide scope of what you can offer our target customers to come up with solutions to their problems.
- Is there a market or demand for your business idea/product/service?
- Who are your customers?
- Do you plan to keep your business local or expand nationally/internationally?
- Do you understand the rules and regulations involved?
Do a market survey to understand the size of your market, your market segments, the growth potential, your target customer’s buying behavior, the profit margins you can expect, and so on.
4. Promote before you build
The idea of building the business and then waiting for customers to come will not work, especially for startups. So, make sure your customer wants what you are selling or making. You might want to start with the following:
- Financial commitments
- Getting sign-ups
So, before you begin to sell your product your business, build your brand and market and audience so that they are ready to buy the moment you launch your business.
5. Develop a strong network with other business owners
People every day are starting their own businesses and facing the same challenges you are going through. There’s power in the community. Get to know and interact with them to make it worthwhile for your business growth.
Remember, peer learning plays an important role in doubling your profits. Attend business events to meet with like minds and exchange ideas about the business industry.
6. Consider outsourcing and leveraging technology
No one can do it all on their own. And you don’t have to! Outsource the things you cannot handle so that you can concentrate on what you can do well. Think of automating processes that can be automated. An example is dealing with email: rather than spending your valuable time manually sending out emails, you can automate the process.
7. Understand that starting your own business requires commitment and investment.
Starting your own business can be challenging and requires commitment. You must come up with a great business idea, the capital, the legal issues, think about hiring the right staff, be smart about time management, be flexible, and so much more.
8. Estimate your startup costs
Depending on the type of business you are planning, you’ll have to factor in the startup costs. For example, manufacturing or setting up your own factory will involve a substantial investment. If you are planning a retail business, you will still have to think about setting up an office. Then there’s the working capital you need to run your business. Think about inventory costs, supplier credit and the credit you may have to extend to your customers.
Whatever the type of business, make sure you have enough funds to cover you during the startup phase.
9. Decide on the right legal business structure
Experts suggest that it is better to avoid starting your own business as a sole proprietor as that can put your personal assets at risk. Instead, think of an S Corporation for tax benefits, or a C corporation if you plan to attract venture capital investors or an LLC. While entering into business contracts, use your corporate name at all times as your business is a separate legal entity.
10. Find a mentor
Marketing is possibly the toughest aspect of starting your own business. So think about having a mentor with experience in the market who can prove invaluable in your startup business. They can help you reach your dreams, develop better strategies, and open the doors for success. Look for someone who has been there, done it, and emerges a victor. Someone who can keep you focused and motivate you when you need it.
11. Remember to have a strong work-life balance
It is true that starting your own business means putting in all your energy and time into it to grow. But when spending most of your waking hours in your business can lead to burnout and you stop being productive. So, find ways to maintain the balance between your work and personal life.
It is so easy to get swept away in your busy schedule, day after day. Remember to have fun—recharge your batteries. Make sure you take care of your health.
The thing about becoming an entrepreneur is that even though you may have the education, most of your learning comes through your own experience. Anticipate issues and different scenarios by doing the research. Be ready with possible solutions. Prepare for success.