7 things to Consider When Starting a New Business
that 65% of new businesses fail within the first decade, and only 25% of them make it to 15 years. This highlights a significant failing in the foundations of a majority of these institutions.
A gung-ho attitude and a motivated spirit, while important, aren't the be-all and end-all when it comes to creating a long-lasting business. You'll need to understand your undertaking and what it entails. A strategic approach to the challenges on the ground will make all the difference.
If you're thinking of starting a new business, give yourself a fighting chance by mulling over the factors below.
1. Have a Business Plan
A business plan is what happens when a great idea meets practical considerations in the real world. These plans help you identify your business's potential strengths, weaknesses, opportunities, and challenges.
Before diving headfirst into the venture, create a brief business plan that highlights your proposed service or product, expenses involved, funding needs, potential customers, competitors, and any niches in the market. This will help convince potential investors and financial institutions of your business's viability.
If you don't know how to draft one, consult the SBA (Small Business Administration) for assistance.
2. Know the Competition
Every business owner should consolidate their efforts to gain a market share. It's the only way their enterprise will remain above water. Get to know your competition, their strategies, and any weaknesses in the services or products dispensed. Remedy their shortcomings to become a more attractive option in the eyes of your prospective clients.
3. Who is Your Target Customer
Do you know who your clientele is? Are you sure there's a demand or need for your service or product from the intended market? Will your preferred prices make financial sense to consumers?
If you can't relate with who you're selling to, your business may stumble before it gets the chance to take off. If you're expanding to a different location, get to know the purchase trends of the new market.
Questionnaires are an excellent tool to pick the thoughts of your potential clients. If conducted correctly, you may gather some vital information. Additionally, show up to networking groups. This human interaction will open up your mind to more customer insights.
4. Staff Make or Break Businesses
You can't do everything alone. Having a dedicated and efficient workforce on your side is a portent for success. Your recruitment team needs to have a well-thought-out employment criterion. Training of workers should be done faultlessly to prevent the propagation of incompetence throughout your business.
5. Are Your Finances in Order?
You have to spend money to make money. When starting a new business, research the initial costs you'll have to pay. You'll also need to have the overall capital in mind; however, if your business fails to leave the launch pad, thoughts of any future investing might prove premature.
As per Small Business Trends, the most popular way of financing small businesses in 2018 was personal funds. It accounted for 77% of the capital. Financing your fledgling business will eat into your savings, and this might not be enough. Sometimes, getting a loan is the only way to go.
Depending on your need, you may get a short- or long-term loan. You will need to read the fine print carefully. The terms and conditions through which you've been given your seed money matter a lot – think about loan interest rates, security interest, and the repayment terms.
6. Pick the Right Location
Where does the customer base interact with your products or services? Are you planning on running an online store? Will your endeavor require a restaurant-like setting requiring picturesque vistas, or are you, by large, an e-commerce entity?
Thinking about these questions will force you to consider things like whether you'll be operating from your house and if you have sufficient space to store and ship out your products. Although, if you'll require large equipment or are storing many items, then getting material storage might be a good option for you.
Because of poor marketing, many people with small to medium-sized businesses have difficulty selling their services or products to the intended consumers. According to CNBC, if you fully understand who your target audience is, then this shouldn't be a big issue.
How you interact with your business's expenses, returns, and payments, is a make-it or break-it dynamic relative to your small business's success. You'll need a banking partner that keeps things simple but effective, maintaining minimal transaction costs.
By these criteria, WireBee is a small business owner's best friend. You'll be able to seamlessly schedule or send payments, pay bills hassle-free, integrate your accounting software fluidly, and automate AP and payment processes.