If you’ve ever thought of setting up your business, you’re not alone. The number of small businesses in the US has increased by nearly 50% since the early 1980s, and it’s not hard to imagine why that might be the case: the possibility of higher earnings, a better work-life balance, and the chance of ‘success’ (whatever it means to you) are all powerful draws. So, perhaps you’re dreaming of sending out those invoices, watching the money roll in or even writing out those all-important checks that keep your business running. But not so fast. There are a huge number of steps to be taken before you get to start seeing the dollars mounting up, and it can really pay off if you tread carefully in the early days of setting up a business. Here’s where to start if you’re going to seize the day and get your start up off the ground this year:
What’s your ‘why’?
First, you’re going to need to figure out why you want to set up your business. This might sound dangerously like something you’d be asked by your psychiatrist, but figuring out your ‘why’ will actually stand you in good stead. That’s because it will keep you focused, committed and disciplined enough to continue to persevere with your idea when times get tough. And times certainly will get tough: more than 95% of small businesses will fail within the first five years, which means you’re going to need something fuelling your desire to push through the problems and be one of the few that make a success of it.
Is there a demand for your idea?
Next, you’re going to need to do some market research. Even if you can keep a level head and look objectively at the market, your passion for your idea runs the risk of clouding your judgment and pushing forward with a business that simply won’t work. So, figure out who your target customers are, where they are, what they want and what they can already access. This will lead you on to identifying your competition, and figuring out where you fit into the picture.
How are you different to the competition?
Figure out the ways in which you’re different to your competition – it’s the only way you’re going to have any hope of standing up against them. This will involve doing extensive research and figuring out the types of customer they’re going after, what services they’re offering and how they’re funding everything. Pick up their marketing materials, ask for trials of their services and put yourself in their customers’ shoes – particularly if you want those people to be your customers. Talk to their customers to find out their pain points, and focus in on these while you’re developing your business to ensure you’re alleviating those frustrations.
Are you prepared to change course?
Finally, setting up a business means knowing which trends to follow and which to avoid, and a willingness to put what the business needs ahead of your own ego – which might occasionally meaning changing course for the greater good. Are you able to walk that often-difficult line? It’s essential if your business is going to succeed as, despite hours of work (or perhaps even years), you’ll need to be willing to change course if the market or other circumstances suggest that your current approach isn’t going to work.
Those are just a few things you need when you’re setting up a business. Do you have what it takes?