What are the key things to consider when starting your own business?

Starting your business

Growing your business is even more challenging so it’s important you start up for the right reasons, as these will be the key to developing the skills and tenacity, which will keep your business running – and when the time comes, expanding and developing your ideas.

Start your business for the right reasons

Be honest with yourself: If your reasons are, ‘I want to make a lot of money’ or ‘I want to have more time with my family’ or because ‘I don’t want to answer to anyone else’, you need to think very carefully.

Excellent reasons include:

• I have a passion for what I will do and I strongly believe, based on my research, that my product/service will fulfil a real need in the marketplace.
• I have the mental stamina to cope with the potential challenges and the drive, determination and patience to succeed.
• I thrive on independence and I’m skilled at taking charge when a creative or intelligent solution is needed.

Know your needs

Recognising your training needs and seeking support is crucial. New business owners often lack relevant business and management expertise in areas such as finance, purchasing, production, marketing, recruitment and managing employees.

Poor management is one of the top reasons a new business fails. Successful business people need to be good leaders, skilled at motivating themselves and their employees.

Neglect of a business can also be its downfall. Business owners and managers need to organise, plan, control and review all activities/operations. This includes continuing to study the market and customer data and responding quickly to market changes and you may need help with this.

Capital

A common and fatal mistake for many businesses is having insufficient operating funds. Forecasting unrealistic revenues from sales and underestimating cash flow needs are also common.

You must consider not only the costs of starting a business but the costs of staying in business and there is lots of support and advice available on accessing funding and raising capital.

Location. Location. Location

Location is critical to the success of your business. A good business location can help a struggling business to survive and ultimately thrive but a bad location can mean the end to the best-managed enterprise.

Consider:

• The type of space required
• Where your customers buy and where your competitors trade
• Local incentive programs for business start-ups in specific targeted areas
• The area's receptiveness to a new business and the community support
• The cost of your premises

Planning is vital

No matter how large or small your enterprise is, it is critical to have a business plan – and get the right support to help develop this because it’s just as important as your great idea.

Your business plan needs to be realistic and it absolutely must develop with your business – don’t create a plan at ‘start up’ and put it in a drawer, never to see it again.

Your business plan maps out your vision and objectives for your business. It will keep you on track and on target and it needs to change as your targets and ambitions change.

Rapid expansion

A focus on slow and steady growth is best but often a rapid expansion can seem the only way to cope with sales.

An ideal situation is to wait until your company has established a solid customer base and a good cash flow before you push on with major growth.

This will give you stability and will ensure you have the right systems and people in place to succeed. It will also help with re-financing, attracting investors or applying for funding, should you need to.

Must-haves

Must-haves for success are a good business plan, a marketable product or service and boundless enthusiasm.

When things get tough remind yourself why you started your business and use your business plan to stay on track.

Keep going. Keep smiling and remember, you’re not alone.