Posted on: 25/04/2022 by: Kyle Phillips in: Management, Planning, SMEs, Startups
Have you ever had thoughts about whether or not you should turn your hobby/passion into a potentially profitable business? It’s fair to say that most people would have had these thoughts at some point, I know I have! Today I am going to be going through 8 important questions to ask yourself before considering starting a business of your own.
What is the core motivation for starting your own business?
At the beginning of this whole process you’re going to have to ask yourself if you really want to start-up and run a company or not. As most know the first few months of a start-up tend to be really stressful and can also strain your finances, so it’s important to weigh everything up and evaluate your life and see if you’re going to be able to manage it. It’s not all doom and gloom though as if you have a true passion and love for your service or product, which will most definitely shine brighter than the sleepless nights and grey hairs! To sum up: make sure you are actually interested in your product before beginning anything. Some of the biggest companies were founded through love and passion for the product, including Fender, the manufacturing company most known for making guitars.
Are you business owner material?
Don’t quit your day job just yet, there are still a few questions you need to ask yourself such as; Do you have what it takes to run a company? Are you willing to sink the time into it and invest a lot of your own money? If so, you will need to take around seven to eight months to; plan and develop your product or service, try to contact potential clients, create a look and brand, and develop a website. While doing this make time to learn as much about your target audience as you can and also make sure you have a decent amount of savings. Save, save, save, and save, having funds to fall back on is a must need for starting a business. If you do all this, it will be worth it. Yes, it will take a while and a lot of hard work but being well planned and having everything thought out and pre-prepared is needed to successfully start a business.
Do you know your target audience and your market?
Finding your target audience is essential as you need to know who you are going to sell your product or service to, otherwise you will just be throwing mud at the wall to see what sticks. Determining the demand of your business comes a lot smoother once you have your customer base in mind. Find out their; age, location, and whether or not your product or service will benefit them in any way. Once you have sorted out what your target audience looks like you will need to get friendly with your market. Ask yourself: Are there any trends within my market? Try looking on social media or on websites for trade publications to see if anything sticks out! Once you find out that valuable information you can see what you can do to stick out from the crowd and offer the market something new that interests them. You can also do some research by testing out your product at local markets or by sending it out to people who have a slight interest in testing it out!
Website! Website! Have you got a website?!
These days if you don’t have a website then you probably aren’t going to get far, but everyone knows that! You are going to want a professional looking website that exudes your brand's personality at every turn. Having a website that runs well helps as people tend to click off pages that don’t run quickly. Furthermore, having different sections is a great shout. For example, having a blog section can help gain traffic on your page as some people are interested in ready information about specific interests, which could very well be your product or service!
Business plan? Has anybody seen my business plan?
Having a business plan will be your way of seeing how your business is doing. A bonus is it will also help you attract investors or maybe even help you secure some level of funding. (Funding for start-ups is really important and if you want to read more information about it go on the Business Butler blog section and read my latest blog about it!) A business plan will typically include a base level description of your business, your business’ goals and targets, and also an overview of your market, target audience and your competitors. You should also have your company’s marketing strategy and any financial forecasts that have been made. Having a solid business plan is a must and can be beneficial.
What about finances?
Have you got your finances in order? Do they all make cents? Sorry, that was bad… Research has shown that 60% of small businesses fail within the first five years of starting. A lack of cash flow is the usual downfall to most start-ups, which is why securing funding can be a big helping hand. Make sure to save and try to set aside at least five to seven months’ worth of living expenses before thinking about working on your company full-time and quitting your day job. Calculate and note down every cost that will be made, you need to think about whether or not you need to buy equipment, how much you will need to develop your product, will you be renting an office or a space, how much would the bills be? Everything needs to be accounted for. Hiring an accountant who can do your finances for you would be a huge help as they could also tell you what expenses you could claim back for equipment and other such things.
Funding for your business, what’s the plan?
I recently wrote a blog all about the importance of funding for start-ups and SMEs which is on the Business Butler blog section. Funding can be extremely important when starting a company as the first few months can be extremely hard and straining. Having backing from funding by perhaps securing a loan or an investor can help the longevity of your business. Some banks such as the British Business Bank offer loans up to £25,000 and also offer support, mentorship and advice. It is important to look into securing funding for your company at the beginning and it will most definitely help. Furthermore, it will be better than burning through all of your savings!
Marketing and promotion?
When first developing your product, brand and business in general you should start to consider creating a marketing and promotion strategy plan. Like with any business you are going to need to promote your product or service as much as possible to gain any interest and traction with your company. Make sure your website is slick and can be accessed easily, depending on what sector your product is in you can promote it in many different ways. Utilising Instagram and its advertisement boost feature can be a great way to help brand awareness. Establish your company’s presence on all platforms; Google, Facebook, Instagram, Yelp, Website, and LinkedIn.
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