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Have you ever thought about opening your own business in 2017? I bet it has crossed your mind a time or two. Opening your own business can be a trying task and has a lot of moving pieces. We understand how daunting it can seem and we know why countless people never take action on their dream of owning a business. We are on a mission to support as many individuals that want to open a business as possible, so we have laid out a 12 step guide to keep you on the right path. Read below to learn how to start a business in 2017.
Do you have a particular area of interest in mind? Or do you have a certain skill set that you want to utilize? While these both help, they aren’t a necessity. It is possible to own a business around a subject you don’t have experience with, but you have to do your research and make sure you have the right people to help you.
How Much Money Will You Make?
Have you thought about the amount of money you would like to be making by owning your own business? This is important to consider because it will dictate how much revenue your business needs to bring in to meet your goals. Having these numbers in advance will help you with the rest of your planning process.
Is now a good time to open a business?
It is hard to know when it is a good time to start a business. This varies by industry and by niche. It also varies by trends and fads. Knowing when to catch them is extremely important. Opening a business surrounding a fad is likely not sustainable but not impossible.
Another consideration here is where you are at in your life. Do you have the time, energy and focus required to start a business? Starting the process of opening a business when you aren’t ready can add extra pressure and will make the experience less enjoyable.
The planning process will help you determine whether you are ready to start a business or not. It is important to remember that the timing is never going to be perfect. Don’t hold back on your dreams because not every piece fits into alignment. Take your time, do your research and put a plan in place and you will be off to a great start.
How big is the industry you are entering?
Understanding the size or your market and industry is an important piece of your planning. How many potential customers do you have? Where are they currently spending their money? Â
A few things you will want to consider when doing industry research:
How much should you charge for your products/services?
Some new business owners get lost when it comes to choosing a price for what they are offering. Many end up picking a number blindly and hoping for the best. Proper planning will help you determine these numbers. For example, knowing your cost of goods, your shipping costs and your overhead will show you how much you need to bring in, in order to be profitable.
Looking at the services and products of competitors is another factor to consider. You don’t need to stick to the same pricing by any means, but it will show you what people are willing to pay. Depending on how you want to position your business, you can choose to go higher or lower.
Price reviews should be done quarterly to ensure that you are still able to cover your costs and make a profit. Understanding your profit margin will also allow you to plan better for promotions or discount situations.
Why do businesses fail?
Business can fail for many reasons, but there are a few that are the most common.
The first reason is a lack of a clear and concrete business plan. In some cases, a business plan is made but then tossed in a drawer never to be seen again. Your business plan should be the foundation of your business and should guide you along as you go. Â Without a plan, your business can easily forget important pieces and can get off track quickly. Corrective action is a lot more difficult that proper planning.
What is involved in a business plan?
Business plans typically have these sections:
1) Executive Summary
2) Company Description
3) Products / Services
4) Market Analysis
5) Strategy and Implementation
6) Organization and Management
7) Financial Plan and Projections
How much does it cost to open a business?
No business is the same and that means that costs can vary greatly from business to business. A home based business generally speaking costs much less to run than a brick and mortar location. By creating a business plan and taking into consideration all of your needs, you can begin to calculate the costs of starting your business. Joining a community like the Startup Jungle community will allow you to ask other business owners questions about how to save yourself some money and tips and tricks from other business owners in your market. Similarly, you can also give tips and advice as you learn.
Costs to consider:
6 Tips to keep costs down:
1) Have a business plan
2) Source used equipment if possible
3) Consider co-sharing a workspace
4) Review your suppliers for inflated expenses
5) Consider non-monetary bonuses for employees instead of raises
6) Outsource administrative positions where possible
How do you know what would sell best in your business?
Perhaps you already know what products or services you are going to offer, but maybe you don’t. Depending on your type of business, you can offer complementary items. The reality is that you are going to have to spend money to acquire customers, so maximizing the revenue from them will be the key to your success. Offering other products and services will help you here if you choose them correctly.
Check out the video below from Perry Belcher, a successful serial entrepreneur and learn the sneaky little tricks behind growth hacking your business.
Where should you open your business?
Knowing where to place your business is important if you have a physical location. You don’t want your customers to have to go out of their way to find your location, so do the best you can to put yourself in their path.
What do you need to consider when choosing a location?
What equipment do you need to open a business?
Putting together a business plan will allow you to see the majority of your equipment needs. To start the process you will need a computer, a phone and an idea. From there you can decide on your business type and begin to research what you are going to need. For example, do you need a cash register? Do you need furniture? How about food service equipment? Knowing what you need and having a budget will help you keep your expenses down. Refer to the list above of tips on how to keep startup costs down.
How to Find Suppliers
Establishing reliable, quality suppliers is a great thing to put together immediately in your startup. You will need to have a steady supply of the things that are bringing the revenue into your business. Make sure to do your research and compare prices and keep track of all of the information you gather. You can compare vendors and decide which one has the right balance of quality and cost effectiveness.
Qualities of a Good Supplier:
This article gives more information on qualities to look for:
https://www.entrepreneur.com/article/66028
Knowing how to get your customers attention is important. They need to know who you are, what you do and why they should do business with you. That is the goal of your promotions.
How would you promote your small business?
1) Facebook Advertising
2) Flyers
3) Local Contest Giveaways
4) Youtube Ads
5) Email Marketing for Existing Customers
6) Signs
7) Phone Book Listings
8) Yelp Ads
9) Google Ads
10) Referrals
The cost of acquiring customers is a reality for all businesses. You are going to need to spend money to bring people in the door of your business. The key factor here is tracking how much you are spending on your efforts and how many customers resulted from those efforts. This will give you an idea of how much it costs you to acquire a customer. Once you know this cost, you can determine how much money you need your customers to spend in order to break even or better (which is the goal). Using some of the tips in this article and in Perry’s growth hacking video, you can substantially increase the amount of revenue you are generating per customer. This may seem like a lot to take in, but it is crucial to the success of your business.
Who will you need to help you?
When planning the staffing for your business, keep in mind that you will want to be fully staffed during your peak times but you don’t want to be over staffed during your down time. You can leverage temporary or part time workers to keep this under control. Before you hire anybody for your business, determine what positions you think are mandatory. For each position, determine their core responsibilities, the metrics that you are going to use to measure their performance and develop a clear reporting structure. If you give your employees the tools to succeed, they are much more likely to work hard for you.
It is likely that you won’t be able to afford all of the positions you need right from the start, so keep in mind that you will either need some part time workers or you will need to have some people hold multiple positions. For each position, make sure you are doing a cost/benefit analysis. Make sure that the position has the ability to pay for itself, ideally multiple times over. This is crucial for growth and scale.
Whether you are opening a brick and mortar business, home based business or an online business you are going to need to decide on a style for your business. This can include branding and a style guide. This will help your customers get to know you and will also show congruency from your ads to your physical or online store.
Benefits of Having a Style Guide for Your Business:
What Should Your Style Guide Have?
Having an account plan in place will work in your favor come tax time. Organization will be a key for you. Make sure to keep receipts for all of your expenses. You are also going to need a bookkeeping system. There are many solutions out there to consider.
You will also need to keep track of payroll and have a system for processing pay on a set schedule. Make sure that you also educate yourself on all of your tax requirements. This is where you will also want to keep track of your profit margins on your product offerings. They should be reviewed often to make sure your business is staying profitable.
Join the Startup Jungle community and enjoy the benefits of having access to thousands of other business owners. You can ask questions, get/give advice and tips to help your business along.
