The entrepreneur journey begins even before you make the decision to start your own business. It begins when the idea to do so first crosses your mind, when you think, “wouldn’t it be nice if…”
Once you’ve had that thought, you’ve already started planning. You might find random thoughts going through your mind, such as “maybe I could turn the spare bedroom into an office” or “I wonder if so-and-so would like to come with me. I think we would make a good team.”
So the initial plan probably gets fabricated in this random way within your mind. It’s not a formal strategy by any means. But once you leave your job and decide to put this informal plan into action, it might be time for you to start strategizing on paper. This will help you to avoid common mistakes that entrepreneurs make. Here are a few of the things you need to consider:
1. Is There a Demand for Your Product or Service?
Most likely there is a demand for what you’re trying to sell. Or else the idea of starting your own business may never have crossed your mind.
If you’ve been working in the industry for a long time now, then you probably don’t need to do much research. For example, if you’ve been working at real estate agencies for quite a few years and you’ve only just decided to start your own agency, then you probably already know that there’s a demand for what you’re selling.
However, if you’re moving neighborhoods and planning to start a real estate agency in your new neighborhood, then you will need to do some research about what the real estate market is like in your new neighborhood, maybe even take a class or two to brush up your skills.
Once you’ve established that there is a healthy demand for what you’re selling, you should feel more confident about starting your entrepreneur journey.
2. Where Are You Going to Get the Money?
The most important element of starting a small business is getting the money. You’re going to have a lot of expenses such as finding office space, employing people, starting a marketing campaign etc. So you’ll need to have money to fund all this.
Is there someone who believes in you enough to put up the money for you? This could be a family member or a friend who is looking to make an investment. Sometimes, entrepreneurs feel hesitant to ask people who are close to them for money. However, this is actually your best bet because these people already know you and wish the best for you.
Of course, if you have enough savings, you won’t need to ask anyone for financial help. But this means that you need to have the foresight to start saving a few years before you quit your job.
If you have any assets to put up as collateral, you can go to the bank with a business plan and try to get a loan. You can also do some research to find out if there are any other options open to you—any governmental or non-governmental loans that you might be eligible for. Just remember that applications need to be put in a long time in advance.
3. Who Are You Going to Work With?
People are the backbone of any business. You need to work with the right people if you want to make a go of your business. This means people who are efficient, ethical, good with people and team players.
Some of the things you need to look for in people are self-evident. You need to work with someone ethical if you don’t want them cheating you or your customers. Efficiency is also necessary because you can’t have someone who takes three hours to finish a one-hour task.
But do you really need someone who’s good with people? Not everyone thinks this is absolutely necessary, especially if you’re working with someone who needs to work largely independently, like a computer programmer or an accountant.
Still, it never hurts to work with someone who communicates well with others because, sooner or later, they’re going to have to come out of their shell.
4. Where Are You Going to Set Up Your Business?
You may not have much place to set up your business, so you plan to do it in the garage or the spare room. But if you’re actually going to get a suite of offices, consider your location carefully. This is because the location of your business can make or break it.
Most of the time, it just makes a lot more sense to set up your business in the downtown area rather than the suburbs of your city. You’ll get less space but clients will be able to find you easily. Plus, you’ll also be close to other business associates who have offices in the area.
At the same time, you may not want to be too close to competitors or else you’ll end up eating into each other’s business. So make sure to keep a healthy distance.
5. What’s Different/Special/Unique About You?
It’s always a good idea to consider the answer to this question before you start your own business. This is because it will help you with your branding efforts in the long run.
The essence of a brand lies in its uniqueness—the idea that it can package up and offer to customers along with its product. Think about what you’re selling in addition to your product. Is it the idea of exclusivity which shows in the quality and packaging of what you’re selling? Is it the idea of comfort associated with hearth and home?
There are many such ideas which can be linked with your business to create an effective brand. But first, you need to decide what you stand for. And it’s best to do this in the beginning so that people don’t get the wrong idea about your business or product.