So you want to start your own business? There are 3 important things to consider in running run a business successfully.
1. Set reasonable goals for the business.
2. Market your product or service.
3. Obtain adequate funding that will last through the start-up phase.
1. Set Reasonable Goals
Many people go into business thinking they are going to make tons of money within the first few months. That’s almost never the case. It is helpful to put your goals in writing BEFORE you open the doors for the first time. Once you have written everything down, go back and modify it to make it something that can realistically be accomplished.
It is also a good idea to put these goals into a business plan. Just about every lender and government agency will expect to see some kind of business plan before they will give you any money. There are a number of very easy-to-use software programs out there that ask simple questions to help you through the process. Once you have your goals in place you can begin to set up your roadmap to success.
2. Market Your Product or Service
We have all seen great businesses with a superior product and location go broke and close the doors. Successful marketing starts with you, the business owner. You know your product or service better than anyone else. You have taken the time to think through how it meets the need of your customer. The challenge is how to get customers to know they need your product or service.
About 5% of your expected annual revenues should be spent on marketing. Some things to do to get results from your marketing plan are:
- Define your market. Who are you trying to sell to?
- Test a sample market group of customers and get feedback through surveys and personal interviews.
- Think of ways to attract customers. How does your product or service compare with the competition?
- Determine the best way to sell to customers. How does your product or service make life better for your customer?
Obtain Adequate Funding
This is the most important part of the process. According to the US Small Business Administration 50% of small businesses fail in the first year because of inadequate funding. Ask yourself hard questions like:
- How much money will it take to start my business and keep it running?
- What kind of equipment will I need to be purchase?
- How much will it cost to maintain the equipment or building?
- What kind of personnel will I need to hire and how many?
- What do I need to learn in order to run my company successfully?
- Where will I find my customers?
Getting a business established takes money, especially in the beginning stages. The government is a great place to look for funding. There are a ton of grants, loans and entitlements available for small business start ups. The biggest obstacle in obtaining government funding is the paperwork. The government loves paperwork and they make it pretty confusing. Because they make it confusing, there are millions of dollars in government programs that go undistributed each year.