Preparing for a Small Business
Below you will find starting a business advice and tips that will help you prepare for your small business venture.
1.)Should you quit your job?– If you can start a small business while keeping your job even part-time, the extra money will help you greatly. Keep in mind small businesses can take months or even years to start making profits. If you decide to devote to your small business full time be sure to have enough money saved up.
2.)Budgeting Living Expenses– Determine how much money you need to live on for the 1st year of your small business venture. You should have enough money to support you and your family during that time. If you have a partner such as a wife or husband that can take care of the expenses while you launch your small business that can be very helpful.
3.)Estimate the expenses of starting a small business– Usually costs of starting and running a small business turn out to be more than expected. One major reason why small businesses fail is because the owner did not have enough funds. That is why it is a good idea to have more money than you think you’ll need. Create a small business budget which includes all the expenses of your small business. In your budget you can include costs of insurance, equipment installation, location, employees, licenses, permits, remodeling, marketing, website development, repairs, unexpected costs and more. This can help you estimate the costs of starting a small business. Learn about different ways of raising capital for your small business.
4.)Get experience– Once you decide on a small business idea, research that business industry. If it is an area in which you have no prior experience consider getting a job where you can gain experience. For example if you are planning on opening a restaurant, it would be a good idea to get a job in a restaurant first. This way you can gain valuable knowledge and insight about the restaurant business. You can use this experience as an opportunity to uncover the restaurant’s strengths and weaknesses, and how your restaurant can be better. Be sure to seek successful businesses to work in. You can learn a lot about a business even in the low level positions. In fact many entrepreneurs get their start that way.
5.)Consult with experts– During the process of starting a small business it is a good idea to seek advice from experts. Don’t underestimate the value of information from professionals who have useful business knowledge and experience. You can find experts at little to no cost at a small business development center near you. You can also consult with experts at a SCOREs Chapter near you. It is a good idea to seek the following experts to consult with frequently as well.
- Attorney– Make sure the attorney has experience working with small businesses. You can ask a small business owner to recommend a good attorney. An attorney can help you choose from the forms of business ownership and ensure you have the required permits and business license. They can also ensure that your small business is in compliance with the laws. When hiring employees they can help you form an employee contract.
- Accountant– An accountant can help you form a book-keeping system, produce financial statements and help you do your taxes.
- Banker– A banker can issue you a small business loan or recommend other ways to raise capital for your small business.
- Insurance Agent– A good insurance policy can protect you and your business in the case of an unwanted event. If you hire employees you are required to have workers compensation insurance. Be sure you are in compliance with your state’s insurance policy.
6.)Perform an entrepreneur profile self assessment– find out which entrepreneurial tasks you are good at and which ones you need help with. Once you have accessed your strengths and weaknesses you can then decide if you want to hire a professional to do the tasks you need help with, or learn the task and do it yourself. Often times it will save you time and money if you hire an expert to do the job than it would for you to learn it and do it yourself.
7.)Find a Mentor– Ask people who run similar businesses as yours for advice. Many small business owners will happily offer their advice, however some business owners will get offended if they find out their competition is trying to get advice from them. In order to avoid your competition you can ask business owners in neighboring areas. If you are able to find a small business owner who is willing to give you advice be sure to ask these questions. Find out what were the biggest problems they faced when starting their business. How did they overcome those problems? Business association meetings and local Chamber of Commerce can provide you with the opportunity to meet other business owners.
8.)Have a supportive team– Starting a small business is an emotional roller coaster ride. You may be happy one day because your small business is gaining profits and then hopeless the next day because you found out you have to spend thousands on replacing broken equipment. This is why it is important for an entrepreneur to be able to handle stress. Having encouraging friends and family can help you through the rough stressful times. A supportive spouse can help motivate you when you become discouraged. Surround yourself with people who share your same vision and dream for your small business. However if your friends and family don’t support your business idea don’t worry. There are many successful entrepreneurs who became successful despite the non-support of thier friends and family such as Bill Gates. You just have to be that much more determined and confident in your business idea.