If you’re considering starting a new business, or even if you’ve recently taken the plunge, you need to ensure you make the best decisions for your future business. From creating a business plan to building a business website to choosing your location, every decision you make will either fuel or hinder the growth of your new business. Be sure you have a solid plan in place for each step in getting your business up and running.
The Business Plan and Website Building
Researchers and experts agree that making a business plan is well worth the effort. One study found that entrepreneurs who wrote a business plan were two and a half times more likely to actually go into business. For further motivation to create a business plan, consider that you’ll likely need one in order to receive funding from outside sources. When writing your plan, aim for 20 to 40 pages in length.
Creating a website for your future business is not only a great idea, it’s also a necessity, especially for entrepreneurs, small businesses, and any businesses selling products or services. Even if you aren’t selling anything online, you still need a solid website. According to Forbes, your website should “serve as an extension of your business card, with information about you, your business, and services offered.” The most important job of your website is to give you credibility.
Location, Location, Location
Remember that location is immensely important, especially if you’re going into the retail or consumer service industries, such as restaurants, dry cleaning, rentals, etc. While the choice of location isn’t as crucial if your business is mostly online, it’s still important. You’ll need to consider how your location will affect rent costs, shipping costs, taxes, and more.
Look for a location with traffic generators that draw people to the area. Traffic generators include other retailers, industrial or office parks, colleges, and hospital complexes. Also, consider a location that has a high concentration of your niche market. When you’re making a website, be sure to include your location so your customers can easily find you.
You’ll also want to look at where your competitors are located. Although your first instinct may be to avoid being near competitors, it’s best to be as close to your biggest competitor as possible. “By being in close proximity to your competitors, you can benefit from their marketing efforts,” says Entrepreneur.
Location also applies to the digital space as well. Look at your website domain name and see if there are similar names in use. Do you have a social media presence? How do you communicate with your client base. Do you use Facebook, Twitter, Instagram, SMS Messaging or Email? These digital traffic generators can be crucial to your branding and aid in defining your differences with your competitors.
Staying Afloat Financially
Although it can be tempting to pour everything into your business to help it grow, you really need to keep personal and company finances separate to ensure that you save money for yourself and don't lose all of your money in the business. Also, separating the two will protect you from liability if any legal issues were to arise or corporate debts were to occur. Additionally, your business should be incorporated as a distinct legal entity with its own finances. If you fail to do this, debts the business suffers may be paid out of your own pocket.
When setting your salary, don’t shortchange yourself. Many entrepreneurs underpay themselves significantly, but this is a risky choice. “Not only does it put your personal finances in jeopardy, it also creates a misleading picture of your company's finances,” warns Inc.com. Research the appropriate pay for someone in your role, industry, and area, and pay yourself fittingly. You need to be able to cover your basic expenses, as well as set money aside for savings. Paying yourself appropriately not only allows you to factor in how much capital you will need to finance your business long-term, but it also prevents you from needing to drastically change the cost structure in the future.
One final tip is to adequately save money before you start a new business. Even if you pay yourself well, it’s likely to be less in the beginning, and you don’t want that to affect your life outside of work. Starting your own business comes with inherent risks, but it can pay off big time; you’re the boss, you’re doing something you love, and you have the opportunity to reap substantial rewards when your business turns into a success. Ensure your business is a success by starting off on the right foot and properly planning for all steps in the process.