5 crucial points to consider before you start a business
Starting a business is almost like venturing into a new relationship with someone, you don’t know exactly what is going to happen but your desire for this person gives you optimism that something good can come out of it. Much like a relationship with a human, being your business becomes very similar to such an instance if not the same. People always say it is what you put in that you get out in a relationship and the same applies in business if not more. The collapse of a relationship can be due to several factors such as mistrust, lack of effort, disrespect and disloyalty. All these qualities if present in business are a recipe for disaster and a push in a downward spiral. Here below are some key points to ponder if you are thinking of going out on your own and starting a business. Whether you desire to start a beauty company, translation agency or would like to make your mark in London’s tech hub, Shoreditch or even thinking of setting up an internet business, you will be able to relate to the points below.
- Is it profitable
The main reason that most people start a business is to make a profit. Yes even charities need to be profitable in order to run. After all the current world we live in is majorly driven by the value of money from the financial institutions to your everyday corner shop. The aim for these establishments is to provide an income for one self and earn a profit. When you are in your initial stages of business planning it is helpful to understand when you are likely to make a profit and how much you could make as this will help you to allocate resources appropriately. This will also help you with budgeting which is imperative when setting up a business.
- What resources do you need
When deciding to start a business you cannot simply go into it blindly expecting to do things as they come along. Yes there is uncertainty in business all the time, however carefully listing the resources you for not only the initial start-up stages but as you grow will help you see clearly how much investment is required and also help you decide which means of investment is best suited for your business, be it bank loans or venture capitalist investment. For example if your business is not expected to make a profit until year 3 you may favour investment by means of selling shares as opposed to bank loans with high yearly interests. Another point to think about is whether your business is likely to go global as in knowing so your will be able to allocate resource’s such as legal costs for trading internationally or translation services to help market your business to international markets.
- What are you trying to achieve (personally and professionally)
This point is very important in a sense that it will drive you in the direction where you will be most happy. The whole point of starting a business is to do something you enjoy doing that doesn’t feel like you are working all the time even though you will have to at the beginning. Otherwise you can easily settle for a 9-5 and switch off at the end of the day and collect your salary at the end of the month. Know and understand the ‘real’ reason why you are starting a business and where you want to be in the future as this will help maintain your drive and energy during hard times.
- What help do you need
As the famous saying “no man is an island” goes, business is also that. Whatever your business you will need people’s help along the way whether that is starting a business with a business partner or going at it alone. The relationships you build with people will help determine your success. This applies to all aspects from how you manage your employees, how you deal with your suppliers and how you communicate with your clients. All these stakeholders will play a key role in how successful your business will be.
- What is your plan B
Many people start a business without having a plan b. Now others may argue that having a plan B can sometimes deter you from your main focus which is your current business and not having a plan B will drive you even more to be successful in your present business. Although that may be the case, in some ways having a plan B is imperative as it will enable you to bounce back quicker when things don’t go to plan. Before you launch your business know your exit strategy, when it is time to sell or close down the business and have an idea as to what you will do next, after all life does not stop when your business stops.
Image by: Nana B Agyei
