If you’re considering starting up your own business, chances are that you’ve already been regaled with an onslaught of business horror stories. Everyone will have a precautionary tale to tell of an acquaintance’s business that became a financial disaster; someone they know who has ended up bankrupt through chasing their dreams; anecdotes of repossession, financial breakdown and the consequent collapse of personal relationships too. While these things may happen to a few unfortunate souls, don’t fret. If you are sensible with your finances, take your time and remain grounded, you are unlikely to see such extreme and negative results. Yes, making it big time in the saturated and competitive market, hard work really can pay off, and you will be rewarded with success and profit for original, well-thought out products and services. Studies have shown that 75% of businesses survive their first year, 69% survive two years, and 50% survive five years. You want to be a part of the last group mentioned. So, how do you go about setting up a business that can survive the test of time? Here are a few tips and tricks to get you started on the right foot.
Do Your Research
Before investing time, effort and cash into a project, you need to know what you’re taking on. So before you even begin setting pen to paper with brand names, product concepts, and advertising techniques, you need to get your reading glasses on and ensure that you fully comprehend the market that you are entering. You should be able to identify the individuals or companies who currently dominate your field of interest (after all, they will be your future competition) and your targeted consumer demographic (including their wants, needs and disposable income). You will need this information before you can even identify a gap in the market that needs filling. Once you have identified a need or want that is being left unfulfilled, know who you are catering to and who you are up against, you can begin developing your brand and its products.
Organizing Your Finances
So, you’re ready to get started. But before diving straight into the deep end, you need to organize your finances. After all, you are going to need a steady and reliable cash flow to undertake effective and professional market research, employ designers, develop and test products and either set up a tangible, brick and mortar store or set up online. As you gain more information and get deeper into the process, costs may change and fluctuate. But it’s good to have a vague idea before you start out. You can call in professional help or simply note down quotes from external agencies, total them up for a roundabout average of how much you’re going to need. Next, you need to source this money. Some people will have savings put aside, but the majority of us will need to look into taking out a loan of some sort. To start out, you may like to use online payday loan companies for smaller quantities of cash that will tide you over for the time being. Once you are reaching the stages of product development (where you may have to begin purchasing things in bulk), you might like to look toward a bank or more long term lender. Remember that good credit is essential for maintaining a professional and reputable business, so it’s paramount that you pay back the amount in installments on the specified dates in the terms and conditions of your contract.
Once you know where you’re going and have the funds to make your dreams a reality, you have created the strong foundations that your business needs to thrive.