Steps To Starting A Small Business
So you’re thinking about starting a small business. It could be one of the most important steps you’ll ever make. Before you make the decision to proceed, you may want to consider the pros and cons of launching your own business. This document is designed to help you through the process.
Entrepreneurship offers many rewards. It offers the freedom of being your own boss. It offers the personal satisfaction of building a prosperous business. And it offers the chance to earn an income that is limited only by your choices, skill, and your determination. There are, however, many risks.
Many would-be entrepreneurs are not aware of the effort involved in starting a small business. Many new ventures place heavy demands on your time, your family relationships and your finances. As well, an overwhelming majority of small businesses fail within the first three years, and many require several years to return the entrepreneur's original investment.
There is also good news. Small business ownership offers you financial and decision-making independence. If your venture succeeds, you gain job security and the opportunity to provide employment to others.
Questions you should ask yourself
Do you have what it takes? Answer the following questions to help you determine your business strengths.
Have you tried owning or operating a small business before? If yes, did it succeed or fail?
If it failed, why? What did you learn from the failure, and why will this venture succeed?
Do you think positively about yourself and your abilities?
Are you ready for long hours of research, planning and hard work?
Do you have the ability to identify and solve problems? Do you see problems as opportunities?
Are you able to set reasonable short and long-term goals and then follow through? Do you regularly set objectives and then evaluate and adjust to meet them?
Can you identify, evaluate and manage financial and other risks involved in operating a business? Can you determine the effect of various risks on your business? Can you distinguish acceptable risk from outright gambling?
Can you accept failure as part of the learning process?
Do you seek out and use feedback? Will you be objective about other people’s ideas and observations concerning your business proposal?
Are you a self-starter? Will you display initiative and accept responsibility for the affairs of your business?
Will you deal effectively with competition? Success will attract competitors to your business. How will you deal with them?
Can you handle uncertainty and a constantly changing business climate?
Are you able to attract the right people to your business? Choosing partners, shareholders and key employees is extremely important.
Does your educational background prepare you for your chosen field of business?
Has your work experience exposed you to the type of business you wish to start or buy? Can you demonstrate this experience to potential backers?
Are you willing to prepare or assist in preparing a business plan which details every aspect of your proposed enterprise?
How effective are your business management skills? Do you have general knowledge of financing, buying customer relations, advertising, banking and loans, selling, pricing, insurance, and employee relations? What other special skills will you need?
Do you understand the various laws and regulations that govern your business? Have you considered permits, licenses, zoning, employee deductions, labour relations, taxes, record keeping, and shareholder agreements? What other legal requirements will you need to meet?
If you've taken the time to answer these questions, you now have a better understanding of your ability to start a successful small business. If after answering these questions you are still unsure, you should talk with a consultant such as The Business Guide Inc.