So, you’ve finally decided it’s time to start your own business. You should ask yourself “what business do I want to start?” and “Is this type of business needed?” The only way of knowing this is by carrying out market research. My advice would be to cover this in your business plan. Write a killer business plan. Writing a business plan is essential. “The success is in the planning” this is one of the best pieces of business advice I ever received. You can plan to succeed, or not plan and fail.
The level of commitment and discipline needed to make a business succeed should not be underestimated. We’ve all heard those almost mythical stories of successful American business start ups, were people work 20 hour days, 7 days a week. Those stories are not exclusive to America. I know of several successful entrepreneurs in Nigeria doing the same thing. The success of your business will partly depend on your attitude and skills. This means being honest about a range of issues – your commitment, knowledge and ability, your financial status and the personal qualities that you can bring to your new business.
If you are still reading at this point, I’m assuming you must be serious about starting a business. Here are a few steps I feel are essential during your journey to starting a business.
1. Make sure this is the right thing to do
Before you invest your life’s savings in to a business, you should make sure that starting up your own business is really the right thing to do. Planning is essential. This will give you a foundation to structure your business operations. From income, outcome, overheads, potential suppliers, potential customers, marketing, capital costs, inventory levels. The list is endless. All of this has a cost. The cost might not be measured in actual Naira, but it is the cost of your time.
Again, we have all heard the stories of people who created six-figure businesses by investing less than $100. The capital investment was not huge, but be assured that these businesses succeeded due to hard work and investing time.
2. Be aware of your strengths and weaknesses
Ensure you have the right skills and qualities needed to make a success of the business. This doesn’t mean a degree from Harvard Business School. Some of the most successful businesses I’ve encountered were created by people who had a number of core qualities such as self-confidence, good judgment, open-mindedness and resilience to rejection and failure. Business can be cruel, so when times get tough you will have to call upon these qualities.
In addition to these qualities, it is also important to have a number of business-related skills so it is worth considering which ones you do or do not have, and teaching yourself. You will be surprised what you can teach yourself from free online courses/tutorials
3. Carry out market research
This goes back to the beginning of the blog – “Is this type of business needed?” You can only find this out by carrying out market research. Market research doesn’t have to cost you. With all the tools available on the web, your research can be carried out concisely, in your own town and cost free.
If you don’t know something, don’t be afraid to ask. Market research can be carried out in many ways, such as – conversations with family and friends, business contacts, consulting government demographic and economic data, which is often available online.
Market research is key to the success of your business. A common notion that is generally accepted is that when an entrepreneur fails it is due to financing issues. In many cases new business ideas fail because not enough time has been spent researching the business idea and determining whether or not it was needed.
4. Understand your funding streams
If, after taking all of these other things into account, starting a business still seems like the right thing to do, the next step is to consider how you will fund your business.
At the beginning, investment will come from you. Do you have savings that can be invested and if these saving aren’t enough, where can you borrow to finance the venture? When putting together your killer business plan, a detailed financial plan should be included.
You should never limit your long-term ambitions, but you should manage your short-term expectations from a business. It is important to realise that a business is not going to be a financial hit in the short term and managing cash flow is vital.
This is not a comprehensive format of steps to be taken on the road to starting a business. But they are steps that I’ve personally used when starting my own businesses, or consulting for private clients.
Please feel free to contact me if you have any questions.