Deciding to start your own business great but knowing the factors to consider before starting the business is the key.
Business is no doubt packed with uncertainties and probabilities either you succeed or not.
So, the good news is:
KNOWING THE FACTORS TO CONSIDER BEFORE SETTING UP A BUSINESS
If you are a self-starter with a niche product or service, you may be considering starting your own business. While doing so can be incredibly rewarding, it’s no secret that many businesses fail within the first 2 years.
To avoid this trap, make sure you understand all that’s involved first. Once you are sure that your product has a chance, begin drawing up your business plan, using the following tips to guide you.
Throughout the years, entrepreneurs have turned their ideas into goods and services. They have met the needs and wants of consumers and, at the same time, they have built rewarding careers for themselves.
The following factors, therefore, need to be considered before delving into establishing your own business.
Whats is The Factors to Considers Before Starting your Business
#1. A GREAT IDEA;
You need something that is going to be successful, something that will stand out from the pack and most importantly, something that is needed. It doesn’t matter if there are already a few hundred out there…if you can make your business stand out and offer something different (whether it be a concept, price or service) from the others, you will succeed.
Depending on what exactly your business is and the start-up costs associated with it (this will vary from business to business) will determine how little or how great your start-up capital required will be. You will need to ensure you have funds behind you during the start-up phase to get the business off the ground.
You can use your own money, or if your product or service is particularly unique, consider getting an investor. Otherwise, apply for financing through a bank or credit union. You will need to provide a thorough business plan prior to seeking financing.
Starting and owning your own business can be really tough, in many ways, but also rewarding, which is why you need passion by the bucketful to get through the good times and the bad.
When you love something like it’s your own baby, not only are you super protective and willing to put in 100%, you need passion because, with it, you don’t mind working that little bit harder, longer, giving it ALL you’ve got.
Where will you stay to sell your goods or products? The location of a business is very important. Assuming that the market and the demand for the product is known, one must ensure that the business is located in a place where the consumer will have easy access to the product or services. In choosing a location, one should consider the comfort of the customer, i.e., the target population.
#4. RAW MATERIALS:
What are the things you need in producing the item you so desire or in the sale of it? Are they easily available or obtainable and accessible? Availability of raw materials affects the profit of the business.
Where the raw materials are not easily obtained, it is advisable not to engage in such business.
One should consider the cost of transporting the goods or the product from where it is made to where it is needed. i.e, to where the products are going to be sold. One should also consider the cost of transporting the raw materials from where they are obtained to where they will be used for production. It is also important to consider the product to be transported and the durability. For example tomatoes are a perishable product, which can be damaged when transporting. Therefore, the transportation and storage of such products will need serious consideration. Note that there are instances where the issue of transport may not be too important.
#5. THE MARKET:
The market consists of the people you want to sell your products to. In other words, it is the target population. Is the market for your product or service readily available?
Demand is not complete until the goods produced are bought, consumed, or used. Thus, one must consider the ability of the consumer to pay for goods or services. If goods are not bought or used they become useless and ineffective.
#7. PRODUCT KNOWLEDGE
The idea behind the business may be incredible, but the business is doomed if others do not agree with the idea. You should be extremely knowledgeable about your product or service and why you think it will do well. Consider conducting a customer survey.
However, be sure to have them sign a disclosure statement to protect your idea. Be sure that you can make a profit. Determine how much you will need to charge in order to do so.
If your product will cost more than the same or similar thing from other competitors, determine how you intend to compensate for the difference, such as by offering excellent customer service or incentive programs, or by having a convenient location.
#8. HIRING EMPLOYEES
Small businesses may need to hire individuals to help the business owner run the business. Hiring the right type of individual is essential to running a successful small business.
Entrepreneurs must hire individuals with the right type of education and experience that will not create significant financial burdens on the small business.
#9. COMPETITIVE ADVANTAGE
In other for a small business to operate more efficiently than other companies when producing goods or services, fill a market niche or unmet consumer demand, sell products cheaper than competitors or reach more consumers with specialized marketing strategies, the Entrepreneurs should carefully plan their small business’ competitive advantage to ensure they can obtain enough market share to make a profit and grow their company.
#10. MARKETING STRATEGY
Marketing methods help small businesses inform consumers by providing specific information regarding goods or services. Small businesses may use print ads, radio spots, television commercials or Internet advertising to reach various target markets.
Two common marketing strategies are direct and indirect. Direct marketing pits the small businesses against a competitor and tells consumers why one product is better than another.
Indirect marketing is used when a company needs to inform consumers about new products or services offered by the small business.
In order to succeed, most small business experts urge prospective business owners to carefully and completely analyse their potential venture.
Typically, you will begin by analysing yourself as a future entrepreneur. What kind of person are you? What technical or special knowledge do you have?
Self-confidence and drive, innovative thinking, goal orientation, and business and technical knowledge are necessary to succeed.