8 things to know before starting a business

The content of the article

• Eliminate lack of funds
• Choose the “right” business
• Create a business plan
• Keeping up with the needs
• Do not hire friends
• Balance between work and personal life
• Avoid Debt
• Find an experienced mentor

Own business is a fascinating but difficult task. Universities do not prepare the student for the unexpectedness of the real market, so everything is comprehended in practice. Beginners will find useful tips on how to start a business and get around the most common pitfalls. The advice of experienced entrepreneurs is not a guarantee of success, but good help in achieving it.

Eliminate lack of funds

The first financial difficulty is seed capital. It is mined in different ways, but one of the proven ones is personal savings. Savings can be invested in the first stage of building a business. So a startup will have more development options, a stronger foundation, and you will have less debt.

Another financial danger is pricing. At first, new enterprises often underestimate the cost of goods or services. Discounts help to promote the business and attract customers, but unstable prices are a constant risk of falling to the bottom, becoming bankrupt. It’s more reliable and correct to work on increasing the usefulness of products for people, and not just cut back on your income.

Choose the “right” business

The goods and services themselves also determine whether success or failure. If market conditions are not in favor of your business, then it doesn’t matter how much time, effort, or resources are spent. A current example is air travel. Their profitability in most countries ranges from 1 to 2%. Companies in this area have to survive naturally even with competent management and experienced employees..

Create a business plan

Beginners are too lazy to think it over, especially if they are not looking for investments on the side. It is safer to immediately develop a project model that generates regular income, and only after that – implement it. Creating a business plan with forecasts and a marketing strategy will hone the idea of ​​a startup, identify problem areas.

Development comes from two key issues:

• How will this business satisfy specific needs or solve specific problems?.
• How high are its market prospects.

From the start, think about the exit: the company will be sold, your children will inherit it, or the company will be managed by several owners. The desired result determines the nuances of building a business, including its legal structure.

To implement the plan you need a team. Business is people, so put in the strategy incentives and ongoing training for your employees. Try to understand their needs, appreciate the merits, help to correct the shortcomings. Personnel come and go, but while the person is with you – invest in it.

Keeping up with the needs

The market is a living mechanism that is constantly moving and changing. Therefore, your business should be the same. Be prepared to forget about your experience to see new market benchmarks and master an unfamiliar industry. You may have to rebuild your thinking, change outdated approaches, abandon past expectations.

Every innovation is critical. First, understand where to start a business, outline the right path and move to the main goal, without spraying on small ideas. The more often the direction of activity changes, the more difficult it is for the enterprise to grow. When you consider any initiative – soberly consider whether it fits into the general concept of a startup. If so, plan on launching an innovation..

Do not hire friends

Sometimes it is not easy to punish or fire an employee with whom you have a warm relationship. If a person does not benefit your business, then put off your feelings and make the right staffing decision. Any member of the team can fail: poorly perform their duties, cheat, cheat. Do not lose faith in people, but do not let yourself be deceived.

It is better not to hire close people so that conflicts from the work sphere do not become personal. Everyone has disadvantages, including your friends. If a friend does not cope with the work, evaluate it from the position of the employer, not a friend.

Balance between work and personal life

Entrepreneurs often devote 12–13 hours daily to their business, and for years in a row. Sacrificing personal life and dissolving in work, people burn out, and most of their efforts do not bring results. Reduce your work day, but do it rationally: find an assistant, carefully plan all affairs, delegate small tasks to subordinates. This will allow you to move forward faster and spend time with your family..

Avoid Debt

When starting a new business, try to do without borrowed funds. A startup is already a risk, especially for beginning entrepreneurs with an unverified business model. Loans increase the risk of failure: if the company crashes, debts will remain on the former owner.

Sometimes, in order to open their own business, people get private, mortgage or other types of loans with the lowest interest rate. This approach is viable, but here you need to be careful, treat loans without too much optimism. Be smart about your potential and don’t borrow too much..

Find an experienced mentor

At the beginning of the journey, it is advisable to get support from a person who is familiar with the chosen field. He will teach you the nuances of doing things, take on a share of responsibility for the actions of a beginner. Choose a mentor of an experienced entrepreneur with solid business achievements, faith in your idea, willingness to honestly express your point of view.