Apparently, tough times are the best time to set up your own business. The recession may have hit the economy where it hurts, but out of the ashes arises the entrepreneur. A new generation of the self-employed, fuelled with an unstoppable vision and an insatiable desire to succeed, emerges to compete head-to-head with their larger counterparts.
The resources needed to start up your own business are a lot more accessible nowadays, and it is easier than ever before to make the leap and become your own boss. This results in tougher competition.
If you want to thrive, here are the four crucial aspects you must consider, whether it’s regarding your competitors or your own finances, before taking the first steps to starting your own business.
How much you need to invest upfront
The most important thing you need to know before you begin is how much money you can afford to invest in your venture.
Yes, startups can be cheap to run in the early stages, and you may have a great idea, but unfortunately a good idea doesn’t equal a lucrative business overnight. You need to consider your brand image and how you are going to build it.
Do you need someone to create and develop your website? Should you pay for legal and professional fees? These all add up and you need to keep on top of your finances from the beginning. If you are struggling to work out how to manage all your outgoings, there are consultancy services specifically designed to help self-employed professionals.
Knowing all your startup costs upfront will give you a far better chance of building a sustainable enterprise in the long term.
Know your market inside out
There is no sense of entering a market that you know nothing about.
Do your homework, find out who your main competitors are and study them profusely before you even attempt to start a new business in that market. You want to surpass what competitors are currently achieving, so carry out lots of market research and identify weaknesses from there.
Is there a gap that you can fit into? If the market is saturated, it’s going to be much harder to make an impact.
It takes 2 years to build up a book of good contacts
The demand for your product may be high, it may be the most perfectly fitting peg to fill the gap in the market, but you have to remember that establishing your brand will take time. Connections and networking mean everything right now, and as noted before, entering a completely new market will take longer than one you are already known in.
It takes time to build a solid contact list, establish a good reputation and generate client referrals. If you are operating in a familiar market, it may take a little less time but you still need good word of mouth to bring in business from outside your main circles.
Concentrate on your marketing from the beginning, especially building up your brand, and you will find that gaining outside contacts becomes a lot easier.
Entrepreneurs who dabble in multiple businesses are more successful
If you are thinking of sticking to the same idea for the entirety of your company’s life then, 1) it may die a premature death, and 2) you shouldn’t be an entrepreneur in the first place.
Be prepared to participate in various sectors of business when you first start out. You need to be well versed in sales, marketing, finance, product development, web design and even delivery. Not only this, but you need to be self-motivated too, especially when you don’t enjoy the task at hand, you don’t have a boss to remind you to focus on financial reports when you’d rather concentrate on the website design brief.
The direction of your business may also change over time, with what you initially set out to do not being what you actually end up doing. Although embracing opportunities does leave you vulnerable to risk, it also opens up the door to success.
In short, make sure you are flexible and capable of adapting to changes in the market.