So, thinking about starting your own business and aren’t sure where to begin? Relax. I’m here to start you off down the right track with some solid advice. As the title of this article clearly states, I am someone who never actually attended business school, but I do run a successful business! Luckily for me, one of my dear friends is a very savvy woman with an M.B.A. in Marketing. When I was first starting my business, she offered me some invaluable advice which I am going to share with you! Today’s article is all about laying the foundation for a successful business. It is about providing you with some practical advice that will not cost you a dime, but will require some serious thought on your part and a willingness to put pencil to paper. (Note: If this already sounds tedious, then going into business for yourself is NOT going to be for you. Having your own business IS a ton of work). Still interested? Here we go!
Starting a business always begins with an idea. Building a successful business largely hinges on the careful development of that idea from the beginning. Whether you are planning to open a shop or a daycare, whether you are planning to start an online business, or you are intending to write a blog…planning is of key import. The fact of the matter is that most small businesses do fail. In order to increase your odds for success, you will need to do your research and you will need to sit down and write a detailed business plan. Here are some tips for the early developmental stages of your business plan:
1. Be a woman with a mission. In order to begin developing a clear direction for your business and what it will become, it is important to fully verbalize what you are setting out to do. Your mission statement may be only a few sentences, but it should encompass your overall vision. It should be simple, clear and concise. For example, here is my mission statement for Brains, Beauty and Balance: “I believe that every woman should be equipped with the tools to be the very best version of herself and ultimately to lead her most fabulous life! ‘Brains, Beauty and Balance’ is all about empowering women to be able to do just that.”
2. Do a S.W.O.T. Analysis. What? S.W.O.T. is an acronym for: Strengths, Weaknesses, Opportunities and Threats. Sit down and think long and hard about each of these categories. For example, if someone had always wanted to own a nail boutique her S.W.O.T. Analysis might look something like this:
- Strengths: I have been a nail technician for 6 years. I have a large existing client roster. I am very confident in my skill set.
- Weaknesses: I have no experience in running a business. I have a limited budget to work with.
- Opportunities: I can open my business in a central location where I will be highly visible and can attract new clients. I can attain referrals from my existing clients. I can take a business course at my local community college.
- Threats: There are at least 10 other nail salons in the area so my competition will be strong. I am not sure if I can earn enough money to stay afloat while I am building my business.
3. Do your market research! Starting a business with a physical location? First, think about where you want to be then determine a radius that you want to research around your business. Looking once again at the nail salon example…she might want to determine how many nail salons are within a 5-mile radius of her. If I were her, I would begin by reading all of the salons reviews. I would also call them up as a prospective client. I would determine what I did or did not like about each experience, so that I could see what does and does not work. Next, I might plan to visit several of the salons as a client. It would be important to look at the price range of all of the salons to know the market values of various services. I would take copious notes on everything and use those notes to further develop my own business plan. Do you see how your plan can begin to grow? Doing your market research will also help you to discover areas of opportunity within your chosen market which your business can be designed to “fill-in”.
What if you are interested in starting an on-line business? Search engines are about to become your best friend! When I first thought to start this blog, I decided to research a number of the top-grossing blogs in my related genre(s). I chose my favorites and then read each on a regular basis for several months. I began to observe what set these blogs apart from the millions of other blogs out there. I asked myself questions, such as: What visual impact does this have on me? Why do I like this or that? What commonalities exist between these successful blogs? (If you are still reading, then you know that my research was helpful)! 😉
4. Budget yourself! You must, must , MUST know how much money you have and how much money you are willing to invest upfront. If you will require a loan, then you should contact the bank to determine what criteria they will need you to meet so that you can adequately prepare yourself. (Note – if you will be requiring a loan, then a business plan is a must). If you are thinking to bring in investors or are considering taking on a partner then you should absolutely hire an attorney who is well versed in contract law to represent your interests. This is NOT the area to skimp on spending…as the saying goes, “Penny wise, pound foolish.” Business 101? Protect yourself on the front end. Once you have established your budget, you will need to list all of your costs both fixed and variable down to the last pencil. You would be amazed how quickly a budget can disappear! Careful planning is of key import.
This may not seem like much, but beginning as simply as what I have outlined above can offer you a wealth of information. Firstly, do you have a clear enough vision of what you want your business to be to write a mission statement or do you need to “return to the drawing board”. Secondly, although the S.W.O.T. Analysis may seem a bit tedious it can be very helpful to clearly categorize your thoughts. If your idea still seems viable after the completion of your thought process, then you can develop your ideas from there. For example, you can expand upon your opportunities when you begin to write more detailed sections of your business plan. In the case of the nail technician above, it might make sense to think about developing a plan to acquire more referrals from her existing client roster. Perhaps she might want to create an incentive program? Next, by doing your market research diligently you will know exactly what you are up against and what strengths and weaknesses exist in your chosen market that you may capitalize upon. Lastly, by doing a detailed budget you will be certain of where you stand financially.
Starting a business can be very overwhelming. Breaking the process down into smaller steps can make the entire experience feel less daunting. While working within the parameters of your budget is of the utmost importance, there are certain areas where you will need to spend money upfront. Hiring a good attorney and a good accountant are going to be two very important expenditures early on; however, before you even begin to think about plunking your money down, developing a strong business plan and truly budgeting yourself will get you started on the right track.
Interested in further guidance? Check out the Small Business Administration. Be on the lookout for more ‘Business School with Allison’ in the future!