Anyone that is contemplating starting a business has to focus on three specific periods. These are the past, present and future. All of which are going to have a significant impact on the business from its start, to becoming established, and finally its growth.
It may seem a little strange that one’s past could have an effect on any business that they may want to start now. But there are important facts concerning the past that are going to affect the new business.
Not everyone that starts a company has to have a business degree. But, they are going to need enough education to have taught them the skills of reading, writing and communication. All of which are essential components of maintaining a business. There are two major components of every business, which are the administrative sector and the operational division. These basic educational skills are going to be the foundation of each of these running successfully.
What experiences from the past can be brought forward to help with the starting and ongoing functioning of the business? Many individuals that have been in the workforce at different levels have learned some valuable lessons. Those that have been in the position of being an employee know first hand the trials and tribulations that they face in the workforce. As the owner of a new company that may have employees, this experience can be put to good use.
Moving into the present for starting a business now brings with it many tasks. It is undoubtedly a slow and steady process, where each step has to be carefully executed.
- The Business Concept:
Every business starts with an idea. It is the brainchild of someone who feels they have a good business concept, that is going to provide an opportunity for them in life. The hard part comes with putting that idea into a business reality. It is indeed not something that should be rushed into. Nor should it be a decision made without the proper research.
Different areas of research must be conducted. These are comprised of;
1. Determining that there is going to be a need for what the business has to offer.
2. Deciphering who the target market is going to be.
3. Researching as to where the target market can be reached and through what methods.
4. Who is the competition?
5. What is an invoice and other legalities?
- The Business Plan:
Assuming the research has provided all the right answers, the next phase of starting a company is to develop a business plan. This will serve two important purposes.
a) It will act as a blueprint for going through all the different phases of starting the business, getting it established, and forecasting for its future.
b) It can be used as support for obtaining start-up financing for the new company, or for cash flow if and when needed.
- The Legalities:
Every business has some form of legal responsibilities that the new owner must be aware of. This starts with choosing the business name. This means being diligent about doing a company name search, and then registering the business.
Here, there are going to be some options. Such as whether the business will be a sole proprietorship or a corporation. The entrepreneur may need some help making this decision. There are resources such as the accountant who is going to look after the financials of the business that can help with this decision. It is also a good idea to choose a company lawyer as they may be needed for some of the startup legalities.
- The Finances:
Most often, the new business owner forms tunnel vision when it comes to starting the business. Their main focus is on start-up costs. It is essential to know what these are. But, there are other considerations when it comes to finances. This includes recognizing that there is going to be enough money left over after the launch of the business, to sustain it during at least the first few months.
The business owner has to know whether enough money is going to be available for living on, while the business is getting started. Then, finally, if there is not enough money on hand, what resources are open to the new business owner to get it started properly? It is imperative that a budget is developed and adhered to as strictly as possible. Ideally, it should include some contingency money for the unexpected.
The next big decision is the location of the business. Some may go with a bricks and mortar establishment. Others may decide on an online business. Then many go for both. Each of these requires their own approach and a specific amount of investment. The method for each needs to be well thought out and planned for carefully. They each should have their own mini business plan.
- The Two Major Components of the Business:
There are two major divisions of the business that are going to demand equal attention. These are the administrative section and the operational division.
The business owner has to be in control of both of these. If one of these fails, then it will have a direct effect on the other. It means having the proper staff on board who can address the needs of both of these.
Some new business owners start out wearing the two hats required for the business, but if the company is going to grow, this can only be a short temporary situation.
The delegation of responsibilities is a task that every new business owner faces, and one that can come with some challenges. It is difficult to put segments of the business in the hands of someone else, but that doesn’t mean that the business owner does not maintain control.
As if there isn’t enough to think about for the present with a start-up business, the future also has to be considered. There are two important phases to this.
- Avoiding the Pitfalls:
Many mistakes can be made during the present stage of starting up a business that can affect the future of the company negatively. These include;
- The Pitfalls of the Business Plan:
While the business plan should be concise, it should not be overwritten. Being too in depth with the business plan can reach the point where it is overwhelming and intimidating. Starting a new business is undoubtedly exciting, but it is also stressful. Having a point by point business plan, to begin with, will keep it simplified, and it can be expanded upon later if needed for financial purposes.
- Not choosing the right business name which can lead to problems with branding. Or worse still, legalities in regards to someone else having the rights to the business name.
- Not being informed of the legal aspects of the business. The government is going to have set rules and regulations that pertain to your business. If you are not really aware of these, then it can end up with fines or other legal courses of action being taken against the company.
- Not finding the right location. It is true when it is said that “location is everything”. Those that are doing business only on the internet have to be concerned with virtual location. If the new business owner does not know how to do proper internet marketing, it will affect the growth of the business.
- Having to scrimp on essential elements of the business now, because of a shortage of money, will have a future impact on the company.
- The Growth of the Business:
While for the new business owner it may seem overwhelming to have to think about the future growth of the business during the startup, it is still a necessity.
There have to be objectives and goals set for the business. This means forecasting the future. It doesn’t mean that the company will fail if there are flaws in the future projection. But, what it does say, is that by having projections, the new business owner is able to decide if the business is on the right track. If it is not, then changes can be made immediately to have the company take a different direction. Or, to identify what the weaknesses are and correct these.
While it may seem a little daunting to have to consider all of these points they are critical to the success of not only the start-up of the business, but for getting it established, and allowing it to grow. If this information is approached in a step-by-step manner, then the new company startup should proceed seamlessly and flawlessly.