It is a dream for many people to own their own business. Some people are happy simply to work for themselves and freelance, while others see themselves building a business from the ground up, employing their own team, and watching the company grow.
Running your own business is possibly easier now than ever before. With the advent of the internet and a multitude of selling platforms and WYSIWYG website builders, it is possible for nearly anyone to open a shop online. Some people will prefer to build a traditional land-based business and others possibly a combination of the two.
Whatever your preference for the form your business takes there are somethings that need to be implemented. Regardless of whether you have an internet business or a brick-and-mortar store, you will still need to understand and go through certain procedures.
Is there a need for your business?
You may be able to make the most incredible donuts, but if there are already twenty established vendors in your area doing the same, is there really any room for you?
Take your talents and look for a way to improve on what your competitors are already doing or find some way of doing something that no-one else is. Having a unique selling point, gimmick or strong idea will help when you formulate your business plan for investors.
Build a solid business plan
You need to have a strong plan and strategy for your business. Not only is it about your product or retail idea, but you also need to know where you are going and who you are targeting.
For your business plan, you will need to show how you will make a profit and how long it will take for your company to become profitable. You have to show realistic sales targets and projections. You need to describe exactly what your business is and what it will do. Here is a brief list of things to put in a business plan:
1) Business Summary – Brief explanation of your services or products, employees, location, and financial plans. This is where you outline why your company is going to triumph.
2) Opportunity Description – Show here what your company is going to do and how it will fill a hole in the market. If you have a solution to a problem then explain it here in detail. Also, explain to whom you plan to provide your services.
3) Execution – Explain here how you will actually achieve your aims. You have already explained that there is an opportunity available now you need to show that you know how to take hold of it.
4) Financial Projections – Be realistic, there is no point in stating that you will make millions of dollars if you don’t have the figures and data to back these claims up.
5) Marketing Strategy – Explain here your plans for advertising and building your brand, and attracting customers.
6) Appendix – Your chance to include any extra data, photos, or anything else that may help to explain your plans.
Even if you aren’t looking for an investment you should still write a business plan so you can see clearly how the business should progress.
A very important step is to learn how to create a budget for your start-up business. You must make sure there are enough finances in place for the business to operate but without getting yourself into financial difficulty. There are 4 main options for financing your business and you can combine any of these together to find the best choice for you.
1) Self Financing – Just as it sounds. This is where you use your own savings to finance the business. This means no debt but maximum risk if it goes wrong.
2) Crowdfunding – Increasingly popular way to raise funds for a variety of reasons. Initially, crowdfunding was used to raise money for charitable causes but now many use it for start-ups or to help launch new products.
3) Loans – For this, you can approach banks and organizations such as the SBA to help with getting a small business loan. Of course, if the business goes wrong you will still have to service that loan.
4) Investors – Sometimes called angel investors, these are people or organizations that specialize in businesses and in return they receive a slice of the company. You will need to show a strong business plan, as although these investors speculate they still want to make money not lose it.
How you finance your business will depend on your own requirements and whether you wish to give away a share of the business. Bringing in an investor may mean receiving business advice and experience too.
Online business or traditional land-based?
In the past, it would be an automatic choice of renting or buying a building to run your business from. Nowadays, things aren’t so simple. Covid has left many high streets without the footfall from previous years and also some businesses just work better online.
Think about your product or service and decide how you see your buyers. In some cases, your business might demand both a website and a high street presence.
Advantages and disadvantages of running a business online
If your business is suited to the internet then you may find this is the best option.
Less overheads – no business rent, work from home
Less staff – potentially less employees as many systems will be automated
Choose your own hours – No need for a store to be open as the site is 24/7
Build your own store – You can use WordPress & Beaver Builder to make a website for very little outlay
No face-to-face – you never meet your customers
Storage space – if you have stock you will need somewhere to put it
Life/work balance – you could end up spending all your time at home
Hiring a web agency – if you don’t have any computer skills building a website could be expensive
Advantages and disadvantages of running a brick-and-mortar business
Meeting your consumers – you can build a rapport and get to know your patrons
High street presence – people will see your business and it will be talked about
Job creation – if your business grows you will be helping by employing people
Leave work behind – you can go home at the end of the day and switch off
You need a website – It is likely you will still need to pay for a website
Higher outgoings – electricity, water, rent will need to be paid along with local taxes
Limited hours – you can only sell or provide services during opening hours
Travel – depending on your location you may spend a lot of time traveling to and from work instead of being productive
Setting profit margins
If you are selling a product of your design then you need to choose a manufacturer and work out how much profit is going to be made. If you are providing services it is different, but with any tangible product, you will need to work out how much it costs to make and how much you can sell it for. A margin calculator can help you to see the profit you make on any one of your products.
This is vital to know because poor accounting and limited knowledge of profits could mean that your seemingly thriving business is actually making a loss.
You will need to market your business. You can use print and digital marketing to help push your business forward. Look at low-cost and free options too such as social media advertising. Build a Facebook page and keep it updated with new products, special offers and answer any questions your buyer’s post. A digital marketing agency can help you develop a strategy to get your brand out into the open.
Never ignore reviews, even the bad ones. Some online sellers buy fake reviews to push their products, but you should look to build a solid genuine base rather than take shortcuts. Build rapport with your customers by replying to reviews and interacting with them. If someone had a bad experience then write on that review and explain what happened. Take criticism on board and look at areas to fix. If you receive a good review then say thanks. You can create loyalty between you and your consumers this way.
Share the workload
When the business is taking off then make sure you delegate and employ good people to help. You cannot do everything yourself. Taking a step back will let you see the business as a whole.
If you are planning to start a business then make a strong plan, find a niche, budget and gain investment and work out your profit margins. Once you have all this in place it is time to sell your services or products and fingers crossed, you will have a successful business.