5 Things to Consider before Starting a Business
Updated: Mar 19, 2020
As we experience a growth in the number of businesses being set up every day, it is no wonder why we're also seeing an increase in start-up failures. Deciding to embark on an entrepreneurial journey can be exciting and life-changing, but it can also be daunting as uncertainties and new challenges lie ahead.
Without a concrete plan, most businesses are bound to fail. But at the same time, it is also important to make a judgement and decide when to pivot in your business.
What are all the risks involved in starting a business? It's crucial to think about all internal and external risks so you can come up with a plan to manage, control and mitigate them. Risk management is important because without it, it is difficult for a company to define its objectives and decision making. Your knowledge of the risks involved will help you make more informed decision should a crisis occur.
Are you leaving a job to start a business? Personal finances, especially of the founding members of a company, is an important factor to consider before starting a business. With proper planning, personal finances can help you prepare for the worst. Your personal cash flow, budgeting and saving are equally important to your business's finances. It is recommended that you have 3-6 months of expenses in your savings before leaving a job to launch your business full-time.
Have you tested your services or products in the market before launching your business? Many first-time business owners make the huge mistake of investing too much time and money on developing a mobile application or designing a gadget, only to find that no one is interested in the product. The Lean Startup is a great book by Eric Ries, founder of Paypal, that talks about the methods you can use to test your product or service in the market before launching. This could potentially save you lots of time, money and effort.
Unfortunately, there are many great products out there that nobody knows about. With the right marketing strategy, you will be able to create a brand and tell the right story. Facts tell, stories sell. Come up with a marketing plan or speak to an expert on what it is your what your target market to know about you and how you intend to reach them. Consider all offline and online channels, and focus on how you can add value to the lives of your customers.
5. Are you ready?
The best and the worst person to work with is yourself. Are you ready to face obstacles that come your way and do what it takes to get where you want to go? Many wannapreneur want the success and glory of being a business owner without putting in the hard work. There will be times where you doubt yourself and feel completely lost. Thus, it is important to mentally prep your mind and embrace the journey. Your business will bring you places you never expected to go and you will meet people from all walks of life.
As a first-time entrepreneur, it has been an eye-opening journey. It is never easy but it is always worth it. Good luck!