Who doesn’t want the opportunity to be their own boss, to set their own schedule to make as much money as you’d like and most importantly to do what you love?
But starting a business isn’t always easy as just deciding to get into business.
In fact, one of the hardest parts of starting a business is figuring our what the business really is.
While everyone wants to start a business that makes a million dollars right of the bat, it’s not likely that this will happen. It could, but it’s not likely based on the statistics.
So instead you as an entrepreneur have to figure out what it is that you want to do.
How it will work, how you will do it, how you will make money and do you have what it takes?
Most people, when deciding on a business often turn to what they have experience in. This could mean doing something similar to what you do in your career, or something that you have as a hobby. Some will switch it up entirely and do something completely opposite of what they are accustomed to.
Whatever the business is that you want to do, the idea has to be explained.
The best way to explain your business idea is to create a business plan.
Creating a business plan, being one of the first steps to get you going in the right direction of starting up your own business, it will prepare you for what is to come and of course prepare you and determine how viable your business idea really is.
One of the main reasons why a business plan is started so early on is to use it as a business viability tool.
Does your business work on paper? What are the outcomes?
A perfect way to determine the good, the bad and your short falls in order to turn your business into a successful business.
So is your business idea a viable business idea?
Here are the factors we will be looking at in helping you determine that:
- Is your business unique?
- Do you have the proper funding?
- Do you know your customer?
- How well do you know the market?
- Does the economy have an effect on your business?
- Is the timing right?
- What’s your marketing like?
- Do you need help?
Once you have the above sections covered and only then will you be able to accurately determine if your business has to potential to be a viable business.
While there are factors that can always interfere with your business and goals, preparing the above and having an understanding of your business idea in detail will only help you prepare a more secure position as a business owner.
Is your small business idea unique?
Nowadays, every regular Joe has a business idea.
But is it really an idea?
Creating a social network where people get together to talk about something isn’t really a unique idea is it? Neither is selling books online?
When deciding on a business, while it does not have to be 100% as in re-inventing the wheel don’t assume that just because somebody else did it that it will work or be the same for you.
Some of the top CEO around the world when asked if they could do it again, said “no chance”.
Sometimes starting a business and having it take off is all about timing, having good luck and being the first. But sometimes it’s not!
When you are deciding on your very own business be sure that you have a unique twist on what it is you want to do. Think about answering the question such as:
What makes you stand out from the rest?
It doesn’t have to mean that you have to be entirely unique and re-invent the wheel as mentioned but it is highly recommended to try and set yourself apart from the competition.
Be sure to break down your business idea into simple, very clear and easy to understand portions:
- Who are you?
- What do you want to do?
- Why do you want to do it?
- Who will benefit?
- How will they benefit?
- How will you make money?
- What does the future hold?
- What are the risks involved?
- Why you over somebody else?
- What makes you special?
Answering questions such as the ones above will help you understand your business and your vision and guide you into making a better, stronger business.
Do you have the proper funding?
What is one thing that every small business needs in order to startup?
If you have it, do you know how to use it?
If you don’t have it, how will you get it?
Planning with a properly developed business plan is what will prepare you for your startup and the financial situation.
Starting a small business, especially in Canada costs money.
While some businesses could be started for under a few hundred dollars and a bit of luck; an average business depending on it’s situation (brick and mortar, online, both..) could cost upwards of $50,000 to get started.
Most people thing getting into business is just quick. While it can be, it is only for those who don’t plan properly.
Since money is something that is required to startup, you have to consider all of the costs of starting and running a business. These costs can be very easily seen and thought of, but keep in mind that there are always hidden costs that most people just don’t think about when planning a small business.
What are the typical costs you ask?
- Cost to register the business and get licenses
- Registering and creating a website
- Paying yourself and employees
- Paying rent and associated bills
- Purchasing tools, supplies, inventory and equipment
- Marketing and advertising costs
Remember that the paper you write on, the pen that you use, the gas you use to get and from a business meeting is a cost associated with your business and something you should probably plan on.
As a rule of business, when discussing business startup and operational costs, it is always recommended to have 10% of your startup costs saved on the side or readily available for any unexpected emergencies.
The last thing you want is to spend all of your money and you have a problem that hurts you and you can’t afford to cover it, which can cause the closure of the business just like that.
So do you have the funds?
If yes, do you know how to use the properly?
If you need additional funding, certain sources exist that can help you obtain the funds needed but you have to be proactive and make the necessary moves to get the funding needed before you actually need it.
Who is your customer?
Who is your customer?
As part of figuring out if your business is viable or not, knowing who your customer is will play a major role. The fact is that not everyone is your customer; not everyone will have the interest in what you have to offer. So you as the business owner have to know where to focus your energy and your hard earned money and how you intend on obtaining that perfect customer.
Are your customers going to be professionals, or stay at home moms, students, kids, retirees?
Defining who your customers are will help you understand your business greatly and will actually help you make better decisions starting up and down the road.
For example if you own a pizza shop and your prefer customer is a student between the ages of 16 and 25; you probably want to be in an area close to schools versus being close to retirement homes?
Determining your customer will help you with the demographics aspect of your business.
Millions of dollars every single day are wasted by business owners targeting randomly and placing ads anywhere and everywhere. Think about it. How many times have you been on YouTube watching a video when an ad pops up and interrupts your video with something that is not one bit relevant to what you want to do? Money wasted.
You as a startup may not have the luxury of spending money on “branding” or trying to figure out who your customers are – you will need to know the target customer before you start spending the money.
Knowing your customer will also help you determine the rest of your business and the approach you take in making it a successful one.
Do you know your market?
Just as knowing your intended customer and it being a critical part of your business, knowing your market, the industry and your competition is the next most important thing.
Well the market and the competition is often what determines the success of your business.
Unless you are luck enough to find a market that is entirely missing what it is you want to do, your business will have competition. Competition does not have to be considered direct competition but can be indirect as in taking up the space within the same market.
Be sure to know the market, study it and understand it. Your competition is very important to your own success, so be sure to know who they are in detail.
Your competitors can be a great resource to you as you start your business; you can see how much they charge, what marketing strategy they use, you can see their location, what their customers are like and best of all you can even try out their products or services.
When looking at the market as a factor within your own small business be sure to ask yourself; how can I do better than the competition?
Does the economy impact your small business?
While most people starting a business don’t really think about the economy and how it may impact your business. But the truth is the economy has a huge impact on how you startup, how you operate your business as well as your customer and the market.
For example: Think about starting a home renovation business in the middle of a housing crisis or in the Canadians housing market with the mortgage interest rates going up?
Increase in minimum wages for employees has a big impact on small business ownership recently, but so do certain political aspects of the economy, the relationship of Canada with other countries, interest rates as well as employment rates.
Knowing and understanding the impact the Canadian economy has on your business is critical.
This point about knowing the economy also goes hand in hand with the next point which is about starting a business and the timing aspect of it.
Is the timing right for your business?
The timing of getting into business is crucial, especially for a startup.
Opening an ice cream shop mid-winter in January is just a bad idea but opening the business a month prior to summer time can make it the place to be for the entire summer.
Is your business seasonal? If so, be sure to time your opening right before the strongest consumer demand. Simply launching your startup then, you are papering to open the gates with a flood of new customers and potential customer who will come back for more.
If your small business idea is not seasonal and you expect to be operational year round, considering the factors placed by the economy as mentioned above, the market and the intended customer could help you plan better.
Are you a marketing expert?
Everybody seems to be online today. Do you have a website? Will you have a website? Do you have social media presence, you know: Twitter, Facebook, YouTube…etc?
If you don’t, well what are you waiting for?
Customers nowadays seem to be doing everything online; brick and mortar stores are getting less and less traffic. In fact, many store, even grocery stores are letting it’s customers order groceries straight from home and have them be “picked up” or “delivered”.
People became lazy, to a point. But it’s all for convenience.
But if you have some knowledge of how the web works, you may be at an advantage.
Your customers may be seeking you online, be sure to give them what they want. Be it that their can see your location, your hours, services or customer reviews – being present online is critical to the success of small businesses these days.
If your competition is there but they don’t have a website, get out there – create a website, get marketing going, promote like a pro. This is the way to grow your business.
Do you need help?
There is no shame to getting help with your small business.
If it means success versus failure of a business, wouldn’t you be happy to get expert help?
While hiring a business consultant can sometimes cost thousands of dollars, you probably don’t want do that, especially when your money can be better used towards making your business a success another way. But at the end of the day, if it’s what’s needed to get you to the next level, maybe it’s the only option?
Alternatively, we here at CanadaStartups.org provide our members with the extra. That extra is step by step guidance starting up, building a business plan, getting funding and more.
So take action now; give us a call at 1-800-288-9691 to speak to a small business expert, a funding counselor and somebody who can guide you and tell you about the viability of your small business.
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