5 Tips for “Building” Your New Business

5 Tips for “Building” Your New Business

Make sure that you are careful of these things BEFORE you venture into the world of the business owner.

Building a new business can easily be compared to building a new house. Whether you are starting a “BRICK-AND-MORTAR” business or a HOME-BASED business, it is similar in that the business must cater to the needs of those who patronize it, just the way a home must address the needs of those who live in it. People are looking for comfort, convenience and a pleasant experience when they dine or shop for goods or services. In today’s economy, value is extremely important. Time and money are both coveted commodities.

As a potential business owner, these are some important things to keep in mind before you take that important step:

1)“Location, location, location”…an expression that applies not just to homes, but also to “brick-and-mortar” businesses. Companies spend huge amounts of money studying an area’s demographics before locating their business or franchise there. Ask yourself if there is really a need for what you are offering. How much competition will you face?

2) Careful Planning. You wouldn’t just show up one day with your hammer and expect to build a house. You must first have a plan . You must know how much inventory to purchase and where to purchase it. No matter how optimistic the projection of future sales is, always underestimate those sales. Always allow for expenses to be higher than you anticipate.

3) The Foundation: Have enough capital. Just as you wouldn’t start a house without a strong foundation and enough money to finish it, you should not start a new business until you not only have enough to fund it properly, but also enough to support yourself and your family at the same time.

4) The Structure: A good homebuilder always keeps track of his expenses. Accounting and knowing where your money is spent is even more important for the business owner. Bad bookkeeping habits can cause a business to fail before it even gets off the ground. Keep a close eye on credit accounts and try to pay invoices as quickly as possible to avoid interest and penalties. Remember that you will be paying your own taxes now and the last thing you want is problems with the IRS!

5) The Roof: Your business needs protection just as your home does. Make sure that you have adequate insurance to cover any potential disaster. It is also wise to get legal advice on how best to keep your business separate from your personal assets.

With a “BRICK-AND-MORTAR” business, whether it is a “Mom and Pop” business or a franchise, you can probably assume startup costs of $30,000 plus, with established franchises significantly higher. A few websites to help you get started might be:

www.entrepreneurs.about.com

www.franchisedirect.com

If your choice is a HOME-BASED business, one of the fastest-growing segments in today’s economy, the new entrepreneur often needs far less money for startup. Depending on the business, it can even be as little as $1500.

Your basic needs for a home-based business will probably be just a computer and a telephone. It can even be run from a corner of your living room, if necessary. I would suggest, however, that you try to find a spot as free from household noise and traffic as possible. (Headphones are always an option!) Also, it is important to set aside a specific time of the day that will be devoted only to the building of your new business. If you are presently working at a job that you plan to keep until your business gets rolling, then perhaps that time will have to be nights and weekends. Self-discipline and training yourself to ignore distractions will make the process much easier.

Apart from location, the other considerations for building a business still apply….planning, capital (although you won’t have the same overhead you will probably still need a budget for supplies, advertising, etc.), good accounting, and protection from unforeseen events.

You will also need an extra measure of self-discipline. If you are still holding a job when you first start your business, set aside a specific block of time every day that will be spent on building your business…and STICK TO IT.

Building a business of any kind involves hard work and real challenges. As an entrepreneur, you must accept and embrace those challenges and continually move forward. You may fail at first but, if you keep pushing through with enthusiasm no matter what, you will eventually taste success and it will be ALL YOURS.

If you are a self-starter there is more information available about the freedom and financial rewards that can be yours.

To your success,

Wendy Tait

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