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| Getting Started |
Homework Helpers: Research To Do Before You Launchby Ty Freyvogel Starting a business can be a little like peering out the door of the airplane before you jump. Its uncertain, scary territory and you can't be sure if your parachute will open until you're already in the air. But take heart. The fact that you are courageous enough to risk the entrepreneurial leap already speaks volumes about your character. Just be aware that bravery and ambition alone aren't enough to pull you through. You wouldn't expect an actor to perform the role of Hamlet without first rehearsing the role, would you? Likewise, you cannot launch your dream business without first preparing your course of action. You must do your homework!
Get my point? Had I done adequate research on the business I would have seen the technological advances in the works and known how risky this potential venture would be. Don't make the mistake I made. You must learn everything about your future business in order to keep it afloat, and even after all of your research, you will still stumble upon surprises. You cannot be too prepared! Keep reading and I will teach you how to do all the research you need to make sure that your business is a successful one. Make absolutely certain there is a market for your business. Unless your company fills a need in the community-whether it's a literal geographic location or an international market niche-your efforts will be wasted. You don't want to put a kosher food mart in an area without a Jewish population and you don't want to sell widgets to an industry in which widgets are on the brink of obsolescence! Determine who your target clients are and then determine whether or not your business will attract them. For example, if you want to sell a consumer product, go to a busy shopping mall and pass out samples of your product and note how the people respond. Poll these people about whether or not they would visit your establishment based on their current lifestyle, finances, and interests. You can never be too informed about who your customers are. Plus getting to know them will help ensure that they remember you when your company is up and running. Ignorance is not bliss. What you don't know can kill your company. As I previously mentioned, not knowing enough about the field you are getting into can be a fatal mistake. Do as much research as you can before you dive in. Subscribe to industry magazines and talk to other business owners in the same field. You might even try to be an apprentice or get an internship before you take the plunge so you can be absolutely certain you know what you're getting into. You can't know too much about your future profession. Take your research seriously. You'll be glad you did when the profits start rolling in. Start looking for your money source. Though it sounds like I am stating the obvious, starting a business takes lots of money, so you must either start saving your pennies or find an investor. Sometimes you actually can fund your business by your self. Countless entrepreneurs who have gained thousands, if not millions, in capital started out with only a few thousand dollars and were able to make it grow. But for those of you who need more money than the average Joe has lying around, an investor is the way to go. Don't worry: if your product is good enough and fulfills a need, chances are you can find someone to support it-an angel investor, a partner or even a wealthy family member. If you believe in your product, someone else out there with deep pockets will believe too. Consider finding a partner. You may underestimate just how much work is involved in starting your own business. Understand that for the first several months you will be working nonstop and playing the "catch up" game. Having a partner can remove much of the responsibility burden from your shoulders and keep you from becoming too overwhelmed. He will provide another logical voice and an able body to help you make decisions and carry out tasks. One partner, other than yourself, is ideal and you should never have more than two partners. Businesses operated by more than three people will be difficult to run because there will be too many ideas, too many disputes, and too many egos to deal with. So find a person with similar short and long-term goals and get to work to make your summertime lemonade stand a reality. Build a business plan. This handy blueprint of the steps you will take doesn't just outline your entrepreneurial aims for your own benefit. It also will help potential investors or "angels" envision your goals. A business plan shows angels how serious you are and gives them an exact idea of the brilliant products their money is going to help create. For instructions on how to make a business plan, please read the article on this website titled Step 1: How to Write a Business Plan. Don't assume that one formula works for all businesses. This is another lesson I learned the hard way. There are countless ways to become successful in opening a new business. A million different methods bring people financial success every day. Unfortunately, not all formulas work for all companies. You would never start up a franchise bookstore the same way you would start up your own makeup line. If you are confused, show your business plan to a mentor who already has a similar enterprise up and running. Successful people love to talk about their success, so cash in on this opportunity. You will come away very well educated and hopefully inspired as well. Think about your "store hours" before you hang your shingle. Take some time to consider the kind of hours you intend to keep for your business. If you work in a field that serves the public and you are open 70 hours a week, understand that you will spend 70 plus hours a week keeping the customers happy. The restaurant business is a perfect example. Owners who also manage (and if you're just starting out, this means you) spend the majority of their time on site, dealing with customers and employees. (And chances are, when they're not at the restaurant, they're worrying about what disasters might be unfolding in their absence!) Add to this hectic workweek the additional time it will take you to do the other behind the scene "housekeeping" (bills, taxes, restocking, etc) and you will realize that you have no time for rest, fun, and family. If you plan to eat, breathe and sleep your work, perhaps it's okay to hang an "Open 24 Hours!" sign (literal or metaphorical) outside your place of business. Otherwise, it may be better to have your shop hours set up in a nine-to-five format. One of my favorite sayings is "If you don't run your business, it will run you!" By establishing manageable hours of operation, you will save yourself countless hours of stress and anxiety just trying to get it all done. I hope you are not too overwhelmed by the steps it takes to start a company from the ground up. My intention is to prepare you so you will know exactly how much energy you will need to put into your dream. The work is hard, but also very fulfilling. In just six months time, you can easily complete the above checklist and be well enough informed to start your project. And finally, may I mention that no matter what your goal is, make sure you are fired with passion for it. Remember that you will be spending your days and nights investing in this business. It should be something that fills you with curiosity, joy, and excitement. You are now ready to begin your research, so sharpen your pencil and your wits and go learn about your dream. |
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Did you enjoy this article? Smarts, Guts and Luck features 25 chapters brimming with tips, insights and sound advice. Find out why Cindy Potts of The Retailer's Advantage says "Ty Freyvogel has a formula: 1/3 Smarts, 1/3 Guts, and 1/3 Luck add up to exactly what you need to make it as an independent business owner. In a short gem of a book, Freyvogel delivers countless secrets for success, ranging from developing one's intuition to recruiting the ideal employee and balancing life and work. There's a lot of powerful advice in here that speaks directly to the reality of being an independent business owner."
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If you've read some of the other articles on my website, you may already know about my own big mistake: I once joined a venture solely because the business model fit perfectly with my previous experience. I figured because I had succeeded once in a multiple location service business, naturally I could do it again. So I bought an automobile service-related franchise. But because I hadn't researched this company in particular, and the automobile industry in general, I had no idea that new technology in carburetors would soon make the need for our business obsolete. Our profits plummeted and needless to say, the company failed.
