If you are planning on opening your first small business, there’s a few things you’re going to need to know before you take the plunge. If you don’t know exactly where to start, here are five factors to consider before starting a business.
- Are you passionate about the product or service you are providing? If you expect to keep your business running for a long time, then you really need to believe in what it is that you’re doing. If you want to run a restaurant business, then you need to be able to like the food that you serve on a regular basis. If you are opening a furniture business, then you need to be passionate about buying and selling furniture and the changing trends within the trade.
- Is there a genuine need for the product or service you are providing? Of course, it’s most ideal if your business serves a higher purpose that will improve the lives in your community, but what you also need to know is if your community has a desire for what you’re selling. If you want to open an online business, then your customers are not part of a local community, but rather a demographic of people with similar interests. That’s why you need to get an idea of the basic supply and demand.
- Exactly how much seed capital will you need? Before you can even go to the bank to apply for a loan, you need to do some serious homework. If you are opening a brick and mortar business, you need to look at vacant commercial spaces in your community and get an idea of what your rent costs will be. If you need to buy any equipment or raw materials, you need to know how much that will cost you. You may want to seek the expertise of an experienced accountant to get a clear idea of all the expenses you will need to add up.
- What kinds of permits or licenses will you need? Depending on the type of business you would like to open, you may have a few different permits or licenses that you will need to get before you can open your business. If you don’t have the proper permits and licenses, your business could be shut down before it’s even had a chance to start making sales. For example, if you don’t have a liquor license and you start serving cocktails, you could find yourself in major trouble with the law, and with major fines to pay.
- What will the main demographic of your customers look like? You can’t have a strong business if you don’t have a strong marketing plan, and a good marketing plan starts with knowing your audience. You want to know what gets your audience excited. You need to know both what attracts them, and what detracts them. You can get all kinds of marketing ideas for your business from FranchiseExpo.com.