7 Fundamental things to do right before you start your business

2013-07-30 02:13

Starting a business is very exciting. But it is also a very difficult long-term project. So while there is quite a bit of excitement and temptation to start as quickly as possible, some proper preparation can help you avoid costly mistakes and help you start with solid fundamentals on which to build on. Plus, identifying and fixing problems during the planning stage, is much cheaper and simper than doing than when your business is in motion. Legal issues

Every country, city, and state has different laws and requirements when it comes to starting a business. But they are all similar in that there are some regulation and taxation issues that federal and local governments impose on small businesses. And it is up to the entrepreneur to determine what those requirements may be, and determine the best how to best handle that depending on what the business is in when it comes to company legal structure, ownership, and revenue/taxation implications.

Put the business idea through a real thorough test

You have to talk to as many people about your idea as possible. And these have to be not just people you know, but also business experts and preferably business experts who have created a business that is in the same business niche in which you are starting your business. Whoever you talk to, try to listen to what they have to say without debating them too much. Try to absorb the feedback they give you. You do not have to take their advice, but you should definitely extract as much as possible from their advice so that you can think about it and make your own conclusions. Here is a full article on how to tell if your business idea is good.

Build a solid well-rounded team

It is extremely difficult to build a business on your own. Someone needs to fully focus on the marketing and promotion. Another person needs to fully focus on creating the product and making it the best it can be. And if there are other big jobs depending on what the business is, then likely that may need another person as well.

But building a team is a subtle and complex task. For best results, all team members must be hardworking and experienced in the role which they will have in the business. Additionally, the team members should already have worked together before so that they know what to expect from one another, and there are no surprises when the team gets started, like finding out that one person is used to working 40 hours a week and another 80.

Additionally, don't over-build your team because people are friends, supportive, or nice people. Only bring people onto your team who are A players.

Research the market

Market research is extremely important. You must research who your target users are, how big the market is, and who your competitors are. In addition, you must research the history of this market. For example, if there have been many companies which have attempted your business idea in the past, and none of them succeeded, that could be a red flag. You should find out why they failed and make sure that you do not repeat their mistakes.

Study your target consumers very deeply

Studying your target customers is a part of getting to understand your market. But this is so important that a whole section is devoted to it, and I mention it in almost every article I write about business ideas or starting a business. Every business owner must study their target customers, and get a very deep understanding of who the true customers of that business are.

You must understand their motivations for becoming a customer, their comfortable price points, what they need, how they need it, and when they need it. If you can understand those things, you can create a product that delights them. But the benefits don't end there. You will also be able to market your business to them because you will have a great understanding of how to reach them.

Understand how you will make money

It isn't enough just to know that you will sell something or provide a service and charge for it. What you must understand is the volume of such transactions needed to get the business reach your financial goals for it. That means you must understand the costs to produce each sale, and how much of the revenue you will keep as profit.

The reason this is important is that if you go into a business thinking that you need to sell 1,000 items to reach your financial goals, but in reality, you would need to sell 500,000 such items, then that would be a very negative surprise to learn about as you are building your business. It would necessitate a complete change in strategy which is an expensive thing to do when you are in the middle of running your business. So try to understand your financials before you start.

Enjoy your business

Before you get started, think about whether this is something you will enjoy doing for a long time. If you are successful, that is precisely what is going to happen. So make sure the business can give you enjoyment. If you are passionate about the business, it will make you stronger as an entrepreneur and a leader for this business.

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