Start a Small Business-
Many people get to the “great idea” stage, but can’t get beyond that because they don’t know where to go, but if you feel you have a good product or service to sell, you can make it profitable if you do some leg work first.
Research… Before You Start a Business
The first thing you need to do is check that your idea can actually work. Carefully analyze how much it will cost to produce your product and then double it. (Everything costs twice what you expect).
Look up similar products to see if you have something that people will want to purchase and what price they are willing to pay. Don’t count on producing the lowest cost product. Competing on price is a losing game. Create a unique product or a higher quality product or a product that fills a unique niche. Supplying a “want” is easier to sell than a “need”. One way to discover a want that needs to be filled is to keep your ears open. Whenever you hear someone say the words “I wish” you know a want is about to follow. If enough people have that same wish, that idea may be the basis for a new market sensation.
Find out how much time it will take to make your product and if there are any extra costs, like shipping, that might eat into your profits. If you can give numbers and facts for all of these areas and show your product to be profitable, you’re at a good spot to give your business a shot.
One big difficulty for new businesses is the cost to get started, so make sure you have the cash on-hand to cover the early costs or get a loan to help you get through the rough spots. There are plenty of lenders out there that specialize in small business loans, so you shouldn’t have a problem finding a loan if you have a detailed plan.
If you need help creating a business plan the U.S. Government operates the “Small Business Administration” which provides training, counseling, information on loans and grants and information on working with the government. Often the best strategy for getting started is to start small and see how it goes and work out the bugs before getting yourself into a lot of debt. Many businesses don’t generate a profit for the first year or two so during that period you want to keep debt to an absolute minimum.
Do You Have Customers?
The greatest idea in the world is worthless if you can’t get it to your customers. Use as many ways as you can think of to get your idea to your target customers as quickly as possible to help your Small Business get off the ground. Self-advertise locally, get your product in any shops or businesses you can, and make yourself a presence on the web. Open Twitter and Facebook accounts dedicated to your product and even get a website going with information so people outside your immediate area can start buying. Getting your name and product idea passed around is the quickest way to get consumers to start purchasing from you, so you need to get yourself out to as many people as possible as quickly as you can.
Some Guru’s suggest gauging demand for your product by running Google Adwords ads before you’ve even created a product and see what people click on and even test sales pitches. Once you find out what they want you can tailor your product to thier needs and know what kind of prices to charge and better gauge your profitability. Of course you can’t actually accept any money until you are ready to ship the product but this way you know what people want and how to sell it to them before investing heavily in a product that you can’t sell. Murphy’s Law definately applies to a new business, everything takes longer and costs more than you expect. So, you need larger margins than you ever thought possible in order to run a profitable business.
One interesting new way to raise funding (and guage interest and even find customers) for your new idea is through “crowd sourcing”. Organizations like Kickstarter.com allow you to presell your idea to potential investors not necesarily for a share of the profits but often for the priviledge of receiving one of the first items produced or simply a line in the credits page of your new movie or App. Recent items funded include a new ultra thin wallet where investors get one of the first items off the assemply line. In this case, the entrepeneurs wanted to raise $10,000 and ended up raising $203,488 because people kept ordering their wallets through Kickstarter. Other successful projects that received funding included a space age jacket that can change how much it insulates based on how much Argon gas you pump into it and several new Photography projects, video projects and computer apps. On kickstarter you won’t receive any money until your project is “fully funded” based on your initial cost estimates and what you list as needed to get started. But it is an excellect way to get start-up funding, gauge interest and recruit customers all at once. And you don’t give up a share of the business or burden your start-up with debt.
Have You Talked to a Lawyer?
Before starting a big venture like your own business, it’s always good to check with a lawyer first. A couple of hundred dollars could help you avoid any law or copyright infringement, which could save you thousands of dollars or more down the road. Knowing that your business is secure and legal will keep your business from getting bogged down in legalities as it begins to grow, which can be invaluable you’re your company becomes successful. But remember, Lawyers are by nature overly cautious. Many a good business would never have started if they had asked a Lawyer first. So keep it legal but don’t let the Lawyers discourage you if your market tests show you have a profitable idea.
Starting a Small Business takes Time and Determination
If you aren’t willing to put in the time and effort to making your business work, there’s no way it can be successful. However, even a good, well tested, idea can take a lot of effort to get it off the ground. You have to truly believe in your idea and be willing to make sacrifices to get it off the ground. If you’re willing to work hard and push your business into becoming successful, you can make it happen.
If you take the time to make sure your business is viable, find your target customers, and then put in the work and effort necessary to make your business successful, you’ll be able to turn your “great idea” into a profitable business that will get as big as you are willing to push it. You can do it if you’re passionate and prepared.
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