So you want to start your own Small Business.

So you have a grand idea that you know will make you lots of money. You’ve always wanted to be your own boss, to write your own cheques and become financially independent, but like many others you’re not sure of how to go about starting and running your own business. Contrary to what many believe, starting a business is as easy as getting the right information and researching the market and industry you plan to be a part of.

In business there are no guarantees, and no one can eliminate the risks that come with starting a business, but with proper planning, preparation and insight you could be well on your way.

Over the next few weeks, we will explore various aspects of starting and running a small or micro business, starting this week with an overview of the things you need to consider as you venture in the exciting world of self-employment and business.

Before you start Your Small Business… The Dos and Don’ts

Before you even think of investing one dollar into a business idea, you need to write a business plan. Many times, people planning to start a business get so excited with their idea that not enough time is spent doing the necessary research to make sure those ideas become reality.

Many of the seemingly crippling problems that pop up in the early stages of running a business can be avoided if your thoughts are documented in the form of a simple business plan.

A business plan defines your business, and serves as the business resume. The basic component includes your marketing plan, production plan, income and cash flow analysis and general start-up information. It will help you allocate resources properly, handle unforeseen complications and make good business decisions. A plan provides specific and organised information about the business you are about to start. This document is crucial if you need to finance the business operation. Additionally, it informs sales personnel, suppliers, and others about your operation and your goals.

LOCATION

When the time is right for you to launch that business, your location is important. Before setting up shop at home, a friend’s place, a relative’s place, or in a rented premises be sure to do a location analysis. Make sure the business environment will be right for the growth of your business. Do a simple study to make sure that you are not selling an excellent product to a community that will not appreciate it.

You, your product and your location and the communities you serve must harmonise. Also bear in mind that in today’s economy it may be necessary for start up businesses to share business space. Sure you want to put the key in your own door and say proudly ‘this is my place’, but it is just not practical for most businesses today and that’s why many small businesses fail. Look around for an existing small business that complements what you do and offer to share the space with them. You can share cost of rent, utilities, salaries and management time until your business is strong enough to manage on its own.

FINANCING THE BUSINESS

Once you’ve got your business plan in hand, the next step will be financing the business. Sometimes the idea for your business comes at the right time but you need to wait before you actually start the business because you don’t have the money to start the business. Never start a micro or a small business with borrowed funds. Borrow money to expand the business but not to start. If you are not financially prepared and you don’t have the money, then an opportunity is not passing you, the time to start the business is not now. The worst thing one can do is to start a business with not enough money and hope that it will work. All risks must be calculated. Business is not a game of chance.

DONT QUIT

Never quit your stable job to start a business. Moonlight. To ‘moonlight’ means to start a business or provide a service in your off hours while remaining employed at your current job. The benefits of doing this are obvious – you can maintain your regular income, your retirement, health, and vacation benefits while exploring the possibilities of your own business and raising extra funds. Moonlighting is hard work though, so if you can get your family and friends involved to help take some of the pressure off you, it will help you along the way.

SEEK ADVICE

There are so many other things you need to know before you invest your first dollar, so consider speaking with a Business Counsellor. A business counselor will be able to guide you as you forge critical links with professional organisations and as you begin to go through the formal registration process. A business counsellor is like an architect; you tell them about your dream business, and they will look at your resources and help you develop a plan based on the money you have or have access to and according to your needs, and they can also give you an idea of the end product before you begin.

More tips.

Take your time and wait for the business that is just right for you. You will not be penalised for missing opportunities. Look for a business that will grow in today’s and tomorrow’s market. Don’t be impatient. Do not let overconfidence short-circuit you from selecting and analysing the selection of business carefully. You mustn’t be afraid when you hear about the negative aspect of business. It is better to be aware so you can face or avoid them. Be realistic. Do not become lured by rewards. They will come once you choose the right business and you understand every aspect of the business before you open the doors.

Andrea ‘Anniegee’ Graham is a past president of the Small Business Association and is currently the CEO of the Small Business Development Agency. Email her at smallbusinessdevelopement@hotmail.com