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A lot of people dream of owning their own business. There's the hope of achieving financial independence, of course, but just being your own boss is also an incredibly attractive prospect. However, going into business for yourself won't be a cakewalk, no matter how good your business idea is. Before you decide to take the plunge, you need to make a comprehensive plan for how you're going to make things work. Only if the plan looks workable should you decide to take the plunge. This plan needs to have these four elements:
Work out an Initial Source of Capital
Profit isn't going to start happening right away. In fact, it probably won't start happening for a long time. And that means you need to figure out where the money to run the business (and to live on) is going to come from during the early days. So the very first thing you need to do is work out exactly how much you need to live on and how much your business will cost to run each month. Next, you need to figure out how you're going to get it.
If you have savings, you could consider living off of those, if you have enough to get by for at least a year, if not two or three. However, if you do, and if your business fails, you won't have any more savings. Having friends and relatives you could mooch off of for a while could help, but it could also strain those relationships.
It may be best to keep your day job while you start your business. Spend weekends and the hours after work building up your new business. Cut back a bit at your day job if you can, and use the extra time to work on your business. You may not be well-rested, but you take the fewest risks this way.
Work out Where You Are Going to Have Your Office
Depending on what kind of business you plan to start, you may be able to work from home, at least during the early years. This has certain advantages, not least of which is the fact that you don't have to pay for office space. However, there are some challenges when it comes to working at home, too. Home life is sometimes full of distractions, like TV and family, that can make it difficult to get work done. So, if working from home is not going to work out for you, you need to find some other office space.
If you own your own home, you may be able to build your own office space in the backyard with a shed kit. They're not too expensive and would give you a secluded, quiet space to get your work done. If you can't do that and can't work in your home, then you're going to need to find a way to rent a space in town somewhere. You may be able to rent office space on a daily basis. Some storage unit companies have branched out into short-term rentals of office space for small business owners. That way, you're not paying for any more time than you use.
Figure out How to Get the Help You Need
You may be able to do everything yourself, at least at first. That is certainly a great way to save money. There are two potential problems, though. One is that you can really run yourself into the ground this way. The other is that you probably don't have the training or experience to do everything yourself very well, and your business might suffer for it. You need to make an honest assessment of how much help you need.
If you can't do it all yourself, you need to determine how you can get the help you need without spending too much. Hiring full-time or part-time staff is one way to go, but you should hire freelancers whenever you can. Paying freelancers by the job is frequently a lot cheaper than hiring permanent staff. This is especially true for small businesses. Also, with freelancers, you don't need to spend time looking for and training new hires.
Develop a Marketing Strategy
Aside from actually providing the goods or services you are selling, nothing is more important than marketing. After all, if people don't know your product or service exists, they can't buy it. You need to advertise as extensively as possible. Of course, with a small business' resources, that's not going to be very extensively. And that means you need to use your advertising budget very efficiently.
A big part of your marketing should be done online. Not only is that probably where your target demographic spends a lot of time, but you can also reach a lot of people for very little money that way. Pay-per-click campaigns, for example, only require you to pay when a viewer actually clicks on your ad. However, you can't just advertise anywhere and everywhere online. Different demographics use different social media sites and visit different places. You need to find out where your demographic can be found and advertise only there.
You also need to learn how to do split testing or hire someone who can do it for you. Split testing is the best way to fine-tune your advertising campaigns and figure out what works and what doesn't. You can use it to get the most bang for your advertising bucks.
The Takeaway
Starting a small business isn't easy. There are a lot of reasons why small businesses fail. If you want yours to succeed, you need to make a solid plan before you even get started. Never leave things up to chance. Never engage in wishful thinking. If you plan carefully, your small business just might be one of the ones that succeed.
