When it comes to running a start-up, it’s important to plan ahead. Although you will, inevitably, make mistakes all the way, you are more likely to succeed if you have a clear strategy and execute it in the correct manner. The majority of start-ups and new businesses fail within their first five years, so it’s vital that you do everything you can to stand out and make a splash in your new industry.
Below, we’ve put together a checklist of nine important factors to take into consideration when launching your own business. Read on, as this information could help you decide whether or not it is the right time to fund a new business start-up.
The location of customers
Many start-ups market their products and services toward local clients, but in an increasingly competitive world, the chances are that your business will want to widen your audience to maximise your chances of success. If you’re considering promoting your brand to customers abroad, then don’t forget to think about legislation, taxes, postage and international phone calls. However, there are a whole host of online tools to help you reduce overseas business costs – including websites like Planet Numbers, which offer the ability to make free international business calls – so use them to your advantage to reduce your overheads.
Feedback from potential customers
Without getting feedback from potential customers regarding your product or services, the chances are that you are going to make mistakes. Before starting up your new business, you should conduct in-depth market research to decide whether or not there is a demand for your products. It’s easy to make the mistake of going in all guns blazing without understanding the exacting needs of your customers, so spend time perfecting your product or service before sending it to market.
The state of the marketplace
Before you jump into a new market, analyse the current pros and cons of the industry. If you are launching a digital business, you need to take into account competitors and multinational companies that could easily take your business. The more background you have in your industry, the better protected you will be against the unexpected, so sign up to industry-related blogs and news websites, network with individuals in similar fields and always keep your eye on the ball.
Competitors
Conducting a competitor analysis is essential if you want to launch a new business, and you should never go into a venture without knowing who your rivals are. Perhaps they’ll execute an aggressive marketing strategy to damage your reputation from day one, or maybe they’re about to secure a contract with a client that you’ve been trying to win over before launch. The more you know about what’s going on behind the scenes, the better the chances you have of success.
The need for your product or service
There’s no point in starting a new business if you cannot be sure of the demand for your product or service. Conduct in-depth customer research and develop your unique selling point so that you can use it to market your new business and differentiate from competitors from the offset.
The financials
While this is one of the most obvious considerations to make, figuring out your finances is essential. Create a financial plan and account for every aspect of your business – including premises, marketing, recruitment, training and customer retention – and don’t be afraid of speaking with an accountant. If the numbers look good, it’s time to secure funding and start your new venture – if they don’t, it’s back to the drawing board.
Your previous industry experience
Knowing your industry is important, so consider how much experience you have before you make the leap into business management. You may know how to use Twitter, but can you implement a successful social media marketing campaign to increase leads? You might have experience managing a small team, but do you have the capability to recruit and train staff in a competitive industry?
The scalability of your ideas
Even if you have a unique business idea, it means nothing if it cannot be scaled. Building a scalable business can be challenging, but it’s the only way to secure funding and grow your business. Before investing any money into your start-up, take the time to analyse whether or not your business has the potential for growth – if it cannot, you should reconsider your strategy and find a solution.
Staffing requirements and management structure
Although many start-ups are a one man job, the chances are that you will soon need to recruit somebody to assist you in your growth. Whether that’s in customer service, marketing, front of house or technical, be prepared to add staff to your original business plan – and consider what impact this will have on your cash flow. The more workers you employ, the more risk you will have associated with your business plan, so consider outsourcing non-essential jobs like web design and marketing, and ask friends or family to help you out with tasks that you can’t complete on your own
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Licensing and legalities
Before you launch a new business, you should take the time to get to grips with business and enterprise laws, and consider any potential difficulties that you might face. For example, you may need a specific license to trade in public areas, or you may be required to submit trademark requests to protect your brand. Solicitors can be expensive, so the more you know about the legalities surrounding your business, the easier and cheaper it will be to manoeuvre through the process.
If you’re ready to launch a start-up or fund another’s, it’s important to keep a close eye on every detail of the business. Remember to hold regular progress meetings, analyse the performance of your new recruits and keep your eye on your competition and wider industry trends. Good luck!