Wednesday, December 5, 2012

Bright idea to Big Business: Five Beginner Tips

Bright idea to Big Business: Five Beginner Tips

Some of us have dreams of owning a business.  We have some special gift or talent that we have that we want to capitalize on or just something we enjoy doing.  Some of us have done the entrepreneur thing before and maybe were not as successful as we wanted to be. ----- (That would be me).   Some of us are just tired of working for someone else and want to make our own money.  Whatever your reasons there is a point in time when that idea must become a reality. 
Here are five tips for those that just need help getting started. 

Tip # 1: Be a Know it All ……(About your Business)

 First you are going to be the expert in your business so be and expert and educate yourself on your industry. Market research can be really insightful, especially about the future of your business/ industry.  It would be very uninformed to go into the DVD rental business right now because the industry is declining rapidly and the market is drying up for this type of business.  If you are determined to get in this industry then gaming and Red Box leasing might be a better place to start researching. 
There are some legal and structural things that must happen in the beginning or start up phase of a company,  to help you to stay compliant, advertise, and be in business.  The best “worst” advice out there is to just start selling something …..”Just go out there and do it”.  Well, an experienced business person will tell you this is almost the worst thing to do first.  The very first thing you should do as a person going into business is ask questions…lots of them.
I have given you a couple that are kind of universal to start your mission.

  •   Do I need a business license to do this? ( Call your County Business License Office)
  • What industry am I in? What are the demographics of my customers?

This information can be found by doing some industry research at the local library, college, or Chamber of Commerce.  Depending on your finances, you could also pay for industry reports which many market research companies publish.  In every business there is a typical consumer.  You must know where to find these people.  The internet and social media has made this task easier but still you have to seek this information out.  Also you must have your product and or service ready to present to the customer.
·         What is the best area for my business?
·         Who is my competition?
·         What documentation do I need to get licensed?
Most counties require identification, place of business (POB), phone number, an agent (person responsible if trouble comes), a lease or proper zoning, and an estimate of income from business.  If you plan to get a bank account then most will also require a business license, A Federal Tax Identification Number (FEIN), and a state issued legal document.  This document explains the nature of your business and legal structure.  If you decide to do a sole proprietorship then some of this is bypassed but remember you are taking personal liability for anything that happens in this business and vice versa.  When a person says they lost everything when they opened a business ….more than likely it was a sole proprietor who risked it all for the business.
There are lots of questions to answer in the beginning…I think that is why it is called the start up phase and not the start up day.  The good news is that most of this information gathering is useful now and in the future – especially since most of these questions need to be answered for the business plan.  The bad news is that it will take some time. 
There are some statistics out there that say 1 in 5 new businesses fail in the first year …and the numbers are worse for the first five years.  The (untold) is most of those businesses don’t follow the advice given, don’t know their business, and fail to do their research first.  If you get through the first stages and you still want to go into business for yourself…then you are well on your way to becoming a success story.

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