If you are looking to start a business and become an entrepreneur yourself, you’re in the right place. In this article, we are going to touch on where to start, how to start, and how to keep it going. These are the key questions for the starting entrepreneur. You are never wrong to ask questions and get feedback on how to become the best at the business game.
Starting a Business (Thought Stage, 1st Stage)
- To start a business you first need to think about your passions, yes I know it seems weird, and you might be thinking, “what do my passions have to do with business”, but let me tell you it is a lot easier to build and grow a business if you are passionate about what you are doing. It will also help you not burn out and quit after working all those incredibly tricky hours.
- Second, once you have decided what you are passionate about (hopefully you found a few different things) start to think about how each one would work in a business setting, for example, if you love woodworking you could sell it online on Etsy or other craft websites, or you may create custom woodworking for contractors.
- Third, you need to decide which passions will fit the profile of a business. If the business profile you choose is overly saturated in your area, you will have to find a creative way to set yourself apart whether that be offering a marketing alternative to a small business or offering lower rates.
- Finally, what you need to think about before moving further is what exactly you want out of this business, maybe it is to make it a passive income source and create an exit strategy (which we will cover further later). You may want it for a part-time hobby for supplemental income, either way, you need to decide how big or small you would like it to be eventually.
Beginning the Business (Starting Stage, 2nd Stage)
Once you’ve decided what will work you will need to determine then what category as for your tax identity and legal liability as each different corporate level has separate legal obligation, and each has different taxation rules as you can see below, so I would meet with a tax and a licensed professional before making your final decision.
Once you have the company established you need to decide where your office is going to be set maybe it’s in your house or at an office location that you rent to start or if you have the capital you could buy a place. There are various things that you need to think of before purchasing.
- Location- This is one of the most important things that you need to find in a building because you need to make sure that it is visible and that it looks appealing to customers. It must be visible and convenient so that customers can see your business and it must be convenient because if they must go entirely out of their way to get to you then they more than likely won’t so think to yourself would I come here if I didn’t have to. The building also needs to look appealing to your customers because if it doesn’t, you could lose business depending on what type of business you own.
- Amenities- Each location has its facilities, and you must find the ones that are a good fit for you. There are separate amenities for you building your own office or warehouse. To start, we’ll begin with creating your own warehouse/office one thing is it needs to be able to be on land with enough space to renovate and expand while also providing parking for employees and customers providing both with an added benefit of doing business with you as they won’t have to pay for parking! If you buy land, it also needs to be zoned appropriately. Do this, so you don’t run into problems with zoning permits. Some people may laugh and think “I’m not dumb I know I need to make sure its zoned correctly,” but there are people out there that mess it up when they run into a ton of trouble with zoning boards, also make sure all your building permits are up to date. If you are renting make sure that the space you are renting first has enough room and second has what you need such as storage, printer room, break room, office space(s) and also possibly a conference room to be able to contact your clients and set up conference calls to establish plans for the future or other various meetings. The last thing I would look for in amenities/location is how close in proximity is it to major shopping centers or restaurants which could generate not only foot traffic but vehicle traffic. Increases vehicle traffic brings your building possibly bringing in more customers not to mention being close to restaurants is a perk for your employees so they can run there on their break.
- The last thing is the most important one as it is two questions you should always ask yourself before choosing to buy or lease a location. The first one is how long will this building, and location be able to last me as an office because if your business is going to grow is it going to outgrow the office in a year maybe five or is the location coming with enough area that it will be able to accommodate the rapid expansion of your company? The second question you need to ask yourself is will I be happy in this location for possibly years to come or am I going to want to move in a few years this is not as much of a concern if you are adding another office location. These are two critical questions because they bring about thoughts that not many entrepreneurs think about before building and or leasing a property, so they make it too small or rent too small of office for their company and then they’re stuck with it for the duration of the lease or real estate sale.
You could also choose to have an online business. These can take form in various forms on various websites such as; Shopify, WooCommerce, Volusion, and Squarespace. We will talk about online-based companies later, so you’ll have to stay tuned for that.
Maintaining your Business (Maintenance Phase, 3rd Phase)
Having a business is hard work because you must continuously still put in much work and it is continuous throughout the life of the company. You can take away some of your responsibilities by hiring a good team around you that will be able to help grow and expand your business into an empire. There are two ways to gain help they go as follows:
- You could hire employees they can help take over everyday responsibilities such as customer service representatives, secretary work, cleaning, maintenance, and packaging and processing orders. Employees for small businesses usually do day-to-day operations.
- The second type of help is advanced skill help employees can cover some, but in a small business standpoint, they need outside agencies such as contractors, electricians, plumbers, and more than likely an advertising/marketing firm to cover certain jobs. These agencies work because hiring full-time employees in these positions are too expensive and most of the time agencies can do it for cheaper, or there are certain types of incentives such as tax deductions, pay per job, or as said before the small business can’t afford the full-time position as an employee. They can also be useful because they can take a headache away from small business owners because the outside agencies/contractors do all the thinking about a problem then they propose the fix or idea to the small business owner/manager.
- Maintaining a business also means knowing your financials and being able to see when the right time to take steps to expand are and when to downsize. These are all situational things, but if you don’t feel comfortable with it, you could always hire a financial advisor, find investors, or even take a risk (I do not suggest taking a blind risk so educate yourself and put a right amount of thought into it). These are all excellent ideas to be able to have guidance due to the investors giving continued leadership because they want maximum returns and financial advisors usually get paid for their services, and if their advice helps you, it is more likely you will return to them making them even more money. Financial capital can accrue in a lot of different ways, but we will discuss this later as it can make this already quite a lengthy article even more prolonged.
Creating an Exit Strategy (Exit Phase, 4th Phase)
An exit strategy is for people who do not want to make their job and existence in the company permanent and want to move on to more significant ventures in life or want to leave the problematic entrepreneur life behind. There are many ways to exit your business, but I will outline four for you to think about when you reach this step or if you are already here these are for you!
- You could sell off the business! Selling a business is a popular choice among entrepreneurs as it gets them the life of complete freedom from the industry and its possible liabilities. Selling can happen by approaching holding companies, investors looking to buy a company and have someone else run it, or by selling it possibly to friends or family.
- Second, you could hire an agency or an employee to run the business for you so you can still reap the rewards of the profits and claiming ownership of the company, but this allows more of your time to be spent with friends and family instead of at the business. The downside to this is when the manager needs help or something is going on with your company the manager or the agency managing your business will more than likely contact you interrupting vacations, family time, or really just anything you are doing as it will more than likely involve you going to the business to help dissolve such problems.
- You could close the business as an easy way out it ends the trouble and stress but also ends the flow of money. Closing is not a good idea most businesses that have even just a little bit of established reputation are worth something to someone you only need to find the right buyer.
- Lastly, you could take on a friend to co-own the business with you so that way you guys can split the cash flow and help take over partial responsibilities of the company. I know this isn’t an exit strategy, but it is better than absolutely nothing.
I hope after reading this article you are either thinking about starting a business, growing your business, or developing an exit strategy. I would like every one of you to sit down and think about whether this the life that I want or would starting a business get you where you want to be.
Invested: How Warren Buffet and Charlie Munger Taught Me to Master My Mind, My Emotions, and My Money, a book by Danielle Town and Phil Town, introduces people who have never invested a day in their life to fund and gain financial freedom by following a simple 12-month strategy plan to achieve that goal! It is a story about how Danielle Town went from not knowing anything about investing in gaining financial freedom. This post is a new type of article for Hopeless Entrepreneur, but we’re going to do it. The position is a blog review and an introduction to a challenge we will be doing starting this month. The problem will be headed up by our very own Owner and CEO Tanner Payne.
“The Maryland Entrepreneur’s Guide/Choice of Entity.” Development Cooperation Handbook/Guidelines/How to Manage Programmes for a Learning Organization That Is Projectized and Employee Empowering – Wikibooks, Open Books for an Open World, Wikimedia Foundation, Inc., 9 Sept. 2016, en.wikibooks.org/wiki/The_Maryland_Entrepreneur%27s_Guide/Choice_of_Entity.