Got a business idea - What next?
Different people start their own business for differing reasons, not all aim to become multi-millionaires – some seek a better lifestyle through more flexible working, some want to help society by providing a unique product or service that improves other’s way lives. Differing people have different motivations, ideologies and aims, but you as a business owner must always have one common goal – profit.If you believe that your new business is to supply a product that allows elderly people to open cans easily, yet they cost you £5.95 and you can only sell them for £4.45, you won’t be helping anyone after you declare bankruptcy. Even if your business motivation is ideologically driven, you still must make a profit to be able to help those not just now but in the future as well.
Is your business viable?
Start with a business plan, who will buy your product or service, how will they buy it, can they buy it already, if so, why will they buy it from you, if not, is this product or service not available because no one will pay the price that it costs – i.e. there is no market for the product.When doing a business plan you’ll frequently think to yourself that you simply do not know the answer to some questions but the point is that it gets you thinking about things that could happen - what if scenarios. If you find that it is difficult to write a plan, that is when you will be getting the greatest benefit from it – you’ll be searching for answers to questions that you have not asked yourself before.
Forecasting sales is never easy nor accurate, yet it is an essential procedure that has to be undertaken. If you don’t even supply your best guess, how can you ever work out if your business will be viable? To gain a better forecast for this it may be worth you undertaking some market research. Depending on what industry you want to set up in will affect the cost and complexity of this. Most start-ups can get sufficient information from questionnaires and informal chats with current competitors! It’s surprising what information other small businesses will share with you, they can always say no but if you don’t ask you don’t get.