Have an idea for a product or service? You’re not alone. New business filings were up 25 percent in 2020 according to the U.S. Census Bureau. One reason is that the pandemic has increased the need for new ideas to help our work and personal lives. If you’re ready to start your own business, consider these tips for success.
Do Your Homework
Before you craft your business plan, you need to get your homework done! Taking the time to do market research can help limit risk and provide insight into what the customer really needs and wants. The U.S. Small Business Administration recommends these questions for a new business:
• Demand: Is there a real desire out there for your product or service?
• Market size: How many people are going to buy from you?
• Location: Where do your customers live and/or work?
• Market saturation: What does the competition look like?
• Pricing: How much will potential customers pay?
Plan for Success
A good business plan is like a roadmap that guides you along with the start-up phase and keeps you on track as you grow. It may also help your start-up prepare for unexpected bumps along the way. Your business plan should include a business description, market research, staffing needs, marketing plan, and financial projections.
The financial portion of your business plan should explain where your starting capital comes from and how the company will be funded. It should outline start-up expenses, projected sales, and long-term financial goals to help track spending and anticipate future needs. Be frugal. If you don’t need a physical location for your business, consider working from home or a shared workplace for you and your employees. If you need a physical space, plan well by consolidating work functions.
Protect Your Business
Business insurance is essential. There are different forms to consider such as a business owner’s policy, business property insurance, worker’s compensation, general liability, and more. Litigation, workplace injuries, or even a natural disaster can drain critical resources if you are not protected. Your homeowners’ insurance may limit or exclude coverage for the parts of your home and property used for business if you work from home, so take the time to look into what is best for your situation.
Seek a Mentor
Seek out a mentor with relevant knowledge and experience. Mentors can bring a fresh perspective and unbiased point of view – helping you navigate through unanticipated challenges. Mentors can also use their network to help find business partners, investors, or even new customers. If you can’t find a mentor, try classes, podcasts, and books.
We hope that these tips are helpful. Your new business idea might just be the next big thing. As Amazon.com Founder Jeff Bezos said, “I knew that if I failed, I wouldn’t regret that, but I knew the one thing I might regret is not trying.”