Starting a business can sound like a good idea, but not everyone is cut out to run their own business. These ten business startup questions will help you decide if you're ready to take the entrepreneurial plunge.
Recent U.S. Census reports state that an encouraging 76% of small businesses were still operating after the crucial first 5 years. The U.S. Small Business Administration, or SBA, defines small as businesses which employ less than 500 workers. More than 1 million new businesses are started in the U.S. every year, contributing to our nation’s economy. Anyone wishing to begin a small business should know there are many positive aspects for doing so, but there are also common, negative pitfalls. Taking stock of yourself, your skills, knowledge and resources is a crucial first step. The following 10 questions will help you decide if becoming a business owner is right for you:
1. Is your product or service unique?
Your business must provide a valuable product or service to potential customers. Doing some marketing research will help you determine whether or not you have something people will be willing to pay good money for. Conducting an informal survey through classified ads, online polls, flyers, etc. will help you decide.
2. Do you have adequate business experience?
Deciding if you have sufficient background experience with your chosen product or service is essential for the ongoing sustainability of your business. If you have no personally understanding of how your product or service works, how will you be able to sell it to anyone else?
3. Can you write a 3-year business plan?
If you don’t have experience writing a business plan, now is the time to learn how. A well-written, itemized business plan is the bones of your business. If you’re planning on applying for business loans, a business plan is a requirement. Research how to develop and write a business plan through the SBA, online informational sites, books and other educational outlets. If writing is not your forte, consider enlisting the aid of a talented friend or relative.
4. Can you take responsibility?
You cannot be a timid, wishy-washy business owner. You must be prepared to make important decisions and judgment calls, delegate responsibilities, hire and fire employees, be prepared to constantly sell yourself and your business, make cold calls and everything else that goes along with running company? Don’t despair if you feel you’re not assertive enough for what lies ahead. Consider taking assertiveness training or attending other confidence-building seminars.
5. Can you organize yourself and others?
Multi-tasking and making the most of your time is essential to any business owner. Before long you may find there are not enough hours in the day to accomplish all that is needed to operate your company effectively. Prioritizing tasks and responsibilities will keep you and your business on track. Keeping your employees focused is highly important as well. Try keeping written records of what you do, how long it takes and how well it worked.
6. Are you prepared to work long hours?
You will never again put in a typical 9-5, 8 hours a day when you become a business owner. You will be constantly looking for ways to build clientele, advertise, complete work, etc. If your primary reason for beginning a business is so you don’t have to work long, hard hours anymore you may as well give up right now. As a new business owner you will work harder than you ever have before. Consider how much attention and care your family will be forced to forgo without you, as this is a very important consideration.
7. Can you stick with it through the rough times?
Your business will undoubtedly experience ups and downs, lean times, malfunctions and potential disasters. Are you prepared to regroup if necessary? You must have the resilience to survive the rough times or your business will not succeed.
8. Is your family supportive?
Will your family be understanding when you have to miss special engagements? Will they be willing to pitch in when needed? Talking this over with your family prior to taking the entrepreneurial plunge will head off any family misunderstandings. Having a supportive, understanding family will be critical to your business success.
9. How are your financial resources and credit?
Taking a critical look at your financial resources is extremely important. Not only do you need start-up capital, but you will need a source of income to keep you and your family afloat while your business gains momentum. Additionally, you need to take an honest look at your credit history. If you need a business or other type of loan will you be approved? Finally, will you be offering your customers a credit option? Studies show that accepting credit cards or financing encourages consumers to purchase more readily. But in order to accept credit cards you must have an acceptable credit rating yourself.
10. Are you healthy enough?
Working long, difficult and often stressful hours can wreak havoc on your health. If your health is already compromised by existing illness starting a business may not be feasible. If your family is depending on you, incurring further health problems could potentially devastate you, your family and your new business.