- Determine what type of business you are going to start.
For ideas, immerse yourself in web sites and publications dedicated to the small business owner. For example, Entrepreneur.com has an entire section on finding and buying franchises, as well as a Business Idea Center which lists 970 businesses you can start today.
Make sure your idea has the potential to be profitable. For money-making ideas that are current check out:
- Talk to small business owners in the industry.
Seek out several people who already own the type of business you want to start; make sure you talk to one or two people who have just started, as well a few who have built a successful business.
If you’re not sure where to find these business owners then start with an industry group, trade association, or online community devoted to that type of business – or start with the yellow pages. Invite an owner to breakfast or lunch; most owners want to help, and will be flattered that you asked.
When my business partner and I started our investment advisory firm we asked the founder of the largest private investment advisory firm in our city to lunch. After 30 years in the industry he was happy to share his thoughts with us, and we found his insight quite valuable.
- Read each step of Starting a Small Business 101.
Read Starting a Small Business 101, and go through each task step by step. This article covers all the practical things that have to happen, such as writing a business plan, setting up your business name, determining the right entity structure, finding the right location, and making sure you have the
One of the tasks you’ll find in the article will be the chore of laying out a business plan. For many, this is the hardest part – it’s a lot of work. If you can’t handle the work and mental gymnastics of laying out a business plan, than you’re probably not ready for the challenges that come along with owning and running a business. Below are several resources that can help with the business plan.
- Decide if you want to go solo or find a business partner.
The wrong partner can be a disaster. The right partnership will allow you to grow the business faster than either of you could have done on your own. A good partnership will also lighten the load of long work days.
If you goal is to build up equity in the business and sell it, then partners are going to play an important role. If your primary motivation is generating current income, along with the flexibility of running your own show, than you may prefer to stay solo.
The key to finding the right partners: making sure you share the same passion and long term vision, and finding people with skills that compliment your own. If you’re a numbers person, find someone who is good at sales and marketing. If you’re a visionary, find someone good with details like developing routine processes and systems.
- Rally a support team of people to provide constructive criticism.
Call old colleagues, family, and friends, and share your ideas. Ask for their help and constructive criticism. The best way to get people on your side is to ask for their opinion. We all have family or friends who are quick to point out the flaws in anything we do – in this case these people can become your biggest allies.
Listen to their criticism with an open mind. When you’re venturing into new territory it’s healthy to have someone bring up all the “what ifs”. Thinking through the worst case scenarios ahead of time will put you in a better position to handle obstacles.
- Gather a team of professionals.
You can’t know everything about everything. At some point you will need to find the right attorney, accountant, HR (human resources) consultant, payroll company, bookkeeper, IT (information technology/network/computer) consultant, website designer, and printer, just to name a few. These professionals will provide valuable advice and may even prove to be a source of referrals.
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