If you are reading this, it is because you have the desire to start your own business. For several decades, entrepreneurship has been presented as a viable option for those who have a good idea or for those who do not want to live working for someone all their lives. However, starting a business without being prepared can be a nightmare, so today we are going to answer the question of What do I need to know before starting my own business?
If you are convinced that your path is entrepreneurship, but you have many doubts and do not know where to start. Today we present 5 things you need to know before starting your business.
1. Who is your competition
One of the things you have to know before starting any business is who your competition is, but it is not enough just to know the name of the companies, you have to find out everything about them, know them better than yourself. What is their strategy, what are their value propositions, what is their target audience, what are their strengths and above all what are their weaknesses.
This will give you an overview of what are the areas of opportunity, what can be your sales strategy, which customers you can focus on and will also give you the basis for you to create your value proposition.
The task of knowing your competition will help you to start knowing the market in which you are going to develop. So attend as many events, fairs, forums and exhibitions as you can, because the more knowledge you have of the market you will be able to identify the current needs and you will be able to offer a better focused service, which will lead your venture to success in the shortest possible time.
2. What need are you going to cover
Surely you already have a more or less clear idea of the service or product you want to offer, but if you want to have customers, then you must ensure that there is a demand for what you are offering.
You can guarantee that there is a demand for your product if you can answer the question: what is the need that my product or service is solving? The answer to this question will not only tell you if it is a good product to sell or not, but if you dig deeper, it can give you more data.
Let me give you an example, if you want to engage in the sale of food, you know that there is a need that will satisfy the need for food. But imagine that you are interested in establishing yourself near a university because you know that there is high traffic of people, the need of your future customers will probably be fast and cheap food, that is, your customers will probably be students who do not have the time or money that has, for example, a family on a weekend. So you can sell food like hamburgers, hotdogs or tacos, but if you offer signature food you will most likely not find demand for your product.
On the contrary, if you decide to place your business near an office area, the needs of your customers besides eating will be to have a comfortable place, so you can place a restaurant where the experience and comfort play a role as important as the food.
If you analyze the previous examples there are specific needs that you have to take into account to offer a service that has guaranteed demand, ask yourself what these needs are before starting your project can make your project have better results.
3. Who is your target audience
The most successful businesses are the ones that are customer-centric. Surely you have already heard of this, however starting a customer-centric business is not so easy if you do not know who your customer is.
Knowing your target audience or ideal customer is one of the first tasks you should perform before starting your business. Defining an ideal customer will help you determine strategies and details of your business. Maybe you already have an idea of who this customer might be, but it is best to sit down and describe him or her completely.
Specialists recommend gathering as much information about your ideal customer as possible. If this is the first time you face this problem, you can use the following list of data so that you do not forget any of them, just remember to answer thinking about the customer you want to reach:
- Demographics, i.e. basic data such as:
- Age try to create a very specific age range, this will help you in the future to focus your advertising campaigns.
- Fundamental for your copywriting team to be able to target correctly.
- Location: include whether they live in urban, suburban or rural areas.
- Family status: here you will have to determine if he/she lives in a family or if he/she is single; if he/she is the head of the family or if he/she is a son or daughter.
- Education level, this information will help in content marketing.
- Professional status. Fundamental information for both B2B and B2C companies.
- Position and level
- Industry you work in
- This information has to do with the values, views and objectives that your ideal client has.
- Professional goals
- Personal goals
- Religious beliefs, for some brands, it is important to know if their clients are religious or not.
- In ideology, it is important to design more conservative or more liberal campaigns.
- Influencers and sources of information, this information can help you understand the communication channels you can use to reach your ideal customer.
- Preferred influencers or opinion leaders
- Both digital and traditional media
- Favorite events and conferences
- Purchase process
- How often do they repeatedly purchase your product or service?
- What prevents or motivates them to make the purchase
You can acquire this type of data by conducting a previous campaign with surveys or questionnaires. You can even start a campaign in Google Analytics to obtain statistical data about your future customers.
4. How much do you need to start your venture?
Talking about money is never easy, but if you want to get your business off to a good start, you have to sit down and do the math. The first thing to do is to make a budget. Calculate the costs of supplies, advertising, expenses such as taxes or permit fees, and don’t forget to include your staff’s salaries.
An important part of a budget is to identify what will be the fixed and variable expenses, this will help you to have an idea of the money you should have each month to pay the bills.
We know that a budget is not infallible, in fact it is more common than you think that the total expenses exceed the budget, especially if you have a high percentage of variable expenses.
Making a budget will help you to plan strategies that will help you place more expenses as fixed and decrease variable expenses, in this way you will have a closer idea of what you need each month.
Making a clear, predictable and real budget can be quite a complex task, fortunately nowadays you can access through the Internet to different guides to build a budget.
5. How are you going to finance your venture?
Once you have a budget, it is time to look for financing. This can be one of the most complicated stages, especially if you don’t know where to look. Today, you can have access to several sources of funding for your venture.
You can resort to traditional sources such as bank loans or financial institutions, although entrepreneurs are using these alternatives less and less, since there are several alternatives with a much lower interest rate and more accessible.
You can also approach incubators or accelerators, which are organizations specially designed to support entrepreneurs. In addition to finding financing, they will also help you with the organization and planning of your venture.
Another financing strategy that you can approach is crowdfunding, which consists of organizing financing campaigns so that people can make monetary donations in exchange for a small gift or a share in the shares of your company.
Deciding to start a business on your own is exciting, although there is always the fear of failure, you can rest assured that if you have asked yourself what you need to know before starting a business then you are on the right track, because you are taking the time to research and learn, so your venture will have more chances to succeed. Tell us, do you think there is something more you need to know before starting a business.