In the last few years, we have seen a huge increase in entrepreneurship. More and more of us are looking to start our own business, Millennials especially. The idea of being your own boss, working at your own discretion and of course, the most attractive benefit—keeping the profits—is all well and good, but how do you get there?
An idea is crucial, but this is where struggles lie. Here are some factors to consider, to narrow down your ideas and aid you in the decision-making-brainstorming process.
What are your interests and strengths?
It is likely that the type of business you would like to start is linked to the things you enjoy doing and are passionate about. For example, if you love to swim, then perhaps you would like to start a new business that offers swimming lessons which you teach. There is no point in starting a business based around something you struggle with or dislike—you need to be enthusiastic, motivated and determined to run, grow and manage the company, as most of the work will be on you!
Therefore, reflect and assess your strengths and interests; can you get any ideas from here?
‘Do what you love and the money will follow.’
What startup costs are you looking at? What is your financial position?
Funds to start a company have great impact on the type of business you want to create. If you have limited funds, online businesses which are cheaper, e.g., blogs, would be better suited. However, if you have the funds and sources of investment, the bigger you can go! For example, it would be more expensive to start up a boutique, as you would need to purchase the clothing as well as acquire a store and pay the overheads.
Often, when starting a business, it is preferred to start off small, where it is cheaper, as you do not know the success of the business. It is said that most businesses close after their first 3 years and so most entrepreneurs do not want to risk their capital, and ‘waste investment.’ If the company is sought to be sustainable and profitable, the company can expand and grow from investments and expansion capital.
A piece of advice is to take time to learn about the financial controls, so that you can manage cash flow and avoid insolvency.
Do you have the time commitments needed?
If you are looking to start your own business, ensure you have the time to do this. Will it be a side business? Or will it be a full-time venture?
My advice would be to start it as a side venture, as this way, you still can receive an income and be busy if the startup is slow to get off. When the business becomes more successful, then it would be time to quit your job and run your own company full time. Remember, it takes time for a new business to make money. Slow and steady wins the race!
Similarly, can you commit to the working hours needed? Does it fit in with your lifestyle? For families and parents to young children, a business which is open during the day and at weekends may not be suitable as they will have parental responsibilities to adhere to. Likewise, a young adult may not wish to start a business which demands working at night and evenings, e.g., starting a taxi business—is this suitable for the young adult party lifestyle?
When you have an idea of the field you would like to be in, learn as much as you can about it, to ensure this is where you really would like to fit.
Network with others in the field already and ask all of the questions: What is it really like in that particular industry? What are the start up costs? What is the competition like? How much time does it take up? What are the benefits and downfalls? Speak and get advice; no question is a silly question, they would have been the same when they had started. You need to ensure it is the right sector for you.
However, a pointer: do not abuse their openness, take their advice and then compete. Use the advice generously.
Interestingly, you may even gain ideas from networking—you may be inspired by someone from the industry, talking about an idea they believe has potential! Always keep your eyes and ears open!
What is already in the market?
It is vital to ensure that your business idea does not already exist. Doing some market research to see if your idea is demanded, or if people would be interested, is very useful. Similarly, research into what people want, yet currently have no access too, hence identifying gaps is beneficial. If you can offer a unique service which is demanded, then you have a good chance of survival, especially with little competition.
Also, assess what consumer habits are currently. For example, we are currently seeing a preference for online-retailing due to its convenience; would starting a new retail high street shop be a good idea? Or would it be better to open an e-commerce store? Get to know the trends and use them to your benefit!
What competition is there? Can you be similar but different? Do you intend on imitating?
Interestingly, it is also important to recognize the areas of the business environment which are struggling. Which sectors are not seeing any growth? Has there been any patterns of insolvency? For example, at the current moment, we are seeing many retail stores close.
All of the above factors are essential to consider. It takes time to start your own business, so you must commit and put in the effort to see if the type of business is right for you. So, get thinking…Make it happen and own the business you have always dreamed of.