How to Start a Business: 7 Tips

Many books have been written about starting a business, but here are 7 quick tips to point you in the right direction.

1. Choose something you are passionate about! This post is prompted by a question I received from a reader about how to get started with an agribusiness. My first question is: Why that business? Is it a passion or is the choice driven by logic and profit incentive only?  I do realize that some people might be passionate enough about profits alone to drive them to success, but for many others, that’s not how it works.  What are you passionate about? Are you familiar with the business through working in it already for another company? Why do you feel as though you’re passionate about it?

The passion will sustain you through the hard times, and there will be hard times.

2. Do you have the proper financial resources to get started? In some cases, such as an internet business, you won’t need much money and you can get started while still working another job. In other cases, such as an agribusiness, you likely will need significant capital to launch properly.  What is your plan to get that capital? Have you prepared a budget? Have you talked with others in your field to make sure you’re accounting for all the costs? I would strongly suggest taking the figure you come up with and adding on at least another 30 percent, preferably 50 percent, to make sure your budget accounts for unanticipated costs.

3. Do you have a marketing plan? Will you be marketing locally, regionally, or globally? How will you reach your audience? Who is your audience? Do you know your demographic because it’s an industry you’re already familiar with or do you need to do market research and surveys? Do you know what prices to set? What is your advertising budget?

4. Do you have sufficient funds to continue to support yourself and your family while your business develops and becomes profitable? How much time have you allotted for the development stage? Again, I suggest adding on another 30 to 50 percent to make sure you have planned sufficiently for your ramp-up time.

5. Have you accounted for all the areas of expertise and knowledge you’ll need to succeed? For example, do you have the accounting skills to keep up your books properly? Do you have the necessary marketing skills? The science skills in the case of the agribusiness example? If you don’t have the necessary skills, do you have access to the right people who can help you, and at a cost you can afford?

6. Do you have the support of your family? Have you considered how starting the business might affect your family, both positively and negatively? If your family isn’t supportive, are you emotionally prepared for the obstacles you might face because of it?

7. Have you considered what your life will look like once your business is a success? By this I mean not only visualizing yourself as a success, but also whether you will enjoy running the mature version of the company someday.  Do you like the idea of starting the business and excitement of creating something new, or do you like the idea of running the company once you have it established? Ideally, you will like both stages of the process, but if not, you should be thinking of your exit strategy from the beginning.

As I mentioned, many books have been written on starting and planning a business. A good place to get started is here:

Business Planning Books

Are you thinking of starting a new business? What steps are you taking to help make it a success?

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