A question came up in a discussion group to which I belong. The question was, How to start a new business? What are do’s and do not’s; which are emerging trends and markets; where will future lie; and what about sustainable demand? My response:
First and foremost: DO what you love and love what you do. If this component is absent, you will not be successful.
DO have a **comprehensive** business plan – think of it like going on a long trip with a roadmap. DO your research. DON’T just be lazy and use the “plan-in-a-can.” DO have a vision of what you want your company to be, and how it should look in 2 years, 5 years, and 10 years.
DO have adequate startup funding – nothing can ruin a business faster than cash flow issues at the beginning.
DO have an emergency loan repayment plan if you use commercial financing (how will you repay loans if your sales drop?). DON’T rely on bankruptcy.
DO keep your business and personal finances separate – as if I even have to say it, but there it is anyway.
DO regularly consult with your team of advisors – CPA, Attorney, Financial Advisor. You don’t have a team? Get one and fast. Surprisingly, this team will save you money in the long run, far outweighing the cost, and attorneys can be had for very little money for basic business needs.
DO learn how to read your financial statements and use them as a tool to make good business decisions, because that is what they are for (your CPA on your team should help here, and if they don’t, get one who will).
DO register your business properly and keep up with renewals; DO file your tax reports on time; DO **pay** your taxes on time – even if it means setting aside funds in a physically separate account or paying as you go.
DO have a website and make it easy for your customers to a) get information about your company, your employees (in general, not details), and your products and services; b) buy from you (with good descriptions of products or services, including pictures if necessary, and adequate pricing if appropriate); and c) contact you by phone, fax or email when they have a comment, complaint, or congratulation. DO regularly review the comments and use them to adjust your customer service (because if your customers needs aren’t met, based on the comments they provide, they will shop somewhere else – it’s too easy for them to change. DON’T forget to keep the website updated.
DO rely on finding ways to increase sales in good times, and you may not have to be cutting costs in difficult times. You don’t want to get on that roller-coaster, it’s unproductive, and not sustainable.
DO cultivate your network of customers/clients, colleagues, family, and friends and DO get in the habit of asking for referrals – if you don’t ask, you don’t get. DO get in the habit of helping your network by giving referrals as often as possible.
DO have an exit strategy – as important as everything else. This will include your personal retirement plan (DON’T rely on having to sell the business – if you’re thinking this is the only way, contact me or post here and I’ll tell you why it’s not a good idea at all); estate planning, planning for your children (if you have them), and your spouse (and/or former spouse(s) as well); temporary or permanent disability of self or partners; and untimely death.
Emerging trends & markets I’ll leave to the experts in those analysis fields…
Where the future will lie: I believe it is in exceptional customer service (a very good thing), and in continued instant gratification (maybe not such a good thing). Everyone wants everything right now with no problems, and it is up to the business owners to give it to the customers or risk losing them. As I stated earlier, it is too easy for customers to go elsewhere. Try not to give them the option or the excuse.
Sustainable demand? Who knows with everything changing so quickly in so many areas. But I think customer service will beat all, every time. That will keep your customers coming back and telling everyone they know about you.
Stew on this awhile…