If you’ve ever wanted to start a business or make extra money on the side, there are some key considerations and tasks that increase your chances of success. Get wise tips about managing risk, incorporating, business banking, starting no-money ventures, and how to prepare financially before starting a business.
5 Critical Things To Do Before Starting a Business
- Brush up on the fundamentals.
- Save more money.
- Test your idea.
- Learn the legal and compliance aspects.
- Consider your family.
I’m a firm believer that not much is required to start your own business. You really just need to get out there and start making sales. A business just needs customers. You can even start a business with no money.
But there are a few things you should consider doing before you start your own business. Let’s look at a few.
1. Brush up on the fundamentals.
If you’re planning to start a service business, it’s probably a good idea to brush up on the fundamentals of your craft. For instance, if you’re planning on starting a t-shirt design company, it would be helpful to take a course on Photoshop or other design software.
Not only will this help you improve your basic skills, but it may even lead to a few business contacts and potentially a few gigs. In addition to looking for classes, you could also consider volunteering or interning for a company that already does the work that will be required in your business.
2. Save more money.
Gary Christensen, who started a delivery service, says that, “if you’re not sure what you want to do, start saving some money.”
In addition to saving money, I’d recommend having your personal finance details in order before starting a business. The leaner you are on the personal side, the more freedom you’ll have to explore your business idea. The longer you can stick with your business, the greater your chances of success.
3. Test your idea.
Before you hire a single person, purchase a bunch of inventory, or spend a ton on advertising, you should test out your idea to make sure it’s a winner. Steven Sashen, who started a shoe business, made his “barefoot running” shoes for just a few people before deciding it was a legitimate business idea.
Not only did Steven’s first few shoes prove he could sell more, it led to some free advertising. Put a small piece of your business out there and let your potential customers tell you if it’s wanted.
4. Learn the legal and compliance aspects.
Depending on the type of business you are planning to start (e.g. food service), you may need to check with state and federal business regulations to understand how to meet compliance. Before the idea of a high-priced lawyer scares you away from doing business, consider the strategy used by Cara Bergeson, who started a custom t-shirt company.
Just because you don’t have the specific idea, it doesn’t mean you can’t start saving money for a potential business.
Cara says, “The Oregon Bar Association offers free to very little cost consultations for new business owners, so I spent $25, spent an hour with a lawyer on the phone giving me advice and stuff, and then I just took it from there…”
5. Consider your family.
Finally, think about how this new venture is going to affect your family. I asked a friend who recently started a real estate business on the side and he said this should be one of your biggest concerns before you get started.
Not only will you be spending money on this new project, you’ll be spending all your extra time to get it off the ground. This means potential time away from family. If you already have a full-time job and you’re considering a business of your own, you’ll certainly have to skip out on some family time.