First you
should have a business plan. You do not want to go off half cocked and try
to make a business successful flying by the seat of your pants. There is a
saying that, Businesses don’t plan to fail, they fail to Plan. So take
the time to sit down and try to think of every conceivable permutation of
your business and what you would like to do and what you need to do in
order to succeed. Also consider what could go wrong and try to come up
with a plan for every scenario.
Your business plan
should include at a minimum.
Picking the right
name for your business.
This sounds foolish
but think about it. If I am selling custom embroidery, which we are, I do
not want to call my business, Bob’s Enterprises. It says nothing of what
my company is about and it implies that I could be doing a multitude of
things instead of concentrating on custom embroidery. We already had the
name, Tamicraft, that we did business under, so we just added Embroidery.
Tamicraft Embroidery. It says it all, pretty much. Name recognition is
very important and a name that incorporates what it is you do is even more
important in getting those customers that do not recognize your name.
Remember to get that business license. You don’t want the State or the
IRS on your back.
Location.
Well as we are
concentrating on a Home Based Business, location is not much of an option.
But if you plan on leasing space search for the right location for
whatever your business is. Example: If I were to start a pizza place, I
would try to find a place close to a college, as we all know college
students live on pizza. I would also look for a place that did not already
have an overwhelming amount of competition. I would also want it to be
highly visible from a main shopping center or highway. Or very close to a
major residential area of middle class homes. You need to decide what your
business needs are.
The cost of starting
your business.
What inventory, cost
of goods, supplies, machines, employees, utilities, space and/or equipment
rental, extra phone lines or 800 #’s, advertising, accounting,
bookkeeping, and other direct costs as well as indirect costs like gas,
wear and tear on your vehicle, professional clothing, perhaps even daycare
for your kid. Every cost you even think you might encounter should be
accounted for. When figuring your costs don’t forget to include any
carrying costs for loans, goods, outside help if needed and make sure you
have enough money to see you through several months if you are going to
make this a full time commitment and quit your day job.
How are you going to
market your business?
There are many ways
to market your business from TV commercials to flyers placed on cars in a
parking lot. Some will be of great expense and some will be virtually
free, like online free classifieds. But you have to get the word out about
your business or you will have no customers. Unless you already have a
market for your goods or whatever you are selling you really need to
budget for a marketing campaign. Even if that campaign is merely flyers,
free ad space or a sign. The more you get your company exposure the more
likely you will get the business you need to be successful. In our
embroidery business most of our marketing will be door to door hawking our
goods and services to local merchants. But we will also have a sign on a
major state highway that my property fronts on as well as flyers posted on
bulletin boards wherever we find them. Also signs on all our friends and
families properties throughout the area. I expect that word of mouth will be
an integral part of our marketing as well, and the wife knows a LOT of
people. She has already gotten commitments from several to take a look at
her work. Banks, Veterinarians, Dentists, a Lumberyard and Hardware
Store and she is at least a month or more away from being ready. (spring
2008)
Update: Be prepared to put your money
where your mouth is.
Before My wife had even made her first
for profit item she had literally dozens of places and people interested
in what she had to offer. From friends to people she knew through the kids
school and other functions to places we do business with. If she would
have pounded the pavement she would have had dozens more. Her business
would have turned a profit from day one. However she let personal desire
preempt her business. She began to get heavily involved with other people
doing quilting and then when her mother started having health problems and
our daughter started having more doctors appointments she totally left the
embroidery business idea by the way side. She felt she didn't have time to
do the things she enjoyed like quilting and keep up with all the Dr's
appointments as well as run a business. So she never did more than talk
about it.
A shame really as the word had already
gotten out and she was already overwhelmed with people wanting to see what
she had to offer. The person that sold us some of the equipment who had an
established business she had to give up because of health issues was even
trying to get the wife to take on some of her old clients. The wife just
never intended for the business to be full time and as she saw it creeping
in on her free time and on the things she needed to do she decided this
was not the right time for her to begin a business no matter how
successful it may have been. She had other commitments as well as her free
time and her other crafts.
Perhaps she could not have done it full
time but that was never her intention. She could easily have done it part
time if she had not gotten involved with her quilting friends. She just
did not want to put in the effort nor do more than talk of having a
business and so here I have to say, if you are going to start a small
business whether it be part or full time you actually need to set aside
the time and work at building your business. If you treat it as a hobby it
will always be a hobby. You have to think of it as a business and treat it
as such and make the commitment to follow through. There will always be
something you need to work around like Dr's appointments and such but if
your mind is in the right place you will be able to work round any
obstacles and still stay on track to make a really concerted effort of
growing your business. Some people just do not have that drive and those
should probably never even consider opening their own business.
Do the research.
By this I mean look
into the business you want to create and see what the competition is.
Where it is and how much it is. What are the price points of that
competition and can you compete. What are the costs of the goods to you,
the quality of those goods, and can you turn them for a profit? How much
of a profit do you need to make in order to pay expenses and debt and
still have a nice return to you? Can you go several months without an
income? If your business is unique and there are no comps then do some
market research to see if your business is even viable. If you are going
to do MLM like Mary Kay or Amway then find if you can get a large enough
customer base from friends and family to keep you going while you continue
to look for other opportunities. It may be that
there is no market for your business. Find your suppliers and find what
availability there is in product. What is the lead time to get that
product and do you have options should your primary supplier fail? If you
are going into some sort of manufacturing, like our embroidery business,
do you have a backup in case a machine breaks down. You want your
contracted deliveries to be on time, even if that means you have to
outsource the work or rent machinery.
Take the time to get
it right.
Don’t get an idea
and a couple days later just go out and do it. Take the time to make sure
you have made your plan. Take the time to do your research. Take the time
to look at your business from every angle and be as sure as you can be
that you have covered all the bases. There is nothing worse than getting
up and running only to find you missed a very important item and having to
scramble to CYA. Make sure you know every single element of your business
before you even think of opening the doors. Sure there will be
unforeseeable things that will arise but if you take the time to prepare
you will be better prepared to face those intangibles when they rear their
ugly heads.
Keep in mind it takes
time to start a business from scratch. Don’t rush it. What do they say?
Only fools rush in. Well that applies double to a business cause your
money is on the line. If your lucky enough not to have to worry about
money, you still want your business to succeed, don’t you? Well if you
do, make sure you’ve done your homework.
If money is an issue you might want to test the waters part time at
first. You might want to look at a business that has little to no setup
costs, or one that has very minimal out of pocket expenses to keep. I’ve
found one I’m confident in, and I know there are others. Well, like say
Drop Shippers is one to look into, as you do not purchase product till you
get the order and the money. Be careful to look a drop shipper over very
closely and get on the forums and find what information you can, cause you
do not want to deal with one who can’t hold up their end. You come off
as the bad guy and your business is the one that will suffer for their
mistakes. And if you are wondering, No I am not affiliated with or doing
business with any drop shippers. I only give it as an example.
One last thing.
I don’t know if
this Article site I’ve posted this to will allow an internal link or
not, but I would check out the United States Small Business
Administration’s web site. http://www.sba.gov/
They have a small
business planner and setup page that could be of extreme benefit to you
depending on the type of business you are about to engage in. It would be
wise to have a look before you move forward with your business plans.
I hope this has
helped some of you.
Thanks
Robert Taormina
http://vintageslips4u.com
http://cpfsn.org
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My daughter has Cerebral Palsy. I do
not say this for sympathy. I have created a site devoted to helping
people with disabilities find resources they need to navigate DSHS,
DDD, SSI and others including the school system. What I need from you
is to let people with disabilities know of the site and get them to
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I am spending what time and
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Please check out the site and if you
can contribute with any information please do so. Check out the site I
made for families with children who have CP Click http://www.cpfsn.org
Through having to take our daughter to therapy and
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and upon hearing of the same troubles others have had doing the same we
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