I guess there is such a thing as falling into a business, after all, people do fall into jobs. It does get a little more complicated when it is a business. If one wants the business to succeed there are steps that need to be taken and work to be done.
First of all, one has to have knowledge of the product or service they are proposing. It is difficult to market to your customers if they do not have the confidence that you know what you are doing! You also must do your due diligence and research your target market and ensure there are enough potential customers or clients in your market area.
Once you have an idea of the number of potential clients, you need to determine how many competitors there are. This will establish your market share. Your research into your potential customers or clients should tell you why they buy the product, how often they buy the product, where they get it now, and why they might change and come to you.
Knowing the regulations pertaining to the proposed business is essential as you need to ensure that you can do your business legally whether you are home-based, have a store-front, or are manufacturing. Regulations for some businesses might also be health and environment.
What are your start-up costs? What are the costs to open the door? You may have licensing, permits, renovation costs, supplies. How much money will I need for the business? The three things to consider are; what is needed to start the business, what is required each month to maintain the business, and what do I personally need each month from the business? Do you need financing, if so where is the money coming from? Most businesses do not break even for some months so you should not count on taking owner draws on the business for the first few months, sometimes longer.
Producing a monthly cash flow worksheet for the business will keep you on track and show where you need to concentrate your efforts. It will show your projected sales and expenses for a year and I guarantee it will not turn out as projected. It is a living document that will keep you on track and can be altered. This is extremely important as you can be asset rich, but if you have no cash flow, you will not be in business for long.
Falling into business is not easy, or wise. You need careful planning and research to be successful. There is lots of help out there for you at your local Community Futures Office and good resources online. Do it right and have fun! Done right it can be very rewarding!
As always, feel free to share this post giving credit to the author.