As I write this, the World is still very much in the middle of a global pandemic. This has created a huge amount of uncertainty for many business owners and employees alike, with ‘the new normal’ making the continuation of some businesses much more challenging and rendering other businesses completely unviable. From retail stores to restaurants, from travel to training – there is almost no business sector that has escaped unscathed from this.
But with great change also comes opportunity. The products and services that are in demand has shifted, and so has customers expectations and demands. This, along with ongoing job uncertainty, may lead many to actually start a new business venture and seek out a new path for themselves.
So if you are a new entrepreneur at this time and you have just started a business or you are looking to get started, here are some tips and points to think about to set you off on the right path.
1. Follow your passion
It is going to be hard to build a business if you are not passionate about what you are doing. Being a business owner means you are probably going to have some difficult times and will be spending a great deal of time thinking about your business. If you aren’t deeply invested in what you are doing then this is going to be pretty tough going.
This is a double-edged sword however. Turning a hobby or a passion into a business may change your perspective on it and there are plenty of examples out there of people who have come to realise this. What you once enjoyed recreationally is now your profession, and you may find at the end of the busy or difficult day, that you start to resent it a little bit. Make sure that you are prepared for this and are willing to accept this.
2. Do your research
In the current climate, you may well be keen to take action and get started as soon as possible to get first mover advantage, or to fill a gap before anyone else does. That is all well and good and you should certainly act as soon as you can if you feel that you will otherwise miss an opportunity – but don’t let that get in the way of doing your research and doing it properly.
Who will your customers be?
How will you reach them and market to them?
Where will you get your supplies from?
What should your price point be in order to strike the balance between acquiring customers and making the necessary amount of profit?
Will you be selling your product online, in person or both?
How will you accept payments?
How will you adhere to current Covid rules including safe working and social distancing?
What insurance or permits may you require?
There are potentially dozens more questions that you will need to ask yourself and comprehensively research the answers (see this article for some more examples). If possible, seek out someone who has previously started or run a business in a similar niche and lean on them for advice and support. This may be in-person but could equally be someone you can connect with online.
3. Get your finances in order
You need to be certain you are financially able to do this. If you are leaving employment to pursue this new venture, then you should probably have money saved up to tide you over in the first few months as you start to get customers and build your revenue streams.
Likewise, you should probably try and clear any debts before you get started, as you may run into big problems with your credit score, if your reduced income means you start missing credit payments.
Equally, you need to be able to meet any cash flow demands of the business. For instance, you may need to spend £1,000 on supplies in order to manufacture or deliver your product. Once delivered, that product may well make you £3,000 and things will be looking rosy– but you need have that money to invest in the first instance.
Business loans or other emergency short term loans are available which may help you get past this hurdle, but you may find that without regular income from employment and little to no business history, getting accepted for one of these may be a challenge.
4. Keep it simple
The biggest and most immediate challenge for any new business is to get the first few customers and get revenue flowing in. So you should perhaps ask yourself, ‘What is the bare minimum I need to get those customers?’
It may be that flashy business cards and an all-singing, all-dancing website can wait. No doubt these will help and you should absolutely look to present your business in the best light, but unless they are critical to achieving your first sales, they may be better placed on the back burner until your business is off the ground.
You may also have grand ideas of numerous different products or services you can provide, but in the short term it may be better to choose one or two of these and deliver them exceptionally well, rather than trying to deliver ten different things and providing a mediocre product or service.
Make sure in the first instance that you are keeping your promise to customers and exceeding their expectations. Once these foundations are in place you can look to grow and expand.
5. Prepare for the worst
You almost certainly know that stats – around 60% of new businesses fail in the first three years. Of course you think and hope that your business will be in the 40% – but it is prudent to have a contingency plan and prepare for the worst. It isn’t negative thinking, it is being responsible. You really don’t want to have to deal with declaring yourself bankrupt.
It may be that you would need to get a temporary or part-time job, or it may be that you need to move back in with your parents, or even ask them for a temporary loan to bail you out. Thinking through this eventuality up-front will ensure that if the worst comes to the worst then you are prepared.
If you find that you don’t have sufficient safety nets should your business not work out, then you should potentially reconsider if now is the right time for you to launch it. It may be better to delay it until a later date when you have cash saved up to tide you over in the eventuality of the business going under.
Hopefully this has given you some food for thought. If you’ve read through this and are still confident of launching your business and succeeding, then best of luck – I’m sure you’ll flourish!