Nadya Eka Lestari
TechInAfrica — Setting up a business from zero is no easy job. There is a higher chance of falling when a business is started without a correct preparation firsthand. But worry not, experts from Small Business Development Centers (SBDCs) exist to share their advice on building a business successfully. The company works with entrepreneurs, providing free and low-cost consulting. Annually, SBDCs support a new business launch every 31 minutes and provide more than 1.3 million hours of consulting services to entrepreneurs.
THE BASICS
Know the customer
Lee Lambert, director of the Alameda County SBDC in Oakland, California, advised, “to succeed as an entrepreneur, you must know your customers and what they want; it’s the key to success. Spend time doing some grassroots marketing, and go out to talk to your customers before you start the business, and continuously solicit their feedback after that,” he suggested. “Doing this will help you build stronger, longer-lasting customer relationships.”
Analyze the competition
“Many entrepreneurs think they don’t have any competitors and that is not the case,” Tamela Darnell, management consultant for the Kentucky Small Business Development Center stated. “You have direct and indirect competitors.” She said.
Find a niche
Some businesses start with their own unique niche, but there are also those who don’t have a clear vision of their niche yet. For the latter group, Enrique Romero, regional director of the University of Texas of the Permian Basin SBDC suggested, “you will eventually find your niche market by working through as many customers as possible, and find a certain customer base that will stick.”
Do the homework before launching
Robert Bahn, lead business consultant with the Arkansas Small Business and Technology Development Center said that he sometimes sees clients who think that they can launch a business as long as they have enough money to cover rent and opening costs.
He further recommended that it is crucial to conduct solid market research or gather information on business financing as it will help to prepare before the business is launched.
Beware of too many good ideas
At the beginning of starting a business, people tend to spread themselves too thin and it could be overwhelming. Marelena Sandy, program manager for the Illinois SBDC at College of DuPage said, “trying to make all of your business ideas effectively work at one time is simply not attainable.”
She recommended businesses to use a feasibility checklist to figure out which one works best for them. “What’s the market like? Your competitors? Do you have experience?” These are just some of the questions you need to ask. “Make one idea successfully work, and then decide whether you want to take on another venture,” she suggested.
THE FUNDING
Start with as clean a financial slate as possible
“Begin to get your ducks in a row,” Romero said. He also added that a clean financial slate would include reviewing and working on credit, “saving money and [getting] up-to-date on your finances, including your taxes. Why? Because as a new business owner it will be a tough road ahead and you don’t need a lot of baggage holding you back.”
Acquiring enough funds to cover expenses until a breakeven is reached is important. Make a smart decision to protect finances and business credit.
Know when to get a breakeven
Projecting the path to profitability is fundamental. “Most business owners want to make money, but you need to know when you expect to break even,” he says. “This way when you do not meet the timeline, you have to make some big decisions, one of which is to shut down,” Bahn warned.
Sandy also urged to make a list of startup and operational costs, keep track of what you are spending, organize your contacts, and by all means keep them up-to-date.
SEEK HELP
Ultimately, good business owners should know when to get help and don’t keep on doing everything themselves. “You will have a tremendous amount of responsibilities” Sandy warned. “Time management will be key to accomplishing the majority of your tasks, (but also) take a step back and determine if it is time to hire someone and/or individuals on board to assist.”
Finding a mentor who can help would also useful later. Lambert advised to find mentors who can help to navigate the myriad challenges that come with being a business owner.
And lastly, Romero said, “be open to learning, learning, and learning. You will make mistakes—lots of them. Learn from those mistakes, move forward, and improve on those mistakes.”
Source: AllBusiness.com
