6 Things You Should Know Before Starting Your Own Business

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Are you tired of the 9-to-5 grind and ready to be your own boss? Does the thought of building something from scratch get your heart racing, but you're not quite sure where to start? 

You're not alone, and you're in the right place! Starting your own business is like embarking on a thrilling adventure. It's full of ups, downs, and plenty of unexpected turns. But don't pack your bags just yet! Before you dive in, there are some essential things you need to know.

In this guide, we'll cover everything from discovering what truly drives you to making sure your business is on the right side of the law.  

Ready to learn these essential tips? Let’s get started!

1. Discover what drives you

You know that excited, can't-wait-to-get-out-of-bed feeling you get about something you absolutely love? Imagine waking up every morning with that energy for your business! It's a game-changer, right? 

1. Find your passion

But wait, let's hit the brakes. As cool as it is to do something you're passionate about, remember that passion doesn't always pay the bills.

On the flip side, a business solely focused on profit might make you money, but it might also make you miserable. The sweet spot is somewhere in the middle; something you're enthusiastic about that also has money-making potential

Within the discussion of six key considerations before starting your own business, understanding the principles of business administration becomes essential for effectively managing operations, finances, and strategic planning to ensure long-term success and sustainability.

Why having a mission makes your business stronger

Here's a secret: people love supporting businesses that stand for something. Whether it's reducing waste, helping the community, or advancing technology, having a mission makes you memorable. 

Not only does it give customers a reason to choose you over Joe’s Shop down the street, but it also keeps you motivated when times get tough.

Quick activity: list your top 3 business goals

Let's get those creative juices flowing! Grab a piece of paper or open a new document on your computer. 

list your top 3 business goals

Write down three goals you have for your business. They can be anything from "Make enough money to pay off my student loans" to "Hiring for your startup to provide work for your community." When you look at these goals, do you see a blend of passion and profit? 

If yes, you're on the right track. If not, think about how you can tweak them to find that golden middle ground.

2. Be ready to put on many hats

Ever heard the saying, "Jack-of-all-trades, master of none"? Scratch that. When you're starting your own business, you'll have to be a Jack-or-Jill-of-all-trades, and you'll need to master them too. 

At least until you can afford to hire experts. One minute you're the CEO making big decisions; the next, you're the janitor cleaning the bathroom. That's the startup life!

Balancing different roles: CEO, marketer, cleaner, etc.

The variety keeps things interesting but also super challenging. Some days you'll work on marketing. Other days you'll handle finances or customer service. Sometimes, you'll do all of that in a single day! It's like spinning plates while juggling fire; don't worry, you'll get the hang of it!

Here are some tips to keep you sane:

  • Not everything is equally important

  • Learn to focus on what matters most each day

  • Dedicate specific hours of your day to specific tasks

  • It makes you more productive

  • Don't forget to breathe; short breaks can recharge your mind

Stress is the uninvited guest that always shows up when you're starting a business. But there are ways to manage it. 

Exercise, even if it's just a quick walk around the block. Talk to friends or mentors who've been there, and done that. And never underestimate the power of a good night's sleep.

3. Money matters: setting a budget

Let's talk about the elephant in the room: money.

Start investing your money

Starting a business needs some initial investment, even if you're running it from your garage. You've got to think about costs like:

  • Equipment

  • Supplies

  • Advertising

  • Rent

It's like buying the ingredients before you can cook up a business storm. 

Making a simple business budget

Alright, budgeting might not be as exciting as designing your business logo or choosing your store's name, but it's a must-do. So, how do you set a budget?

  • Jot down EVERYTHING you'll need to spend money on

  • Don't forget the small stuff like business cards or website hosting

  • Do some research and ballpark how much each expense will be

  • Get that calculator out and tally it all up

  • Add an extra 10-20% for unexpected costs

The Hidden costs you didn't think about

Did you budget for business insurance? What about tax preparation fees? These are the sneaky costs that often catch new business owners off guard. Keep your eyes peeled and your budget flexible.

Reality check: how long until you can pay yourself?

Here's a tough pill to swallow: you might not make a profit right away, which means you might not pay yourself for a bit. And that's okay! 

Business is a long game. The more realistic you are about when you can start drawing a salary, the less stressed you'll be.

4. Market research: know your competition and audience

You might think your business idea is one in a million, but chances are, there's someone else out there doing something similar. That's not a bad thing; it means there's demand! 

Research Market

But you also need to know who you're up against. Keeping an eye on the competition helps you find your own edge.

Who's going to buy from you? Defining your target audience

You can't please everyone, and that's okay! What you can do is focus on pleasing a specific group of people: your target audience. Maybe you're selling handmade dog collars and your target audience is pet owners who shop for eco-friendly products. 

Knowing your audience helps you tailor your:

  • Products

  • Services

  • Marketing

Quick activity: analyze one competitor and identify one target customer group

Time for a quick homework assignment (don't worry, it's a fun one)! Look up one business that you consider a competitor and jot down what they're doing well and where they could improve.

Now, think of one group of people who would absolutely love your business and write down some characteristics they might have, e.g.:

  • Age

  • Interests

  • Location

5. Make it legal: business structure and licenses

Business isn't just business; it's also legal stuff. One of the first decisions you'll make is what type of business structure best suits your needs. 

Is it a sole proprietorship, where you're the one-man-band calling all the shots? Or maybe an LLC, which gives you some protection but involves more paperwork? Understanding these options isn't just about fancy titles; it affects your taxes, liability, and even your ability to raise funds.

business structure and licenses

You might roll your eyes at the thought of filling out forms and standing in government office lines, but licenses and permits are more than bureaucratic headaches. They're your ticket to legally doing business. Without the proper permits, you might face fines or, worse, have to close up shop. 

Also, you should consider setting up a business bank account. You have a variety of their options available, including basic checking accounts and those that offer extra features such as a business debit card, online banking, round-the-clock customer support, and cash management services. 

Confused about what licenses you need? You're not alone. Thankfully, there are resources to guide you. Websites like the U.S. Small Business Administration (if you're in the U.S.) offer comprehensive guides. And don't underestimate the power of local business associations; they can offer valuable advice specific to your area.

6. Building your dream team

If your business is something you can handle alone (at least to start), that's awesome! But many businesses require extra hands on deck. Consider your workload, skill set, and the level of service you want to provide when deciding if you need a team.

Hiring 101: what to look for in your first team members

The first people you hire will set the tone for your company culture, so choose wisely. Look for individuals who are not just skilled but also enthusiastic about your business vision. A rockstar coder is great, but a rockstar coder who loves your mission is a game-changer.

How to manage people when you've never managed before

Leading a team is a different ball game altogether. It's not just about making sure work gets done; it's also about inspiring and supporting your team. Here are a few quick tips:

  • Communication is key

  • Keep channels open for feedback and updates

  • Set clear expectations

  • Uncertainty leads to stress, make sure everyone knows their roles and responsibilities

  • Your team looks up to you; be there to guide them, not just to boss them around

Your roadmap to business success starts here

We've covered a lot of ground, haven't we? Starting your own business is no walk in the park, but armed with the knowledge you've gained from this guide, you're already miles ahead of the pack.

Remember, every successful business started as an idea in someone's head! You're not as far off as you might think.

So what's next? Take these tips, your passion, and a sprinkle of courage, and get ready to turn that dream of yours into a reality. Your business journey is uniquely yours, but know that you're not alone. Resources, guides, and mentors are out there; all you have to do is take that first, brave step. 

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