Posted on February 27 2017
About a week ago, I jumped on my first live Insta Video and talked about some helpful questions to ask yourself before starting a business. They're questions that will help set the perfect stage to creating a successful business, or if nothing else, questions that will lead you down the right path.
I do a lot of reading of articles and business books, so this information is nothing new by any means, but simply a compilation of tools that have helped me thus far. I apologize in advance for not having direct quotes or resources cited, I will do my best to go back and annotate what I can! College English here we go...
The Big 5 Important Questions Before Starting a Business
1. What Problem Am I Solving?
Before starting anything, you have to ask - what problem am I solving? Or how am I helping people simplify their lives? If you're looking to start a boutique - the competition is high, and fierce. You have to find a way to break into that niche by offering something unique only to your store. It may change along the way, but don't worry, starting out doesn't have to be perfect. And that's something I'll talk about more later on.
2. How Much Money do I Need to Start?
I shared on my video that we initially funded this company with the last of my husband's savings (while he was still studying away pursuing dental school.) We just had our first baby and money was tight. But we didn't feel that we had the connections or resources at the time to look into an investor. With our small savings we were able to buy what we needed to get started and then applied for Business Credit Cards to help continue the startup fund process.
If you're looking for a good Business CC, I highly recommend Chase Ink Cash Rewards, or AMX Business or the Blue Cash Card. These cards do not have annual fees and some will give you a free APR for 9-15 months depending on your credit.
3. Who Are My Competitors?
I believe there is always more than enough business to go around. Don't feel threatened or insecure by your competition. It will always be there and if you constantly focus on what they're doing or "how much better they are than me" you will fail. Simply take the positive aspects of each competitor, see what they're doing right, possibly things you'd change about what they're doing and then make it your own. Look at competitors directly on your level, as well as your big competition.
For example, I notice boutiques similar to my size, but then I also look at big retail stores and see why they do what they do. It helps me learn from their mistakes without having to make such big ones myself.
4. What Makes Me Different from the Rest?
Look back at the problem you're solving and then find what you can do be different than the rest. If you're having a hard time figuring out what that might be - again turn to your competition to get ideas. Tap into an area where another competitor hasn't gone yet. Or take something that's already being done and make it better. There's no need to reinvent the wheel because everything you're thinking about has more than likely already been done.
5. What Resources Do I Have to Start Now?
Going back to what I said in the first question, set your perfectionism aside (which was/is so hard for me to do) and just dive in. You don't need the perfect website, or photographer, or model, or whatever it may be - just make sure you have great customer service, and a product/s that people can't get enough of. Over time, as you continue to invest in your company, you'll be able to perfect things here and there as you'd like and create the brand you so desire.
On a side note: If you want to learn from a company's mistake - check out the recent article about Nasty Gal and how they went from being a multi-million dollar company to filing for Chapter 11 Bankruptcy. Hint: they focused more on the creative side, and buying expensive offices than keeping their customers happy.
5 Beginner Mistakes Anyone Can Make in Starting a Business
In addition to those 5 questions, I wanted to briefly add 5 mistakes almost everyone makes when they start a business. Hopefully understanding this will give you a leg up in your niche.
1. Expecting Overnight Success
Sometimes, it's easy to get caught up in these great small companies that you hear about turned big overnight. Yes, it happens - but not nearly as often as you think. Overnight success stories are rare and far between. That's why you hear about them, because they're so unique. What the media doesn't tell you is how much small business owners work just to stay afloat. Set realistic goals for yourself and do some research into other businesses in your niche and how long it took for them to become profitable. They say on average, it takes 3-5 years for a startup company to start actually making money.
2. Expecting Sales to Just Roll In
I'll admit, when I started Paige Avenue as a way to make some income to help our family ease the debt of dental school, I was very naive as to how long it would actually take to see that money roll in. I had very high expectations for the company and was sorely disappointed and ultra stressed when I realized that those expectations were not reality.
You must be willing to do the grind work to get those sales trickling in. Just because you're offering something you think is wonderful, it doesn't mean others will. Now, I understand as a startup money is tight and you can't afford to market yourself like you'd like to, so focus on a small scale. Attend local events, network with people, find influencers who are close but a little more than your level of awareness, reach out to people on social media, build a strong following on Pinterest. Yes, all of these things take time, but without an investor and/or dumping a ton of money into your startup, it's how you stay alive in the beginning.
3. Failing to Do the Little Things
Remember how I said your customers are everything? Don't get too caught up in growing your business, that you fail to keep your customers around. Trust me, it's easy to do when you're trying to balance so much on your own until you can hire employees.
I like to set up a daily to do list of all the little things I need/must do to keep my company flowing such as: posting on Instagram, looking for small ways to give back to my customers, building my presence on Pinterest, keeping track of all of my business expenses, etc..
I recommend investing in a platform that will help you keep track of all of your expenditures to make things as smooth as possible for tax season.
4. Not Having a Long Term Plan
I cannot stress this one enough...If you do not have a long term plan, meaning if you're just starting this business on a whim, it's NOT ENOUGH to keep it going. I repeat, it will NOT be enough to sustain your new business.
Make sure before you begin, that you create a business plan with steps and goals in place to reach your ultimate goal. Having that ultimate goal is what will drive you when money isn't coming in and you're on the verge of giving up.
5. Not Willing to Embrace 100%
Finally, one of the hardest yet easiest things to do is not fully embracing your new path of entrepreneurship. If you're starting a business to work less now, quickly change that mindset. Starting a business is so exciting and can offer great flexibility in schedule, but until it's up and running with some help - it can really be time consuming. Be prepared to sacrifice in order to be successful!
I know a lot of this can sound overwhelming and maybe overbearing ;) but I'm here to tell you that it can be done! If you're willing to work harder than you've ever worked, you can do it! If you have any questions, please feel free to email me at firstname.lastname@example.org
Love your guts,
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