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The Dos and Don’ts of Starting Your Own Business

Fri, 11/09/2012 - 4:26pm | by Guest Contributor

Starting a business isn’t as simple as setting up a lemonade stand; although Togo’s, for example, really did start with a college student serving sandwiches out of his house.  There are a lot of steps to be taken if you want to go from a light bulb over your head to running your own company.  But with unemployment high and stock portfolios low, a lot of people are starting to think about ways that they could use their talent and passion to become their own bosses.  If you’re starting to think along these lines, despite the recession, then there are a few things you should know about what to do and what to avoid when starting your own business.

DO:

1. Find a niche.  Just because you have a great idea doesn’t mean it will sell (or that you’re the only one who thought of it).  You need to consider how it’s going to fit into the current marketplace, how you can make yourself heard over all the chatter from competitors, and how you’re going to sell it to the public.  If you have a product that is truly useful and unique, you should have no problem.  But those are few and far between.  Most entrepreneurs have to settle for doing something that’s already out there but putting their own spin on it.

2. Make a business plan.  It doesn’t matter if you graduated from business school or you’re just an average Joe looking to open a store; you’re going to need a business plan to get a loan.  Of course, there are more benefits to creating a solid business plan than gaining funding.  You’ll also end up with a roadmap that will help you to make your venture a success.

3. Create an online presence.  These days you cannot hope to compete without an online presence to match (or replace) your real-world presence.  It will not only help you to reach customers in a way that was impossible just a couple of decades ago, but it can also allow you to build up a brand image incredibly quickly.

DON’T:

1. Skip the research.  You need to know, going in, what the market can bear in terms of an enterprise like the one you’re planning, as well as what you can expect to see in expenditures and earnings.  You must track demographics in your area of operation, sales for similar businesses, and the overall economy.  And this is before you even open the doors.  There’s a lot more to it, of course, but the point is that you can’t simply rest on your laurels and hope everything works out.

2. Limit yourself to one lender.  Banks have been notoriously spare with loans over the last couple of years (not surprisingly), so if you find that you’re having a hard time securing a bank loan, look for other types of lenders instead.  Personal loans (from family and friends), business partners, angel investors, and venture capitalists may all be options that you could explore, depending on what type of funding you’re seeking.

3. Stop at a website.  You can’t just buy a domain name, post a couple of pages, and hope that’s good enough.  There’s so much more to having an online presence these days that you really need to be proactive about finding ways to expand your sphere of influence in the virtual and mobile space, at least if you want to be successful.

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