It is easier than ever to start your own business. The internet has provided a global marketplace. At first glance, this article is going to seem a little like it is trying to throw water on your flame and passion. It is going to sound like a depressive stomp on your dreams because it focuses on the drab side of starting a business.
But, perhaps if you are to succeed, you need some water throwing on your fire because your start-up fun soon begins to feel like work, and the sooner, the better if you want to succeed.
Start-Up Spending Is Not Fun
The biggest mistake many start-ups make is to enjoy the start-up buying. Why not since you have your fresh bundle of cash and exciting new business to start. However, in a few months, you are going to be broke and wishing you hadn’t bought the extra-large van with light-up alloy wheels and a glow-in-the-dark paint job.
Keep your start-up costs as low as possible because you are going to need all the money you have to cover overheads during your rocky first few years. Try to buy things second hand, and do not opt for high-end equipment.
For example, running off color copies at a print shop is far cheaper than purchasing color printers and printing in color yourself. You will probably not need color printers, so opt for the best black and white printers within a reasonable budget.
Advertising is Going to Burn Through Your Money
Ideally, you need to find a way to get new clients and new customers before you even start your business. If you are starting your business without a large number of pre-orders, then you are probably going to struggle.
The hardest part of any business is convincing people to give you their money. Getting sales is going to eat up a lot of your money, so you need to concentrate on it more than your product.
Plus, when you are up and running, you need to come up with as many new ways to promote your business for free, including signing up for “Google My Business” and learning all about referrals and how to get them.
How Are You Getting Your Product Out There?
You are probably going to start small, but if not, then you may even have to look into choosing the right shipping company for your business, both on a small scale such as national deliveries and larger-scale transport like trains, planes, and boats.
Getting your products to your customers requires the right timing, safe passage, and reasonable costs. There may also be extra paperwork if you are shipping abroad.
Advertising is a significant expense, but it is a variable expense that doesn’t have a direct impact on your costs, and ergo on your prices. However, shipping always impacts your rates, and many small businesses (especially eBay and Amazon businesses) have gone under because their profits were mopped up by shipping costs.
Plus, there is the added worry that low prices often equate to low quality, which is bad news if you are shipping white goods, but not so bad if you are shipping sponges.
It is great to be enthusiastic about starting a new business but don’t get carried away by the excitement. Draw up a detailed start-up plan, including expenses and stick to it. It is far more satisfying to upgrade because of success and growth than it is to fail because you didn’t control your start-up costs.