Going into business — whether home-based or not — is always inspired by our desire to be the boss, work at our own time, and of course, make more money. You start a business hoping that its profits will be greater than what you received while working for somebody else. Or maybe, you suddenly have this brilliant idea that you think could work and even become profitable. Sometimes, entrepreneurship becomes an option when you suddenly find yourself walking in the cement jungle looking for a job after your boss fires you.
There might be other reasons for wanting to start a business. But whatever they are, going into business often means working it out from scratch. As an entrepreneur, the first thing you must have is GUTS. As the old adage says, “No guts, no glory.” To poker players, they say, “guts…to open”. With guts, a bright idea, a little start-up fund and lots of luck, who knows, you might be a winner. Follow your instincts but don’t forget to take notes as you go along.
First, decide on what kind of business you will put up. If you plan a home-based business, you can save on the up-front rental and lease money. With a smaller overhead cost, you can plow more resources into building your business.
On the other hand, if you intend to open a small store, observe the area of your desired location and see if the place could attract the kind of market that you envision for your business. Check the kinds of people who frequent the area and study its demographics. Note that the quality of the neighborhood could affect your business.
Then conduct a simple survey of your market. Know the buying habits of your target market. The more you know about your market, the better you can tailor your product offerings for them.
Let us consider a sample business, say a photo shop. Our reason is simple: everybody loves memories. Despite the advent of digital cameras, people still love to take pictures everywhere, day or night, either in color or black and white.
To be a successful entrepreneur, it is imperative to understand what your business is all about. In the photo business, for example, you are not selling pictures or films; rather you are selling mementos and keepsakes of important events in people’s lives. You are not selling a product, but you are selling the means to fulfill your customers’ needs. Knowing what it is that you are really doing can help you a lot in properly branding, marketing and selling your product.
Location is everything in a brick-and-mortar business. You want to be in the middle of your market, not in some faraway place where dozens of your competitors can get to your customers first. For your photo business, you may want to find a store in a strip mall, near a school or a busy intersection.
Once you have found the right location, negotiate your rental and the up-front fees with the landlord. Excellent negotiation skills are essential to any businessperson. Look for a soft spot in your landlord during negotiations. Somewhere, somehow, you might be able to convince him to give you a one-month free rent while you are starting-up. Landlords also need your business and most of them will consider giving you little incentives if you present your situation, honestly. At this point, you can negotiate by just asking to pay one month in advance and pay the security deposits and others in succeeding months. Remember, nothing is impossible; you just need to try.
By now, you should have decided what name you should call your shop. Name your store with something that correlates your product with the words. The theory is to create a name that customers can easily visualize and relate to their needs. This is following the footsteps of products that has become by-words, like Colgate for toothpaste, Tide for laundry detergent, Coke or Pepsi for soda, Bud for beer, or Kodak for pictures.
So, let’s call our photo shop “Color Mat.” Does the name signify something about photography? The word Color gives the idea of a rainbow and connotes a happy sound. Mat is a carpet. Color Mat therefore means a carpet with many colors. And photography is color.
In business, creativity is crucial, particularly if you have little funds. If you do not have sufficient funds for your initial inventory, try talking to a competitor nearest your shop and borrow some of his stocks. You can tell him that you will buy your supplies and inventory from him if he gives you a little credit. To be more convincing, you can even tell him that you will give him your payment from your daily sales before he goes home at night. Take him to your store to give him the assurance that you are indeed serious, except you lack cash. Some entrepreneurs are more than willing to help out other start-ups.
If you don’t succeed on this approach, you can put a little amount as a deposit where he can deduct the merchandise that you get every time. The guy has no reason not to help you out because your offer will increase his sales. When you are up and running and he notices that your sales is growing, he might even forget that you no longer have a deposit.
Try to save as much as you can from the profits you make and pay your suppliers ahead of time to give you a good credit standing. You will need good credit references when you start negotiating for bigger volumes.
Starting a business with little resources is like playing baseball with only you covering the whole field. You are the pitcher, the catcher, the first base, the runner and the umpire. Your store will start to grow, although at a snail-pace. Be prepared to face a lot of challenges, and patience and a lot of hard work will be your best allies.
Most start-up entrepreneurs even find that they need to shift to a simpler lifestyle as all their resources are channeled into the business. Even your time for leisure will be dramatically cut. Be careful in protecting the trust and support that you have earned along the way.
Total devotion to your business, honesty and sincerity to the people that you deal with, will take you to higher levels and allow you to branch out in a matter of time. There will be a lot temptations and pitfalls that you need to be prepared for. Starting a business is a complicated process.
Hey, no one said success is easy!
Recommended Books on Startup Businesses:
- The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses
- Startup Weekend: How to Take a Company From Concept to Creation in 54 Hours
- The Six-Figure Second Income: How To Start and Grow A Successful Online Business Without Quitting Your Day Job
- Shoestring Venture: The Startup Bible
- Pros and Cons of Financing a Business
- Top 10 Ecommerce Mistakes
- 12-Step Template to Write an Effective Sales Letter
- 10 Rules for Starting a Business on a Shoestring Budget
- Book: The Last Chance Millionaire