Small
Business Examination Friday: Beginnings
This Friday, and for the
following Fridays up to January, I will start to talk about small businesses as
they begin and prosper. This guide is designed for the reader to understand
that even with this, a small business or franchise is a lot of work and
motivation. Most individuals create a
business or franchise because they have a dream of having a successful
business. As crazy as that sounds, most
true entrepreneurs aren’t too worried about the money, because they understand
that a successful product begets money automatically.
Today’s Friday starts
us at the beginning of a small business adventure. You are interested in
developing a small business but have no idea how to get started. The first
thing you’ll need to do is ask yourself a few questions:
Do you have a business
plan with exactly what your short term and long term goals are?
Do I need a loan for
this business or can I do this on my own?
Do I have all the
capabilities of advertising for myself or will I need help?
If something happens
and a catastrophe strikes, will I be able to recover?
These are extremely
important questions to ask yourself, because the way you pave your business
needs to be with expecting the worst case scenarios. I’ll go through each
question one at a time and we’ll go over the scenarios.
Do I need a loan for
this business or can I do this on my own?
Consequently, this is a
road block that hits individuals who may be good entrepreneurs but simply don’t
have the credit to get themselves a loan all the time. Most 401k’s that are
paid into because of a full time or part time job can be borrowed from, and
repaid regardless of your credit history. This way, if you’re 18-20 years of
age, and pay into your 401k for 10 years, you could set yourself up with
running a small business by the time you are in your early 30’s.
You will also need a
business plan, as a bank or small institution needs to see some sort of
paperwork or documentation that you took the time and effort thinking
thoroughly about your business.
Do you have a business
plan with exactly what your short term and long term goals are?
Business Plans are a
packet of information that has any research, information, and costs associated
with your business. This packet is very important for the creation of your
business, because it will be necessary for the bank to take a look at it and
make a determination as to whether or not they trust your judgment. I highly
suggest reading more on business plans and taking a look at a few guides that
point out the top 10 do’s and don’ts of business plans.
Do I have all the
capabilities of advertising for myself or will I need help?
Small
businesses suffer from lack of advertising, and as such not only cause
headaches but dismay. Imagine, what if you could make cupcakes better then
every individual in the area, but you lacked the resources to tell everyone? Crowds
will flock to Wal-Mart to buy their
cupcakes that they have for the sake of its customers and your gourmet cupcakes
will sit on your window, collecting dust and no revenue. Make sure to do
research in the creation of a professional Facebook page, eventual web site,
and things like Google ad-words and Facebook advertising. Without social media
advertising, with updates weekly if not daily, your business will be doomed to
fail.
If something happens
and a catastrophe strikes, will I be able to recover?
If you owned your cupcake business and one of the
machines went down, would you have the money or the capabilities of fixing the
machine? A common mistake with entrepreneurs is a failure to borrow enough
money to cover the “what ifs”. Common mistakes like this could spell disaster
in a huge scale, especially if plans were made prior. Imagine a situation where
you made a deal with a local school to make cupcakes for the PTA. 2 days before
the beginning of the baking, your machine shorts out, and you find out its 500
dollars to fix. You simply don’t have the money because this turned into an
interrupted expense. Now, the PTA that you planned on impressing and doing
advertising for will feel that the business is lackluster and in 6 months, lose
out on over a thousand dollars worth of customers because of the blunder.
Next
Friday, we will move on from here to the development of a product, more on
social media marketing, and research and development! Until then, happy
entrepreneuring!
If you
have any suggestions as to information you are curious about or suggestions for
examination Friday, don’t hesitate to e-mail me at Theodore.holten@yahoo.com
with any questions, comments, or concerns!
Theodore Holten is a Business major with an associate
degree in business administration. Ted has been in the business of turning
around small businesses using innovation and technology for the past 4 years.
