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Ans11. Decide What Products or Services Your Small Business Will Offer
Seems simple enough right? But you would be surprised how many people jump into business with out ironing out this MAJOR detail. There is also a major difference between your main stream of revenue (which should be your focus) and all of your other secondary ideas for producing income. Some questions to ask about your product/service:
What makes you an expert in your industry or what makes your product different from the rest? Does the product or service meet a need? Have you thought about the future of your market? Where are trends headed? Is your product riding a wave or already being phased out?
Most important question! Are you passionate about your product? Do you love it? Does it keep you up at night? Would you wake up every morning excited to work on this business? Your business is going to be your livelihood, so you need to love it. Success does not happen overnight, it will take time months, even years to make big strides. If you arent in love with your business you will stand a good chance at losing the motivation to push forward. Is this something you could see yourself doing for the next 5-10 years? Your energy and excitement will also show through with your clients and customers. It will be a lot easier to make sales and get people to listen to you if you are passionate about your product and service. You should not have to put on an act when talking about your company or marketplace, it should flow just like a baseball fan talking about the World Series or a music lover talking about their favorite band. The people that love their business work on the weekends not because they have to but because there is nothing else they would rather be doing!
What demographic are they from? Age, sex, geographic location, income level, education, buying habits What do they do for work and for fun?
Where do they hangout? Where do they get money from? ie. If your market is children you may want to look at their parents. What common traits do they have? What are their common goals? What influences their decisions? You also need to define your competition. Spend the time researching your industry to dig up everyone who is doing anything in your field. When your customers say have you heard of so and so. you want to be able to say yes and here is how I am different or better.
What need or want are you filling? What problem does your business solve? What is your mission? How big is your market? (Everyone is not an answer) How will you target that niche? How are you different? What is the outlook on competition? Are their barriers to entry? How will you market your business? (Please say more than Facebook) How does your business make money? What is the business structure, how will it operate and whos involved? How does your product or service actually work? How is your product or service distributed to the customer? Why will your business be successful? How do you plan on scaling your business? What are the costs involved? Need startup funding? How much money does your company have the potential to make? When will your business make money? When are the investors going to see ROI? What is your exit strategy? The more specific you can be the better. This is the most important part of your plan is the hook. You should be able to clearly pitch and describe your entire business in this document so an investor will understand it and see the potential. More importantly it makes you write down and define your ideas and goals and create a plan to get there. This is something to hold yourself accountable to so you will have a better chance at succeeding!
Sole Proprietorship Partnerships Corporations Limited Liability Company The basics of each: Sole Proprietorship: Benefits:
Your personal assets are vulnerable to creditors and lawsuits Dont get certain tax breaks Your company name is not protected from someone else taking it
Partnerships: Benefits:
If your partner messes up you are accountable More difficult to raise funds Company name is not protected
Corporations: Benefits:
Shields you from personal liability Numerous tax benefits Company name protection Flexibility to raise capital C-Corp and S-Corp options for different tax structures
Negatives:
Initial fees and paperwork to set-up Maintenance Annual reports and up-to-date corporate records
Less on-going paperwork then corporations Shields you from personal liability Tax flexibility Company name is protected Negatives are limited but vary against each type of structure. Summary: Limited Liability Companies (LLCs) have become increasingly popular because they combine a lot of the benefits of corporations and sole proprietorships with few of the negatives. 5. Finding Funding Any business you start is going to have some funding needs. Even if they are minimal you need to figure out how you are going to cover them. It doesnt matter if you need $500 or $500 million. Lets look at a few of the basic options . Friends, Family and Fools This should be everyones first step when looking to raise some money. Go to the people you are closest to and that trust you. Ask your parents and family members to make an investment in your business rather than birthday or holiday gifts this year. Also, ask them to reach out to their friends who may find it interesting to put up some money if they believe in what your doing. Maybe they pitch in and buy you office supplies to put under the tree.
Marketing: Now that you have your brand its time to show it to the world! This is where the marketing comes in. There are various ways to market and you can choose one or a bunch of them. Grassroots This is the most basic of marketing that every business should be involved with. Attend local events and network with people. Hand out business cards or brochures. Tell friends and family and let the business spread via word of mouth. Online Marketing Being online is crucial in todays business environment. Your main marketing material is your website. Get a professional and get SEO help so you can generate leads in your sleep! You can also advertise on search engines (its how Google makes money) but do the research and understand how to build a solid campaign. Get involved with social networks like twitter, facebook, youtube and linkedin. There are also a million small niche groups and forums in your industry somewhere online. Its important to understand how to get involved in the community so you are not mistaken for a spammer! But with the correct methods and the effort these free tools are priceless! You can also buy banner ads online as I am sure you have seen on sites at some point. While not as effective as other methods if you find the right site with a loyal niche audience banner ads can still prove successful. PR Marketing While time consuming this can help get your company in front of large audiences. It will also help brand you and your company as experts and increase credibility if you get noted in the right sources. Make sure to take the time to draft up solid press releases or pitch interesting angles to reporters for stories. You can also search online for bloggers and sites that interview startup companies or experts from your industry and ask to be included. Traditional Advertising - While fading traditional advertising still has its places and can still be beneficial. Looks for local publications to buy ad space in or local radio and tv channels.
Oues 2- Essential Components of Viable Small Business Ideas. Ans 2You probably have many small business ideas that you're considering at once. How do you know if any of them are viable? Here are 6 essential components of viable small businesses that will help you make a decision: 1. It's Recession Proof You don't want to find yourself building a new small business, only to see it diminished or eliminated by a recession. Although no business is guaranteed to survive hard economic times, there are some businesses that do fine and others that flourish during an economic downturn. While you shouldn't choose a business on this basis alone, it's worth considering. 2. It Adds Value A business adds value to clients, but a scam robs people of their hard earned money. Adding value makes your business viable because people will do business with those who improve their lives. As you look for home business ideas, stay away from get-rich-quick schemes that only add value to those selling you their "system." Pursue ideas that serve others with products or services that are useful. 3. There's a Way Out Otherwise known as an "exit strategy," make sure you will be able to sell or successfully close any small business you're considering. For example, if you're looking to start a sewing business, you need to consider how you'll leave that business. Will you be able to sell the business or your assets? Is it more viable to have an online store selling sewing related products than to hand sew items? As you consider each idea, make a note of the ways that you can leave each business in a way that makes it financially worth it to start in the first place. 4. It's Expandable You may be satisfied with working alone now, but you should still keep your options open for possible expansion in the future. This doesn't mean that you'll no longer work at home. You can still grow a thriving business from home, using all sorts of outsourced help. A viable small business idea should allow for growth and expansion, even if you never actually do expand. 5. There's a Sound Business Strategy You want to consider businesses that have a sound business strategy and business model. For example, pyramid schemes are not a sound business strategy and are illegal. Most multi-level marketing programs are not based on a sound business strategy, because you'll have to recruit sellers rather than sell directly to customers and clients only. Writing articles full-time for a percent of advertisements and making $1 or $2 a month for a year is not a sound business strategy. 6. It's not Risky There's some risk involved with any business you start. However, you don't want to get wiped out financially or emotionally by a business that's just too risky. A viable home business idea should not have you breaking the bank. Low start-up costs are one of the
reasons why people work from home in the first place. Also, stay away from small business ideas that require you to pay them for the privilege of doing business. There are many considerations to make when starting a new business, and there are many small business ideas to choose from. Only consider the ones that are viable, and be sure to weigh other important factors, such as your skills and training, the market and the competition.