SBDC: 8 tips to start a small business
May 11, 2011 at 12:11 a.m.
Are you considering starting your own small business? If so, here are a few key topics to consider before jumping in.
Don't be too hasty to agree to a partnership.
Many times people go into a partnership because they are afraid of the unknown and want to share their fear. That's not a good reason for having partners.
In a short time, you'll overcome your fear, but you are going to be stuck with your partners for a very long time. The only time you should have a partner is when he or she provides something you don't have. However, needing more cash is not a good reason to partner.
Know your cash flow.
Your business lives and dies with cash flow. Make conservative estimates about sales and costs.
Know how much it will cost to start your business. The No. 1 killer of small business is negative cash flow. Don't become a victim.
Know the market.
Work in the industry before you open your own shop. You might even realize what you thought would be a fun and exciting business isn't that fun once you are responsible for keeping it open.
Marketing and sales.
In order to own a successful business you have to be comfortable with marketing and sales. You might have the best products in the world but if people don't know about them, you won't keep your doors open.
You owe it to yourself to reduce risk whenever possible. You accomplish that by really knowing your industry and by being on top of your cash flow.
You also need to understand a little about law. Should you form as a dba, S-Corp, C-Corp, LLC? This is where having a good business attorney and certified public accountant is smart.
Also reduce risk by having the proper business insurance in place.
You business plan won't guarantee success but you can almost guarantee failure if you don't have a plan.
Ideas are wonderful but business is about execution. And proper execution demands that you have a good solid plan and understand all the details.
It's true that you need a good solid business plan but you also need to be flexible. Nothing occurs exactly as planned. You have to be willing to go with the flow and be willing to upgrade your business plan as conditions change.
Focus on your goals.
The reason you go into business is to have more control over your life. Therefore, your goal should be to make your business a financial success.
While you certainly can use your business as an expression of your passions and values, your business must be profitable.
Be prepared and research your ideas. The more prepared you are when the doors open, the better the chance you and your business will survive.
The University of Houston-Victoria Small Business Development Center will help you with your dream of starting a small business or any other business question.
Kacey Butler is a UHV Small Business Development Center senior business advisor who works in Gonzales and Karnes counties. She can be contacted at 361-575-8944, or email lindemannbutlerk @uhv.edu.