The first step in setting up your own business is finding the right idea in the first place. While many people relish the idea of no longer having to work for “the man”, establishing yourself as an entrepreneur may not be as simple as you imagined.
Today’s modern marketplace can be a very crowded one, and without a well thought-out business idea and an effective business plan in place, the chances of success are small. As many as 50% of all new companies go out of business within the first five years, so having a robust idea and plan is vital.
What Field Should I Set Up My New Business In?
If you’re ready to set up in business on your own but don’t know which sectors to consider, it’s time to think hard about which niche you’d like to fit into.
There are lots of directions in which you can take your own entrepreneurial ideas. For example, are you a creative person with artistic skills? Do you want to sell products? Do you have a particular passion or skill which you’d like to exploit for money? Here are some ideas to help get you thinking:
A creative business
Do you have an artistic skill which you could harness for profit? If, for example, you make your own jewellery or have an interest in interior design you can use those abilities as the starting point of your business.
Follow your passions
Do you have a particular interest in a hobby which could make you money? Perhaps you love sports and could set yourself up as a personal trainer? Or perhaps you love the performing arts and want to set up a drama class for children? Freelance your expertise and reap the profits.
Product sales
Retail has long been a traditional option for anyone who is setting up their own business. These days, there are many different options available to enterprising retailers from eBay and other online marketplaces to local markets and kiosks.
- B2B business ideas – if you have skills that you have developed in other jobs, you can now apply these to your own company. B2B businesses are highly in demand, and if you can offer your expertise in bookkeeping, consulting, transcription, writing, computer programming or administration this could be a valid option for your business idea.
- Public services – there are many services which you can offer the public which could be an excellent choice of business. Pet sitting, childcare, cleaning services, mobile photography or event planning services are just some of the many ideas which you may want to bear in mind when generating business ideas.
Obtaining Finance
Not all business ideas require a huge amount of investment capital. There are a lot of low cost business ideas which involve very little financial input. Many online business ideas, especially those which involve using your freelancing skills, involve almost no initial outlay at all as long as you have a computer and a broadband connection.
A retail business will obvious require some initial outlay, but if you choose to sell online you will not need to pay for physical premises or any of the other overheads associated with having a real-world store.
There are many hidden costs involved with running a business, including insurance costs, so making sure that you are aware of the expenses involved before you launch your business idea is essential. If you need to secure any funding for your enterprise this must be done at as early a stage as possible, and having a business plan in place is a key aspect of getting a loan, investment or sponsorship.
Making A Plan
Once you’ve settled on your business idea, the next step is to generate an effective business plan. This is a key element in creating a successful company, so make sure to take this step before you jump into your entrepreneurial role.
Without a business plan, you’ll have no idea in which direction you’re going to take your business, and without any goals or aims in mind, you won’t know how to put steps in place to ensure your success.
If you need to obtain funding for your company, you’ll need to have a business plan in place as part of the application process, so make sure to do this before you get started.
Doing Your Market Research
Before you generate your business plan, you need to carry out some market research to ensure that your idea is a valid one. Is anyone out there to use your service or buy your product? And if so, who are those people and how can you tap into the market? Market research has a vital role to play in shaping your resources and marketing plan, and in making your company a profitable one.
There are lots of ways in which you can do market research. First, you can begin at your very own PC doing research on the internet, however it’s also important to actually go out and speak directly to potential customers. If you have a service or product, you need to test it in person and build up your brand through user interactions.
Market Research Techniques
There is often inconsistency between the things people say and people do. Observing your business market is therefore important to gain valuable customer insights. It’s also important to talk to people and listen to what they have to say. Surveys and interviews are both important aspects of market research while focus groups also can be useful in getting a wider picture of the market. If you have a product or service that you are selling, the ultimate market research involves finding customers who will use or buy your product so you can see how well your idea works in practice. The data you obtain through these techniques is vital to inform your effective business plan and also to inform any potential investors, lenders or sponsors that your idea is a valid one and can succeed in its identified market.