Start Your Own Business

Know what it really takes to succeed

December 12th, 2010 BY Claire Moore

Is it your dream to own your own business? You’re not alone. Every year thousands of Americans take the plunge into entrepreneurship by either buying or starting their own business. If you want to be one of them, then you have a lot of homework to do.

First, decide what business you want to start. Do you want to sell a product or a service? Will you be making the product yourself or buying it at wholesale then selling it at retail? Will you need to have an office or storefront or can you run your business from your home?

Whatever you want to do as your business, you need to find out as much as you can about that business before you commit your time and especially your money in starting it. Your research may result in the decision that it just isn’t worth it to try and start this business. If that’s the case then it will be disappointing but at least you won’t be broke.

For instance, if you want to start a specialty restaurant, ask yourself how much experience you have running a similar business. Do you understand how much food you need to order? How to store it? How to find the right vendors and negotiate deals with them? Do you know how to hire and manage employees? Do you know all the health codes you will have to follow? Do you know what permits and licenses you’ll need? That’s just the beginning.

Do you know what items you intend to offer on your menu? Do you know how much it will cost you to make those items including the input from labor, rent, and utilities? Do you know what you have to charge for them in order to make a profit? Will the people who come to your restaurant be willing and able to pay those prices? Do you know where you’ll advertise in order to reach the kind of clientele you want for your restaurant? Do you know how much it will cost you to advertise there?

If finding the answers to questions like these makes your head spin, then you should take your time and maybe take some classes before you go too much further in starting your business.

Even buying an established business won’t help you if you don’t have the required knowledge to manage it and make a profit. In fact, buying a business presents the additional challenge of investigating how stable the business really is. Why is the owner selling the business? Is it because there’s a problem? Does the business have a good or a bad reputation? Are the business finances good or do they indicate impending doom? Would you be able to tell?

Ok, then. What about buying a franchise? They have a good reputation, a track record, and a name brand should be profitable right? The management of the business has already been worked out and put into place. You’ll get training, advertising and management assistance right?

You need to do extensive research before purchasing a franchise. The fees to buy a franchise typically start in the five-figure range and once you buy into the franchise, it may be difficult to get out if you change your mind. You will have to run the business according to the franchise’s rules and you may have to pay monthly fees for royalties and advertising whether you make a profit or not.

Where can you go to start your research?

* Your local Chamber of Commerce is a great resource for networking and researching for your business. To find the chamber nearest you go to http://www.businessfinance.com/chambers-of-commerce.htm

* A wealth of online research information can be found at the Small Business Development Center National Clearinghouse site http://sbdcnet.org/. On the home page you will find a link to help you locate your local SBDC office.

* SCORE is a nonprofit organization that works in partnership with the U.S. Small Business Administration (SBA) by providing free and low-cost information to small businesses nationwide. Go to http://www.score.org/explore_score.html.

* Talk to the research librarian at the main branch of your city library. Librarians are skilled in finding facts and they are extremely helpful.

DISCLAIMER: In the interests of full disclosure, please note that from time to time, this website recommends products or services we have found helpful. In some instances, we will receive compensation or commissions if you purchase one of the products and/or services we discuss or recommend.

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