In my last article, “How to Start and Grow the Right Business for You,” we discussed how to choose the right business if you are considering becoming an entrepreneur. Typically, the implementation of that choice proves to be daunting for many would-be entrepreneurs, either from the viewpoint of “where do I get help” or “I can’t afford to start a business.” Neither needs be a major obstacle.
The United States has always been the land of opportunity; anyone has the right and “theoretical” opportunity to start a business and be successful. The risks of starting your own business can be high, but the rewards can be well worth it.
The fact is, however, more businesses fail each year than start. In 2014, there were 514,332 new businesses started in the United States; unfortunately, there were 548,159 closures and over 55,000 bankruptcies, according to business stats.
There are many reasons why a business fails. They include poor product concept, lack of a reasoned business plan, undercapitalization, insufficient marketing efforts, and changing market economics.
So with statistics like these, how do you become a business success and not a business failure? The answer is to have a viable strategic and tactical plan, seek help, and be smart about how you set up your business and how much you spend to do that.
Five steps for starting a business for under $1,000
1. Have a strategic plan
All of us have heard of a “back-of-an-envelope” story, how many businesses are formed—and these stories do happen. However, it is typically the concept that happens on a back of an envelope, not the actual plan to bring that concept to the market. The first step is to develop a well-thought-out business plan that addresses key success factors such as:
Name of firm. Descriptive of your service or your name; companies with a description of their service or products generate more web visits than ones using fictitious or personal names.
Owner or owner-to-be. Are you going to be the sole owner or will you have investors or/and partners?
Information on the business. Information about the type, nature, and products of your business.
Market analysis. Consider customers, competition, and barriers to entry and success.
Market strategy. How will you generate sales, promote your product, and what media will you use to promote your product or services?
Management. Can you manage the business and also serve your customers?
Financial. Can you make money?
Consider reviewing the startup information provided by the IRS. Help from experienced mentors is free through organizations such as SCORE, an organization of volunteer business mentors who provide specific advice and resources to newly created and growing businesses on a no-cost basis. There are, of course, many other organizations such as your local chamber of commerce, which can also provide mentoring and guidance.
Cost: 0 dollars.
2. Have a web identity
Everyone is on the web. Customers access and search the Internet for services and sellers through searches. Suppliers and banks look at your website for credibility and presence.
But your web identity is more than a website. It starts with an email address with your business name such as Jim@legalconsultants.xxx and a domain name such as legalconsultants.xxx.
A few years ago, creating a website was expensive and required outside technical consultants. Now it is quick and easy to do it yourself. Consider companies such as GoDaddy.com to choose a domain name, email address, web hosting, and website design. Companies such as GoDaddy will even do your online billing.
Cost: 300 dollars per year.
3. Consider office space
© leonidkos - Adobe Stock
Even if 52 percent of all small businesses are home-based, that does not mean you need to look like you work from your home. Customers looking at an office address can usually tell the difference between a professional address and a home address. Also, if you’re meeting with clients, you’ll project a more professional image if you meet in an office setting versus a suburban home. For this reason, consider signing up with a fractional executive office service or co-working space.
An added bonus of executive office space is you will be working near other entrepreneurs. Hanging out at Starbucks between meetings will be a thing of the past.
Cost: Varies
4. Business cards
Believe me, you will need them. A paper carryover from the past, they are still widely used and critical to a new business. There are many online business card services, but companies such Canva, Moo, and Vistaprint are all solid options.
Cost: 80 dollars for 200 cards
5. Social Media
Depending on your type of business, you will want a social media presence. LinkedIn, with more than 380 million members, is regarded as the business site for connecting with other businesspeople and offers excellent posting features for articles and blogs. Facebook is more of a social friends site than a business-focused site, but it’s also an excellent tool for “getting your word out” to your friends and customers. Both LinkedIn and Facebook allow you to set up a commercial page for your new business. Depending on your line of business, you may also want to investigate using Instagram and TikTok.
Cost: Free
TOTAL COST: $380 dollars + office space or coworking costs
To be a successful entrepreneur, you need to provide a service or product that customers want to buy, that you can provide at a profit. And of course, it’s not all about the money—it takes very hard work and long hours. But with a bit of planning and a little bit of money, you can beat the odds and create and grow a successful business.
