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23 Tips for New Entrepreneurs to Get Your Business Underway

23 Tips for New Entrepreneurs to Get Your Business Underway

Being your own boss, working from home, financial freedom, these all the things that motivate people to become entrepreneurs.

But the fact is, while a lot of people dream about having all of these things, most will never take even the first steps to become an entrepreneur, why not? For a lot of us, coming up with a “million dollar idea” is easy, implementing it is not.

Knowing how to get your business started is the hardest part. There are a lot of things to think about. Is my idea even good enough? How do I get financing? How am I going to market the business. Do I even have the time to start a business? And it seems like a million more questions come flooding through your mind.

Because all of these things are legitimate concerns and many don’t have a clear cut “right” answer, many people end up doing nothing.

Today, we are going to talk about the most common issues new entrepreneurs face and how to overcome them. Let’s take a look at the 23 tips for new entrepreneurs:

1. Evaluate Your Idea

In any list of tips for entrepreneurs, this should always rank as number one. Do you have a business idea that will work? Good business ideas will do at least one of the following.

A. Make a person’s life easier/better – The home computer has made communication much easier, especially over long distances.

B. Save people time or money – The advent of the washing machine saved countless hours of hand washing clothes item by item.

C. Adds value to an existing product – The value of home computers really increased with the development of software. Word processors, accounting and tax software, spreadsheets etc.

2. Evaluate Yourself

This can be difficult, especially because it requires you to be completely honest. The up side is that if you are honest it’s invaluable knowledge to have.

What type of a person are you? Are you a “big picture” person or a “detail orientated” person. Are you good with accounting and numbers or would you rather be out meeting customers and selling products?

Understanding your strengths and weaknesses will tell you how you need to allocate resources.

3. Do Market Research

You not only need to know your product or service inside and out, but you also need to know your customer inside and out.

Who are you marketing to? What is the benefit that you or your product is giving them? What is there biggest complaint about their current product or service? Does yours fix that problem? Just how big is the market for your product or service?

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Through market research, you should be able to answer all of these questions.

4. Have a Business Plan

A lot of new entrepreneurs get stuck with this one because they don’t know how to do it. The important thing here is to not get to bogged down in the details.

When you are first starting out, your funding sources are probably going to be friends, family and maybe a bank that does SBA loans. They are not expecting anything to elaborate, but you must have a well thought-out business plan to show them. Here’s a great article on how to write a business plan.

5. Think About Branding

Don’t just think about branding as a logo or catch-phrase. Branding is the way you will differentiate yourself from your competition. Branding is what makes you or your product unique. Ultimately, branding is why customers will choose your products over the competition.

No matter how you decide to brand yourself, it’s going to take time and consistency, so get started right away!

6. Secure a Domain for Your Website

In today’s world, having a website is a must. It really doesn’t matter what type of business you have, you need a good website.

Securing your domain name, while it’s a simple process, it’s not uncommon to find that your first choices are taken.

For example, “Donny’s Lawn Service” is probably already taken. Don’t get discouraged, just get creative. You might try “Lawn Maintenance by Donny” or “Donny’s Executive Lawn Service”, “Landscaping by Donny”, “Donny’s California Lawn Service”.

Whatever you choose, think of your website as an extension of your branding efforts.

7. Get Your Social Media Set Up

Much like a website, having a social media presence is a must in today’s world. Facebook, Twitter, Instagram, Pinterest are all valuable places for you to market your business and engage with customers.

Securing your social media presence now to get a jump start on your launch.

8. Decide on a Legal Structure

Is your business a Sole Proprietorship, LLC, Partnership, Corporation? What’s the difference? All of these entities have their own strengths and weaknesses as well as tax consequences. This is where professional advice is a must.

Consult your lawyer and tax adviser as to the best option for your situation.

9. Register with the Government

Exactly what you need to do will depend on what type of business you have. If you have a retail store, you will normally need a business license and sales tax license. If you do personal services such as hair or nail salons, your will need to register with the local health department.

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Depending on the business structure you have an EIN (Employer Identification Number) maybe required. You can find a complete list of federal and state licensing requirements on the SBA’s website.

10. Make Financial Projections

Remember that research we talked about earlier? Here’s where it comes in handy. You’ll want to have a good idea of exactly what your startup costs will be.

Things like inventory, marketing, rent, utilities should all be in there, but also make sure that you are accounting for things like a (modest) salary for yourself, you need to be able to live while you are getting started.

Insurance, legal and professional fees, questions and concerns that require expert advice are bound to come up in the first year of the business.

11. Develop a Marketing Plan

The days when “if you build a better mouse trap the world will beat a path to your door” are over. In today’s world, marketing is what determines the success of a business.

First you’ll need to define your market, are you selling something to a locally (Boutique, Hair / Nail Salon, Lawn Service) or are you going to be selling nationally or even internationally (Software, Electronics, Consulting Services)?

Your marketing strategy will depend on these and other factors.

12. Set up a Sales Plan

While a marketing plan is focused on how to get people interested in your product, the sales plan’s focus is about turning that interest into revenue.

The type of sales plan you develop should be directly related to what you are marketing. If it’s a brand new never seen before product, having a physical sales force that can go out and show the product demonstrating how it works might be useful.

On the other hand, if it’s software or a consulting service it’s probably much more efficient to build a website with a good sales funnel.

13. Start Securing Funding

Once you have the financial projections and you know how much you’ll need, you can start looking for funding.

So how much funding will you need? If your financial projections show that you will need $40,000 the first year, you should secure funding in the range of $50,000 – $55,000. And where should you get this funding, the very first place should be through your own resources.

Now, you don’t need to put every last penny you have into it, but going to others for funding without any “skin in the game” on your part will not inspire confidence.

Other funding sources can include, SBA loans through banks, successful business people looking to invest and even crowd funding. Oh and don’t forget friends and family!

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14. Set up an Accounting System

You can either do this in house, or by hiring an outside firm. Keep in mind that your accounting will need to be kept up to date and it can be time consuming.

You maybe better off spending your time growing the business and letting an outside firm handle this aspect of the business.

15. Find a Good Insurance Broker

Getting the right insurance is a must. Without the right insurance, you are not only risking the business itself, but potentially all of your personal assets too.

Besides, your banks and investors wont even consider investing if you don’t have the proper insurance. Most businesses have a trade association, this is a great resource for your insurance needs.

16. Start Putting Together a Team

One of the most important tips for entrepreneurs is to assemble the right team. A lot of times founders will try to be a “Jack of all trades” and do everything. This is a mistake, a good rule of thumb is that entrepreneurs are ‘big picture” and employee are “specialists”.

17. Consider Compensation Packages for Key Employees

One thing that almost all start ups have in common is a lack of money. You want to attract the best employees but you are competing with more established companies that can often times pay more.

Consider some creative options when hiring key employees. For instance, you may not be able to offer a company car, but you may be able to pay for mileage. You may not be able to match a salary, but consider giving key employees a stake in the company. There are always creative ways around problems.

18. Setup a Work Space

It doesn’t matter if you are going to be working by yourself at home or if you’ll have several employees. You need a professional work space.

If that involves leasing office space, you’ll most likely need a security deposit, first months rent as well as deposits and fees for utilities.

If you are working out of your home, set aside a area that is dedicated for work. It should be a place that you can work uninterrupted and is quiet enough that you can make professional business calls without dogs barking and babies crying.

19. Start Getting the (Pre-Launch) Word Out

The launch of your start up should not come as a surprise. You need to be building your brand and creating a presence in the marketplace before you launch.

Start joining discussion boards devoted to your industry or profession. Offer tips and suggestions on your social media pages to get likes and followers. All of these things will create excitement and anticipation for your official launch.

20. Get Feedback

This can be included in your pre-launch activities. Offer a prototype, or give a description of the service and ask for feedback.

Don’t get upset or discouraged by negative comments. What you are looking for is a pattern. What aspects of your product or service get the most positive and negative reviews? Use this information to make adjustments to the product / service, or it just change the way you present (market) your product / service.

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21. Do a “Soft Opening”

A soft opening is basically just a practice run for your grand opening.

The soft opening is where you will start getting your very first “word of mouth” advertising. It’s also where you will work out the kinks in the system that inevitably occur.

22. Launch Your Grand Opening

This is the day you’ve been waiting for, everything is set up, you’ve worked out any issues during the soft opening and now your ready to go.

The grand opening should be a big event with a lot of pre-planning and social media hype.

Notify trade associations, Facebook groups and discussion boards. Offer “door buster” deals to the first X number of people who sign up or purchase a product.

23. Constantly Evaluate and Adjust

Remember when we talked about doing all that planning? Well now you will need to evaluate those plans and make adjustments as needed.

There’s no such thing as a straight line to success in business, and even the best laid plans hit road bumps.

Your job as a manager is to recognize the bumps before they damage the car. Remember that it’s always better to catch problems too early than too late.

Evaluate, Adjust, Monitor, Repeat.

The Bottom Line

Starting a new business can be one of the scariest, stressful, agonizing things you can do in life. But it also can be one of the most rewarding and fulfilling things you’ll ever do.

I like to say that businesses are like marriages, bad ones are awful, but good ones are priceless. And just like a marriage, the more you work at it the better it gets.

So here’s to a solid foundation to both your relationships and business ventures!

Featured photo credit: rawpixel via unsplash.com

More by this author

David Carpenter

Lifelong entrepreneur and business owner helping others to realize the American Dream of business ownership

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Last Updated on September 24, 2020

How to Take Advantage of the 80 20 Rule to Succeed in Life

How to Take Advantage of the 80 20 Rule to Succeed in Life

The world of productivity has several hacks or tricks to help you manage your time: to-do lists, the Pomodoro Technique, Parkinson’s Law… All of these strategies are great strategies in their own way, but one strategy stands above all the others: the 80 20 rule.

This particular strategy has been used the most and is regarded as the most helpful in developing time management and other concepts in life.

But what’s so special about this rule? How does it give you success and how do you use it? Let’s explore the specifics.

What Is the 80 20 Rule?

Many people regard this rule as the 80 20 rule, but it has a proper name: the Pareto Principle[1]. The principle was named after its founder,  the Italian economist Vilfredo Pareto, in 1895. Pareto noticed that people in society were divided into two categories:

  • The “vital few,” which consisted of the top 20 percent with respect to money and influence.
  • The “trivial many,” otherwise known as the bottom 80 percent.

As he researched this further, he came to discover that this divide didn’t apply only to money and influence, but other areas, too. Virtually all economic activity was subject to his previous observation.

He observed that 80% of Italy’s wealth at the time was controlled by only 20% of the population.

Since the development of this rule, humankind has used this particular ratio in all kinds of situations. Even if the ratio isn’t always exact, we see this rule applied in many industries and in life. Examples are:

  • 20% of sales reps will generate 80% of your total sales.
  • 20% of customers account for 80% of total profits.
  • 80% of the revenue will stem from 20% of the workers.

Either way, I’m sure you can piece together why people call this rule the 80 20 rule over Pareto’s Principle[2].

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Make Your Life and Your Business More Efficient with the 80-20 Rule - Salesforce Canada Blog

    In terms of how this particular rule will be able to work for you, it’s a matter of applying this rule to how you spend your time. For us to see success, the goal is simple.

    We need to set it up in such a way that 20% of our input is responsible for 80% of our results.

    Another way to think about it is we use 20% of our time on activities that give us 80% of our results in a given area of life.

    How Does the 80 20 Rule Work?

    To best explain this, let’s visualize a bit.

    In an ideal world:

    • Every employee would contribute the same amount of effort to work.
    • Every feature that’s released for an app or product would be equally loved by users.
    • Each business idea you come up with would be a hit.

    In that scenario, planning would be a breeze. There wouldn’t be any need to analyze anything so long as you put in the effort.

    But that’s not reality.

    Yes, the effort is certainly an element, but what the 80 20 principle states is that everything is unequal. Invest in 10 start-up companies, and you’ll find only a few will pass year two and make it big. You’re in a team of five, and there’ll be one person doing more work than others.

    We wish our lives were always one-for-one in terms of input and output, but that’s simply not true. Understanding this is key to understanding how the 80 20 rule really works.

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    So how does it really work?

    It’s a matter of focusing on what’s giving you the most in your life for little of your time.

    Going back to the few examples I’ve presented above, consider this:

    • If two start-ups you invested in are making it big, focus on having a more direct hand, and see if you can help them prosper more.
    • If 20% of sales reps are giving you 80% of your sales, focus on rewarding those and keeping their spirits high and motivated.

    These scenarios can go on and on, but the idea is to place your efforts on the 20% that is actually making the difference in your life. Another term that’s good to know is the diminishing marginal utility[3].

    Pareto didn’t come up with this one, but the law goes as follows: each extra hour of effort or worker will add less “oomph” to your finished results.

    Eventually, you’ll hit a point where you will spend a lot of time on small and unimportant details, similar to perfectionism.

    So before hitting that point, you want to have a laser focus on the most important details, from family and relationships to your work or business. Prioritize the activities that are going to move you forward the most, and be wary of adding extra time, effort, or more hands into those particular tasks moving forward.

    How to Take Advantage of the 80 20 Rule

    So now that you have an understanding of the 80 20 rule and how it works, what is the best way to take advantage of it?

    Depending on where you are applying this rule, this can be used in all kinds of fashions.

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    For example, you can apply this rule to goal setting, as demonstrated by Brian Tracy in this video:

    Or you can apply it in terms of general productivity as explained in this article: What Is the 80 20 Rule (And How to Use It to Boost Productivity)

    The core of this rule is that it forces us to ask ourselves the questions we wouldn’t consider otherwise. It helps us to place our focus in the right places with regards to all things in life.

    In short, the 80 20 rule places us in charge of our lives and helps us set out on our goals and dreams. With this in mind, here are some things you can consider concerning this rule.

    1. Focus on Your Big Tasks First

    While this is the essence of the 80 20 rule, it’s still worth mentioning. Why? Because so many of us feel intimidated by the biggest task. We instinctively avoid it and opt for smaller tasks first.

    We think that if we complete enough small tasks that we will feel motivated to finish that really big one later. But that’s really false hope at work.

    Once we finish off a lot of small tasks, we either feel drained, or we tell ourselves we’ll do this the next day.

    Instead of doing all that, bite the bullet and tackle the largest task first.

    If you need help with prioritization, check out this article.

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    I argue this by challenging you to ask yourself this one question:

    “Is the task I’m about to do the top 20 percent of my activities or the bottom 80 percent?”

    I’m sure you’ve seen time and again you or other workers spending a lot of time on one task for most of the day. In those kinds of grinds, you’re barely getting ahead and have next to nothing to show for it. That’s because they’re putting all their attention on work that’s in the 80 percent.

    It’s normally the big tasks that are part of the 20 percent.

    Another way to think about this is that everything we do starts a habit. If every day we spend our energy on low-value tasks, we will always prioritize those.

    2. Stretch This Into Personal Life

    While I’ve been talking about business and setting goals, remember you can use this in other areas of your life, too.

    Take your personal life and ask yourself some of these questions:

    • How much TV do you watch on a regular basis? What sort of shows are you legitimately into? These questions can help you in recognizing what shows you are watching purely for consumption. By applying the 80 20 rule, you can cut back on Netflix, TV, or YouTube video consumption and prioritize other areas of your life.
    • What does your wardrobe look like in terms of colors? Are there specific colors that you like? Knowing what you wear most times will help you in sorting out your wardrobe significantly. It also saves you time to come up with what to wear every morning.
    • How many newsletters do you actually read? This question can help you in figuring out which newsletters to unsubscribe to and can clear up a lot of space in your inbox. It can also relieve pressure from having to check your emails constantly.
    • How much time do you spend on your phone every day? How much of that time is actually doing something meaningful? These questions can help you in clearing out various apps that aren’t helping you with your goals. In fact, this can curb the need to check your phone constantly.

    Final Thoughts

    The 80 20 rule is the productivity hack that many of us need, and for good reason. As you can tell, it’ll help you to focus and prioritize the more important aspects of your life.

    Not only that, but it’ll maximize those outputs at the same time and ensure you’re not spending too much time working on them. All you need to do is start asking questions and taking action.

    More Techniques to Help You Succeed in Life

    Featured photo credit: Austin Distel via unsplash.com

    Reference

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