Top 5 Questions to Ask Yourself Before Starting a Business
Starting a business is exciting... and scary. One of the best ways to boost the excitement and shrink the fear is by taking the time to make sure you are fully prepared for what's ahead.
While it's difficult to plan for every possibility and challenge that may occur, you can get yourself on the path to success by considering these five questions before jumping in with both feet.
Have I set goals and do I have a plan for reaching them?
As the proverb says, "He who fails to plan, plans to fail," and this is especially true when starting a business. Without a clear idea of where you want to go and how you plan to get there, you may find yourself stumbling through the stages of starting a business and facing unwanted stress and frustration.
One of the most important steps is setting goals that outline what you want to accomplish in the short term (1 month, 3 months, 6 months, etc.), as well as over the long term (2 years, 5 years, etc.). Once you have created your goals, it's time to make sure you have a plan for your business that will guide you along the way. It's also helpful to understand your motivation for starting a business in the first place.
Will I be able to follow my plan without breaking any laws or regulations?
There are a number of legalities that you should consider when starting a business. Here is a list of some of the legal areas you should explore:
- Deciding on the structure of your business (sole proprietorship, partnership, corporation, limited liability company)
- Registering a business name
- Obtaining necessary licenses and permits
- Planning for business taxes
Have I fully considered the financial implications of starting a business?
Money is a major concern when you start a business, especially if you will be leaving behind a steady paycheck and if your business has significant start-up expenses.
Some business financing options to consider to ease the financial transition include starting your business on the side while continuing to work full-time, working a part-time job until your business becomes established, waiting to start your business until you have saved up a financial reserve, and borrowing the necessary funds to bridge the gap.
Is my support network in place?
We accomplish very little in life completely autonomously, and the same is true in business. Even if you plan to be a sole proprietor, you can benefit tremendously from creating an external support system to keep you on track.
Your support network may include family, friends, colleagues, a mentor, a coach, and anyone else who can help you navigate roadblocks. When you have an effective support system in place, you will find that you have a cheerleader, consultant, moral support and even a devil's advocate when necessary.
Do I have what it takes to make it as a business owner?
Being a successful business owner requires a unique mix of personality and small business character traits. While there isn't a standard formula that makes one type of person more successful than another, some entrepreneur-friendly personality traits that can ease the process of getting started as a business owner include passion, drive, dedication and self-discipline. And it doesn't hurt to be an effective communicator and someone who is willing to take measured risks.