Many people dream of being their own boss and setting their own hours. However, while this prospect looks attractive, starting your own business is risky. According to Forbes, while 80 percent of entrepreneurs starting a business will survive their first year in business, beyond that, the survival rate falls sharply to roughly 51 percent at the five year mark. Although you do not need any formal training to start your own business, you must be a self-starter who can multi-task. And regardless whether you’re offering products or a specific service, you’ll need some essential skills to increase the chances of your business becoming successful.
Perform Effective Market Research
To succeed, your idea should be original, and if you offer services, you’ll need to offer something that sets you apart from the competition. Your job as an entrepreneur is to find a void within the community and to fill it with your products or services. To determine what that void is, you’ll need to perform effective market research to learn what your community is seeking.
Manage Your Finances
You’ve heard the saying, “Money makes the world go around.” This is especially true in the business world. While it’s true you need to spend money to make money, you don’t want to overspend and end up in a financial crisis. Entrepreneurs are busy people. They work long hours to ensure money is coming into the business. In fact, 19 percent of business owners work 60 or more hours per week. If you find yourself working long hours, it may be in the business’s best interests to outsource taking care of your business finances.
Perform a SWOT Analysis
As a small business owner within the first year of operation, you’ll need to define goals. You should map out a plan by month or even quarterly. A detailed SWOT (strengths, weaknesses, opportunities, threats) analysis will help you plan out your business strategy, including the staff needed, funding, marketing, and any other business-related issue.
Take Advantage of Technology
Many business owners have some technological knowledge. You don’t even have to be an expert to understand the basics of technology. But, you must realize that technology is everywhere and there’s no avoiding it. If you’re comfortable with technology, then you should be comfortable with making your online presence known. Visibility on the internet will increase your business success. Despite this, 60 percent of small businesses have no online presence. However, if your customers can’t find you online, then your only chance of getting new and repeat business is by word of mouth.
Have a Stellar Work Ethic
If there is one thing an entrepreneur is not, it’s lazy. To start and operate a business, you must be motivated and go to work every day. You have to be willing to work long hours even when there’s seemingly no rate of return on the investment you’ve made in time. You should delegate tasks to employees where you can so you can focus on the operation of your business and bringing in the money.
Business Sense is Essential
Many entrepreneurs have little to no college or formal training. In fact, the largest segment of business owners have no education beyond high school at 33 percent. Therefore, it should be noted that while a college education can certainly prepare you for some of the unique challenges you will face as a business owner, you shouldn’t let the amount of education you have, or don’t have, be a barrier to entering the world of business ownership. What you do need to have though is a keen business sense. Continually educate yourself as to what is going on locally, nationally, and internationally to keep abreast of business trends and the economy. Obtaining this necessary knowledge can be achieved through:
- Formal Education
- Seminars and Workshops
- Trade Shows
- Professional Groups
Keeping up with the latest economic trends will help you understand how different components of a business work together and how you can be successful. If you’re interested in starting your own business, you can gain valuable experience through working with a mentor. An experienced mentor can help you weigh up the pros and cons of business decisions and assist you in analyzing different business trends. In addition to a mentor, you can also read and do your own research. Take a look at the biographies of some successful leaders to gain an insight into their thinking and business-making decisions. Reading about the challenges, successes, and failures these individuals faced will give you some insights into what factors contribute to good and bad decision-making and may help you avoid some of the business pitfalls that could disrupt your business and risk your success.