Planning a business startup is an exciting time. However, there will be little time for you to feel the excitement of what you are doing; all of your focus needs to be on making your business startup a success.
What should your focus areas be?
Ask anyone to define business startup; we would bet most people would tell you it specifically relates to getting a business up and running. The entrepreneur who takes this same outlook, however, is more likely to see their business crumble at an early stage.
How far should you plan when starting a business? Does the percentage failure rate of businesses in each year indicate where the benchmark should lie? The first table indicates the failure rate by year; the second the total number of failures from a cross-section of startup businesses over a ten-year period.
As we might expect, a high number (25%) of businesses fail within the first year of operation. This number drops to 11% in year two, before gradually falling steadily as the years’ progress. Based on these numbers, a startup might think that, if they get through year one, they have a great chance of success.
While featuring the same data, this chart gives a different interpretation. We now see that 71% of startups will not make it past year ten.
What is the best mid to long-term objective for a business startup? Getting through year one might be the main aim, but with only a 29% likelihood of still being around in a decade, is starting a business really worth it.
Of course, we know that it is, and we would expect you, as an entrepreneur, would believe the same thing.
Be realistic; no business startup ever laid out a ten year plan. This might be something you do as your proceed, but doing it from the get-go would probably mean you take your eye off the here and now.
Clearly, you need a strong, detailed plan for year one, so that you know what you are doing at all stages. We would suggest having a loose idea of years two and three, so that you can start to produce something more clear-cut once your business is off the ground and you have an idea of how much success you are going to achieve.
What to Plan For
There are dozens of aspects you will have to plan for, some general and others specific to your industry, depending on what your business is doing.
Three of the biggest areas for consideration will always be your target market, the technology you use, and the people you employ.
Who are Your Customers?
What product are you selling or service are you providing, and who do you want to buy it? Have you identified an opportunity in the market for something unique, or are you getting involved with something that is growing and is easy for anybody to exploit?
You have to know who will want your product. Perhaps more importantly, you will want to discover how long they are going to be interested in what you do. If you are an entrepreneur jumping into an expanding market, at what point will the market saturate and the opportunities to do business start to reduce? Does your business plan give you enough time to become a major player in the industry so that when the market does saturate, you are still able to operate profitably?
Those are all customer related questions you will need to answer prior to getting started. One final big question will be how you will reach your customers. That is where our next focus area comes in.
Technology in Business
We are going to skip right past things like your mobile device; we are sure you have taken care of that already!
In the 21st century, technology, and in particular the internet has a key role to play in any business looking to market themselves and bring in revenue. For a startup, this can be even more crucial, as the internet is the one big opportunity you have to cut through the noise and make a name for yourself.
The business without a website is like a business without a plan; it is not going anywhere. It does not matter what your industry is or who your target audience is, you have to have a website.
Do not listen to people who tell you if your target market is the elderly that there is no point in having a website. Remember that relatives and care providers will use the internet to search for services. Keep these golden rules in mind for putting together your business website.
- Know who you are. As a startup, you only need loads of pages if you are an ecommerce provider.
- Find the best web hosting services provider before you do anything else. Companies such as Jaguar PC are excellent for providing practical, affordable services whatever your needs.
- Pay for a professional design if possible. Keep in mind throughout the process that it is better to spend on a quality product that will pay for itself in time, rather than for a poor one that will hinder your chances to drive revenues.
- Consider keeping some finances aside for basic online advertising; whether this is SEO, PPC, or affiliate marketing, they can all help to get your name out there
If you get your website right, then it will become the heartbeat of your business and help to drive online sales or bring people to your physical location. It might even be worth putting your website together before you start your business, so you are ready to go from day one.
A great website will only need minor updating and development as your business evolves, meaning you can do it well, once, and then focus on the other areas of your operation.
If your business grows as you plan and hope it does, then there will likely come a time when you need to start taking on employees. Ironically, business growth is often one of the things that can stop a business from achieving its full potential if you do not manage it correctly.
Project when you are likely to need to start bringing employees into your business as you start to grow. This might be people that you employ outright, or freelancers to whom you can outsource work as and when it becomes available. Plan so that you are not caught short and find yourself trying to do everything yourself, and thus having a negative effect on the service levels you give to customers.
Enjoying Your Business
The more you plan and know exactly where your business is going, the more likely you will be able to enjoy what you do. Make sure your startup only becomes a statistic in a good way, and is one of the 50% to survive beyond year four, and one of the 29% to do so for more than ten years.
- License: Image author owned
- License: Image author owned
Robert is a business startup consultant who advises entrepreneurs on everything from choosing web hosting services, such as VPS hosting, to how to plan for recruiting employees and focusing on a specific market.