A lot of people dream of running a business. They desire the freedom of not working from 9 to 5 every day in a confined office, and the possibility of endless profit are some of the major motivators to own a business. However, according to the Bureau of Labor Statistics, 20% of new businesses fail during the first two years and only a quarter of them survive for 15 years or more. Most people want to be their own bosses, but they have no idea of the hard work, money, knowledge, and patience they need to have before their new ventures can earn profits or break even.
Below are four key factors you need to consider before starting a business to give it a better chance of succeeding.
1. A business idea
You can’t develop a successful business without a great business idea. A great and practical idea is key if your business is to thrive. Also, your business needs to be unique to stand out. With that being said, you may have a great idea, but it may not be unique. There may be hundreds of businesses similar to the one you wish to start. However, you can make it stand out by offering better products and services. The bottom line is to find gaps that you can fill.
2. Location
Location is crucial for a startup. Find a location where your business can be seen by the target market. If you want to venture into the retail business, an accessible and well-populated location is the most appropriate.
If your business is a manufacturing unit, select a location where you save on money transportation, electricity, water, and taxes. Also, ensure you can easily get manpower and raw materials in your chosen location.
For a niche product, you need to settle in a location where all your competitors are located. For instance, if you want to start a screen printing firm, you may want to settle where a lot of screen printing firms have set their shops.
For an office space, it should be in a location where your clients can easily get in and out—a place with ample parking, hotels, and easy access to public transport. The most important thing is to find a location that is within your budget, has room for future expansion, and complements your business in the best possible way. A tenant representation services company can save you the hassle of finding a suitable and affordable location for your business.
3. Competition
Without a proper competitor analysis, your business won’t survive. You need to know what your competitors are doing. Studying their strategies helps you to come up with improved strategies.
4. Capital
You need money to start and run a business. You need to estimate the startup costs – the amount of money you need to start and run your business successfully. When taking steps to finance your business, make sure it is enough to take you through the startup phase.
Endnote
A big dream is not the only thing you need to succeed in entrepreneurship. You need to have a great business idea, analyze your competitors, have enough startup capital, and find a convenient location.