Business start-up: 10 vital things to do

Shelves of volumes have been written about business start-ups. But here are ten things to do that underscore the areas that are among the most important.

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1) Make a business plan. If you seek financing from a bank or anywhere else, you’ll have to provide a comprehensive business plan. But it’s vital that you write the plan even if you don’t need it to generate start-up capital. It will force you to think through the details of every element in your new enterprise, to identify weaknesses you would have overlooked, and to foresee problems before they happen.

Make certain the section on finances isn’t just pie in the sky; it must include realistic income and expense projections for at least the first 2 years. You may also want to get a how-to-do-it business plan workbook or computer program.

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2) Start with sufficient money. Undercapitalization is the most common and pervasive cause of failure in new businesses. Don’t underestimate your need for money. Be aware that it may take an extended period before your business shows its first profit; maybe 6 months, maybe a year, possibly even longer. Make certain you have enough capital in reserve to support yourself and your family while your business is developing.

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3) Know your competition. Understand who else is competing for the same customers you’re after. Know how big and important your competitors are in the market. Find out about their products and services, marketing strategies, pricing, strengths, and weaknesses. Compete successfully by being strong where they are weak. Continually improve on what they have to offer.

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4) Focus your business. You can’t be all things to all people. You must have a clear sense of the market you will be serving, and the products and services they will buy. Identify who your prospective customers are, where they live, how to reach them, and how much they can afford to spend. Determine what they’re not getting from your competitors. Then zero in on your target market.

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5) Cater to your customers. Ours is an era of consumerism. In business today, customers are the kings and queens. The businesses that succeed are the ones that go to extraordinary lengths to keep their customers happy. No matter what you sell, you are really in the business of satisfying clients. Remember, without them you have no business.

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6) Build a customer list, and use it to communicate with customers often. Existing customers are your best source of business. Your client base generates repeat sales and valuable referral sales, both of which cost you far less than getting new business from scratch. Your house customer list can be an immensely valuable asset. Use it often to remind clients who you are and the benefits you offer them.

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7) Stress marketing. Your professional knowledge and skills alone are unlikely to bring crowds of clients through your door. Your prospects have to know who you are, where you are, and why you’re so good. Get the word out. Don’t be afraid to market your business.

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8 ) Hire winners. Indifferent, uncommunicative people on your staff make a poor impression on your customers. Professional experience is valuable, but it counts for little without genuine friendliness and credibility. The two most important qualities to look for in new employees are enthusiasm and strength of character. You can teach them the rest.

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9) Get a first-rate attorney. A respected lawyer is an important resource for your business, especially when you’re just starting out and haven’t yet built a reputation of your own. Don’t hire a second-rate attorney just because he or she is cheap. Make certain your business is built on sound legal advice, with safeguards to protect you if you run into problems or when you decide to sell your business.

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10) Re-evaluate everything continually. Businesses that say, “That’s the way we’ve always done it,” and “If it ain’t broke, don’t fix it,” are bound to begin slipping sooner or later. Your profession changes, technology changes, customers change, competition changes, and the times change. Don’t get left in the dust because you refuse to change, too. If you wait until it’s broke, it may be too late to fix it.

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