Setting Up A New Business – What You Need To Know

Setting up a business either on your own or as a partnership can be a very exciting time. When setting up a new business, whether this is an online-based shop or a bricks and mortar business, there are things you need to know and things that you have to have in place, such as insurance to customer care policies. So, where do you start? Well ideally, you will start by narrowing down exactly what you will be selling or making (if you haven’t done so already). Knowing your product list and base before you get started is beneficial to save you time, money, and hassle further down the line. As well this, there are other things you should get sorted. Here’s a look at the big questions you need to answer.

Who are your customers?

It is essential before launching your business or trying to sell anything that you know who your customers are. Where do they live, and what is their socio-economic profile? for example, are they dinkies (dual income, no kids), or are they single working professionals? You must know exactly who your target audience is, or else you will not be able to reach them effectively. Establishing your target audience will allow you to tailor any marketing and advertising you need to do to get their attention.

Who are your competitors?

Unless you have developed a completely new product, you will always have direct, or indirect competition. Competition for custom doesn’t always have to be seen as negative. If you have competitors, it shows you that there is a ready and waiting market for you to get a share of. Look at how your competitors trade and act – what do they do successfully, and what are they missing the mark on. For a start get a good feel and idea of how well they are doing, and if they are pleasing customers by reading their online reviews. Identifying what you can do to get the better of them will really help your business.

Do you have a business plan?

If you do not have a business plan written out already, then you will need to start working on one straight away. Not having a plan is going to set you up straight for failure, as you will not have any direction, knowledge, or base on to start your new business on. A business plan provides you with a solid foundation with which you can work and build upon, it can be amended at any time and is also useful to keep for reference. A good plan contains everything from how much you will make in profit per item you sell, to who your target audience (customers) are and how you will reach them. If you don’t have a business plan to refer to, you are starting off on the back foot.

Do you need trading licenses?

If you are trading from a physical location or busy shopping districts, you are most likely going to need trading licenses. Contact your local government office or business development officer within your state to find out what you need to have in place to get legally up and running.

Have you got the right premises?

Most likely your business will need a premises to trade from, whether this is a base to store equipment or stock, or it is a physical storefront for customers to visit. You have to decide how much you can afford to spend on a monthly or annual basis on rent. Don’t forget to include any overhead running costs such as electricity, heating, and water. When looking for locations, especially if you are opening up for customers to visit, you will need to consider how accessible the site is. For example, can it only be reached by car, if so is there adequate and safe parking for customers? Is it on a bus route, or can customers reach you by simply walking to your location? All these factors will help influence how successful your business is.

Do you have the right equipment?

If you are going to be moving products around in a warehouse, or between stockists and suppliers, you are going to need to factor in the purchase or hire or things such as cherry pickers, pallets, heavy duty casters, safety equipment such as harnesses, and high visibility clothing, to keep yourself and any employees you have safe.

What insurance do you need?

If you have a premises you will need adequate insurance to ensure anything and everything of value is insured. Good insurance will also cover and protect you from accidental damage, arson, and burglaries. If you hire employees, you will also need insurance to cover them for any incidents or accidents they may experience while working for you. Do not underestimate how important adequate insurance is. It is cheaper to purchase insurance from the outset than it is to pay out if either you need to claim or if somebody should make a claim against you. As with everything, shop around for the best insurance provider. Get at least three claims from each provider, and don’t feel that you have to take the insurance that your business bank might be pushing you into.

Have you got the best suppliers possible?

From stationery to office furniture and not forgetting those filing cabinets, you will need lots of supplies to furnish premises, and so you will need lots of suppliers to assist you in getting your business off the ground. Whether you are ordering your supplies online or offline, always check lead and delivery times to ensure you can get the supplies you need, even at short notice.

Have you created a stockists?

Where will you be selling your products? Whether you are making or manufacturing them yourself, you need to know where you are going to target. For example, are you targeting high street locations or boutiques’, or are you focusing solely on the online market. You can establish where your products will be successful and sell well by conducting market research. Observing where customers buy, what they purchase, and how much they spend on average on each transaction will allow you to start putting together a sales forecast, which will include the figures you have found out through your research.

When you set up your business, don’t forget to get a suitable business bank account which will allow you to keep track of your everyday expenses, your incomings and outgoings.

Running a business can be hard work, but the potential returns and business experience you will gain make everything you do totally worth it.