Have you been reading all the articles about how to start a business on the side? How Can You Grow Your Business On The Side Using Top Outsourcing Corporations or Businesses? How Do You Turn a Business Opportunity into Reality? Have you always wanted to be your boss, sell your great ideas, and make your dreams come true? Well, it is something that can become a reality, and it does for many, but much more people fail if they start with the wrong idea of what it takes to start out in business for yourself: This is our first of a two-part look at how to hustle your side business, and what steps you need to take to make a success out of any business.
Why You Should Start a Side Business
Side businesses are a good idea if you want to test your money-making idea, or just have to continue to work your 9-5 job to pay bills. A lot of entrepreneurs also have many side businesses on the go, with multiple revenue streams. It’s always a good idea to start off something on the side, or part-time if you need the security of your other incomes, but want to take a leap into a new venture.
Some Things to Think About Before You Start
Assumptions are dangerous.
Most people do not even realize that many of their decisions are assumptions. People form partnerships, thinking that both partners are making the same commitment and have the same criteria for success. Wrong. Susie may know that a gift shop is not just a nine to five proposition, while her best friend and new partner Jane may still be planning to go away for two weeks at Christmas like she has done every year.
If you have been considering going out yourself, then you may have a few ideas. Consider more than the classic question, “what do I like doing?” This is important to consider, but you need to evaluate yourself the next series of questions. If you have a great idea for a product, ask yourself who is going to buy this product – online, in your store, through a distributor, a local sales force or at Walmart? How will you get your product produced? Where will your product be stored?
Once you have a business type or better yet, a specific niche selected, make a plan for the operational side of the business. How will your message be conveyed and how will you generate new leads each month? After you have produced some interest, who will turn your prospects into paying customers? Will you have an online presence, brick and mortar physical location, or both? Take into account location, cost and overhead. If you aren’t the best at any of these fields, consider outsourcing some of these tasks or responsibilities.
A good product is not enough.
People also assume that a good product will attract attention, but it is getting the product to the customer that defeats most businesses. How often have you seen a great idea fail for one business when another can take it and succeed. Many people can have a great idea and the skill to achieve it but never get the chance to prove it. Who knew that a product like Smart Water would be such a success? It’s not just the idea behind Smart Water, it’s the branding, the marketing, finding the right target audience. There are many things to think about when it comes to product placement, getting your products in stores. And if you are a service-based business, you will find that even if you have a great service, you need to create a brand that clients will buy, and you may even have to market your service continuously. There are no shortcuts when it comes to business, even if it is a side business.
Do you know how you will get the first customers to pay attention long enough to see what a great product you are selling or what an excellent service you can provide? You need the product or the service, but without customers, you may never get the chance to present them. Most businesses, even one’s that do their research fail to attract the customers they need for success.
No matter what the promoters say, starting on credit is problematic at best. The Small Business Administration may guarantee a loan, but the business must find a lender first, and that takes collateral. No matter how detailed your business plan or how many seminars you have attended, the bank will want to see your security.
Startup Costs Add Up
What will you use for start up money? Credit cards are easy; payback is hard, slow, and expensive. Without collateral, the banks will not finance your enterprise, no matter how much those crazy online seminars promise you that they will. A perfect business plan may get you points with the SBA, but it seems to cut no mustard with a banker.
However, if you have a good plan, and a good product or service, and perhaps a good job on the side to keep things going while you get your business up and running – in case you are ready to work hard, learn from your mistakes, and plow everything back into the business for the first few months or years, the dream of a small business of your own can become a reality. It can be satisfying, hugely rewarding regarding money and family security, and better than a college education for learning about the real world.
It almost always takes some cash to get things started, but you might need to consider borrowing your start-up capital to get you through the meager growing phase of your business. Getting a bank or other lender to hand over any amount of money can be difficult these days. You should have some solid financial projections that will show a profit for at least two years. Don’t forget to include a modest salary to live on for a period.
How to Start
How to start a small business? Be as smart and cautious as you can while being as bold and daring as it takes. Should be a cinch if you are cut out to be your boss. Have you always wanted to own and operate your personal side business? Are you looking to change occupations or just make some money on the side? Either way, you need to consider what it would be like taking charge of your destiny. Countless brave souls like you start businesses each year; some that will pay dividends for generations to come. What is the secret to starting that small business out on the right foot?
Discuss your business venture with your family and possibly even with a financial planner. Starting your own side business might be an enduring dream of yours, but if the side business dream is not properly planned and thought out, it can quickly turn from a dream into a nightmare.
This is the first of a two-part series on How to Start Your Side Business. Come back later this week to find out “How You Can Grow Your Side Business.”
For more resources on starting your business, keep reading this blog.