How to start a small business! Ask this question from a bunch of people and it would seem that everyone thinks they know the answer – but in reality most new businesses fail within the first year of startup.
Did it ever happen to you that you saw a new kind of business and suddenly it struck you that you once had a similar idea? If you are anything like me you must have had several ideas over the past and would have felt the desire to start a small business, and out of those ideas you might even have pursued some, which you felt more confident about. Let me see here guess, first you tried to learn how to start a small business and then you started laying out a business plan and while contemplating, either your doubts about the idea started getting deeper and deeper because you realized that the product or service is not compelling enough to be the next “Google” or you thought that it’ll be too big of a responsibility and would require too much hard work, or maybe you even decided to proceed with the idea and started a business thinking that the hard work will pay off, but it never did!
It happens to almost every one of us and sometimes we skip or even fail on some great ideas simply because of some popular misconceptions. There is no 10 step plan or method that can tell you how to start a small business and make it successful but there are some major misconceptions that usually become the reason why most small businesses fail. I am going to discuss two of the most important factors of a business failure.
1- You need to have a compelling and unique product/service.
When people talk about how to start a small business they usually seem to have a greater emphasis on the need of a compelling product. Although it can be great to have a product/service that can sell itself, the reality is that not every market provides such advantage. If you want to start a small business and are sitting there waiting for that colossal idea – the odds of just coming up with such an idea are probably one in a million. That’s even worse than the odds of falling off a bicycle and breaking your neck.
2- The Business plan is just a formality.
Most people seem to think that a business plan is not needed for a small business or a formal plan is only needed when you are looking for an investor or applying for a loan. A business plan is the best way to learn how to start a small business, because every business opportunity is unique in itself. First of all I want to emphasize that it’s not just a formality. The business plan is perhaps one of the most important part of the process for a startup business because it shows all interested parties including yourself about how serious you are about your business. A comprehensive business plan gives you the idea about your competition, market requirement, feasibility of a business opportunity and many more contributing factors. You can’t expect your business to be successful if you don’t know your competition and if you have not done an extensive research about whether it is an opportunity worth pursuing or not. All the hard work in the world would make no difference if you are not familiar with these important aspects of your business.