10 questions to ask yourself before starting your own business
With the rise of inflation and increase in the cost of living, making ends meet isn’t easy. For this reason, more people are leaning towards the entrepreneurial route. However, embarking on this venture is never an easy task and if accurate research is not conducted, things can go terribly wrong.
With the assistance of experts, Moneybags writer, Alina Hardcastle lists 10 questions you should ask yourself before starting your own business.
Is this the right time to start my own business?
It’s said in life that timing is very everything. Entrepreneurs and founders of digital agency, Yellow Door Collective, Emma Donovan and Dominque Kotze, couldn’t agree more. The two suggest that when starting a business, you need to consider the current political and economic climate and the impact it would have on your start up. It’s also advised to take a look at how your potential competitors are managing.
What problem is my business solving?
With any business, determining the gap you’re filling is fundamental. Eugene Beck, CEO of RoadCover and founder of the “Real Juice”, states that all successful businesses provide a solution for people’s pain points. He elaborates: “If you look around, most products and services were created as a solution to a problem. Whether solutions are necessities such as electricity or improvements such as planes, they were based on meeting and solving an issue.” Therefore, you need to research your target market and determine what product or service will assist their needs.
Is my product or service different and competitive enough?
So, how do you ensure that your product stands out in the market? To put things into perspective, Donovan and Kotze suggest that you perform in-depth research and figure out who your competitors are. You will need to determine what makes your business unique and what would win consumers over, if this cannot be answered, it’s best to go back to the drawing board.
Founder of ENN Africa, Stephen Read, adds that if you find that you have no competitors, there may be a reason which should be looked into.
What resources do I need?
You also need to take into consideration the resources that you need in order for your business to operate efficiently. It’s important to do as much research as you can about your business, to have a clear understanding of the components required.
What are the risks and challenges?
Although what lies ahead is uncertain, Beck highlights the importance of anticipating potential difficulties which may or may not be experienced when establishing your business as a viable entity. He says: “Challenges and risks often become the markers and stepping stones, guiding a business in terms of what needs to be addressed or changed or even transformed into an opportunity. Problem solving is an integral part of a start-up, or managing any business. Although some entrepreneurs may seem to have a natural ability for resolving issues, this is a skill which can be learned and developed. By clarifying issues and looking at problems from different perspectives, you are more likely to find the best solution.”
How much capital do I have/need?
It’s all good and well having a great business plan, but if you don’t possess the required capital, it’s unlikely that your plan will materialise. Read suggests analysing your current financial status. He recommends asking yourself the following questions:
Am I going to take on debt and/or put my assets at risk?
Can I afford to start this business and do I have enough capital so that I am not setting myself up for failure?
Have I received the advice of a professional (accountant/banker) as to the financial needs of starting and running this venture?
Can I persevere through tough times?
You need to know from the onset that this is by no means an easy journey. Read explains that entrepreneurs are generally paid last and that planning may not play out as anticipated, hence the importance of clarifying your why, i.e. the reason for being in business. Beck explains: “A powerful way of persevering during tough moments is to clarify your why. Every business needs to make a profit in order to survive and grow, but your underlying reasons need to be deeper than this. ”
Do I have the necessary strategic partnerships and relationships in place?
It’s important to treat your business partnership like a marriage. Kotze and Donovan explain that the key to a successful start-up is to ensure that you have trustworthy partners, and that you can leverage off existing relationships and contacts.
What is my exit plan?
So, what happens if your business becomes a success? What will you do with your business? Perhaps put it on the stock exchange? Sell it? Or leave it to your children? Read expresses how important this question is and that you need know your exit plan.
Will my loved ones support me?
Finally, you need to make sure you have the support of those that are closest to you. You need to explain your vision and the sacrifices that may be needed in order to achieve success. Read concludes: “This will be an emotional journey and it may be a bumpy ride so it is important for everyone to understand [your] desire and determination.”