There are many college students out there who want to change the world and start a new company. It feels like everyday a new start-up is formed or a new app is available for our mobile phones. But it’s important for every entrepreneur to ask themselves the important questions before starting a business.
Top 10 Questions For Starting a Business:
- Why am I starting a business? What product or skills are you offering to the public? Are you passionate about the product you are selling? Are you looking to make easy money? These are some of the questions that every entrepreneur should ask themselves before starting a business venture.
- Who is my ideal customer? What type of customer do you want to reach with their product? What type of customer are you going to market their product too? Every great entrepreneur should be thinking about the changing marketplace and asking themselves what type of customer are we trying to reach?
- Am I prepared to spend the time and money needed to get my business started? How much money are you willing to lose in your first year? How many hours are you willing to sacrifice to get your company off the ground? Unfortunately, it takes most businesses three years before they are able to start turning a profit.
- What differentiates my business idea from others? How can you show that your idea is better and different from your competitors? Many companies are started because one individual saw a flaw in another company’s product and they believed that they could make a better, faster, higher quality of product.
- Where will my business be located? It would be a good idea to brush up on the tax code for the state where your business is being set up. There are many individuals who set up their businesses in either Texas or Florida because there is no state income tax in either state. Some states offer tax incentives to encourage companies to set up shop.
- How many employees will I need? What job and roles are vital to the life of this start-up. Many start-ups begin small and hire more employees as they become bigger in the second or third years. Many entrepreneurs want to do as many jobs/work responsibilities as possible to save money during the challenging first years. It’s important for any entrepreneur to figure out what work they themselves to do and what responsibilities need to have an employee hired to complete the task.
- Will I need to get a loan? Every entrepreneur needs money for the initial start-up and to pay the bills when the company isn’t turning a profit. It’s important for you to look over the finances and create a budget so that the bills are paid on time. Many start-ups need a loan so that there is a steady cash flow to pay the bills while the company is trying to find its customer base/audience.
- Who is my competition? Every entrepreneur should think about the industry that they are a part of and know who they are competing against. Every entrepreneur should know their competition’s history and should look at how their product and marketing is different from everyone else’s. An entrepreneur should also know whether the industry they are entering is growing or shrinking; they should know if the business is strong enough to support another company entering the fray.
- How will I price my product in comparison to competition? How much does a customer need to pay for a product so that the company can still make a profit? If a computer is able to make their product for a lower price, they can lower a price to their customers and make life difficult for a new company. While some companies value offering their customer’s products at the lowest price possible, other companies are willing to sell their product to a more select customer base who are willing to pay more for quality. For years, customers have been willing to pay more money for Apple iPhones, Disney movies, and Nintendo videogames because there was a greater expectation for the high quality of these products.
- What kind of insurance do I need? Many companies get sued for a variety of reasons; it’s estimated that Apple Computers, Microsoft, and Google get sued every day. It’s important for new entrepreneurs to spend money on liability insurance for both products and employees. Nothing is guaranteed in this life and it’s important to be prepared for the unexpected. As the company grows it’s important to adjust insurance as necessary and also look at legal representation.