What You Should Know About Starting a Small Business

starting a small business

It all started with a dream. The dream was providing the world with the awesome products and services that you’ve spent months (or years) developing to perfection. That dream has now come to fruition, and you’re ready to perform the last ceremonial act of starting a small business: hanging the “Open” sign.

Or are you? Becoming a full-fledged entrepreneur is a lot different than the lemonade stands or lawn-mowing jobs of your youth. And with 30% of small businesses failing in their first two years, it’s more important than ever to be prepared before you begin welcoming your first customers.

While we’d be the last to discourage you from starting a small business, it’s our job to arm you with the knowledge you need to succeed. Here are some “must-knows” to consider before you fling open your (real or virtual) doors!

Research the Market

Selling hand-tied flies near a popular fly-fishing area sounds like a great idea at the beginning … right up until you learn that 27 other small businesses are selling them there, too, and a full dozen of those retailers have been in the area since the mid-1950s.

Does that mean your dream is dead? Not necessarily. But you will need to find a competitive edge. What can make your fly-tying shop stand out from the others? Can you offer additional services that no one else is offering, like rod repair? Can you partner with another small business such as a fishing guide or fish-cleaning service to add value to the customer’s overall experience, thereby making you a better choice than the competition?

Always research the existing market before diving in. It can give you plenty of clues as to what will make you stand out from the crowd!

Watch Your Price Point Carefully

Plenty of small businesses offer deep discounts when they first start out. After all, as the new kid on the block, how else are they going to get people to buy their products and services?

Discounts can get people through the doors, but understand that too many discounts may cause those doors to close prematurely. Even if you do manage to stay afloat, you’ll (eventually) have to raise prices — perhaps higher than you intended — to recoup the losses from your first weeks or months, leading your new customers to feel cheated. “I paid $10 for this when you first opened! Why are you charging me $24.99 now?”

Occasional discounts are fine, but they’re not a long-term solution, and they can actually do more harm than good at the very start.

Cover Your (Legal) Bases

In a world where hot dog stands run by enterprising teenagers can be unceremoniously shut down, it’s more important than ever to make sure your business has all of its legal bases covered. Make sure all your licenses and permits are in order; your local, state and federal tax IDs pass muster; and you’re legally allowed to sell whatever it is you’re selling where you plan on selling it.

Now is also the time to determine what business structure your small business will take. This will have serious implications on your taxes, and no one has time to mess with the IRS!

Nail Down Your Marketing Strategy

“If you build it, he will come” might work for an Iowa farmer building a baseball diamond in his cornfield, but it probably will not work for your small business. The truth is, no one is coming unless they know it’s there — which is why it is absolutely crucial for you to have a fantastic marketing agency on your side.

Don’t wait until opening day to start drumming up business. Work with your marketing team ahead of time to develop a strategy that will have people waiting with baited breath for the second your doors open!

Welcome to the Club!

Small business ownership is one of the most rewarding things you’ll ever experience — but that doesn’t mean it’s without its challenges! Although the excitement is nearly palpable, it’s important that you make sure you have all your ducks, squirrels and water buffalo in a row before you officially open. It will make it so much easier down the road.

At Mischa Communications, we’re excited about your journey, and we’d love to come along for the ride! Get in touch today and let us show you all the ways we can help you in starting a small business!