If you have decided to go it alone and launch your own venture, it is likely that a substantial amount of your time will be dedicated to writing a strong business plan, developing a high-quality product or service, and finding the right employees to run your enterprise.
As failure will not be an option for you, you must ensure you don’t put even one foot wrong when getting your business off the ground. Here are the four factors you shouldn’t overlook for your startup.
- The Potential Risks
Some organizations will have higher risks than others. For example, if you choose to launch a pharmaceutical, auction or gaming business, you could struggle to find financial investment or to process online payments. What’s more, you will be at greater risk of legal penalties and lawsuits.
It is, therefore, imperative to review the potential risks a company could face during its lifespan. You also can counteract potential vulnerabilities by choosing the right insurance policy for your organization. For example, every large or small business should receive a workers compensation insurance quote to find the right coverage for their needs in the event of a work-related illness, accident or fatality.
- The Size of the Market
While you might believe you have a firm product idea and are filled with a great passion for an industry, it might not be enough to secure your success. Before you start developing a brand, creating products and launching website, you should embark on a detailed market analysis to ensure your success in your chosen industry.
For example, you must identify how many direct rivals you will be forced to go up against, as well as whether your product will fill a gap in the market. Answering these questions can determine whether you should launch your startup venture.
- Economic Conditions
Good timing is crucial when launching a new business. Depending on your business model, it might be beneficial to launch your venture during times of economic growth; however, it could make financial sense to kickstart a company during a recession.
Many people believe no-one is buying products or services during a recession, but this isn’t necessarily the case. In fact, your business could potentially make more money during economic hardship than growth, as people might become more reliant on your goods. It is important to gain a solid understanding of your industry, and to research how economic cycles could impact trade.
- Your Personal Financial Circumstances
While it is crucial to keep your personal and business finances separate, one can affect the other. After all, your credit history can determine whether you can secure a business loan and make your company idea a reality. Also, living with debt could detract from your focus and may lead to you making financial mistakes along the way.
It is imperative you are in good financial standing before starting your first business. You also must improve your financial literacy to avoid making foolish mistakes with your personal and/or company cashflow.