The local business market has been led by a few industrialists, over the years, micro, small and medium enterprises (MSMEs) have been on the rise. But eventually, starting your own business is a risk that many still hesitate to take.
Global financial advisor Peter Lundgreen shares his perspective on starting your own business these tips will help you on ease starting your own business.
8 Tips For Starting Your Own Business
1. Go for your passion.
“If you don’t like (your business), it won’t succeed.”
For those who are unsure of what business to enter into, he advises honesty with one’s self. “Ask yourself, where do I add value? Where are my strengths? Am I good in service?”
- Check if you have these traits.
Lundgreen listed some important traits that entrepreneurs should have. These include being “willing to work for many hours,” being good at motivating people and being service-oriented. Those new to business should also be ready for “higher mental pressure” that running an entire operation will require.
- Plan well, but do not be a perfectionist.
Lundgreen shares that he planned for an entire year while in his previous job before he took the leap to start his own business. “Don’t go back home in your own lab without communicating,” he says.
However, you can only test so far. “Don’t spend all your money in developing the perfect product. Show your product when you’re half ready.” Once business is rolling, you can then improve your product or service.
- Have realistic expectations.
“Be ready to have no income,” he says. “The bills for a start-up tend to come bigger and faster than expected, while the income tends to be later on.” One needs to save up for the time that they won’t have a steady income, and he also emphasized that expenses have to be carefully considered as needs versus nice-to-haves.
- Check if you’re more suited for franchising or entrepreneurship.
Lundgreen advises it as one way of entering the business market without spending too much capital.
How do you know you’re fit for it? He says if you walk into a store and notice what you can improve, then you might be more inclined to run a franchise. But even if it’s a good way to get started, it’ll be hard to make a name for yourself since you are bound to the franchiser’s business frame and you are still sharing profits and working for other people.
Those who want to make their own original products or services could look into doing things on their own instead of relying on a known brand.
- Work with someone you trust, but avoid family and friends.
Lundgreen says this is “always dangerous.” He says if you work with anyone there has to be a clearly defined contract, and family may find this awkward or off-putting.
You could be better off working with a “trusted professional partner” or on your own. “If you want to move fast, do it alone,” he says, as decision-making can be delayed with a group or a partner.
- Get support by growing your network.
He says growing your network is very important to find your way into the specific industry you want to enter. Through this, you can find “business angels” that can help finance your venture and also give you advice.
- Work hard on that very first investor presentation.
Lundgreen said potential business owners need to “be careful” about the first presentation. If you get shut down, it may be difficult to do it a second time.
He advises to create an investor deck, which is a short presentation to give a summary of your business plan. This should clearly define your business idea, why you did it, and why it’s better than what your peers or competition is doing. What’s important is to make sure it is realistic and that you are being honest to yourself about every aspect of the business.