You have decided that you do not want to buy a business, you would rather start your own business. Before you open the door and start getting new clients, you need to be prepared. Things to think about include marketing plan, financing, working capital, setting up a bank account, staffing, if you need inventory, setting up accounts at suppliers, business cards, stationary, accounting software, computer, access to the Internet and other types of software. What do you need to put in place before you open the doors to the new business? Do you wait until everything is perfect or do you start without thinking about strategy, marketing, finance etc? It is great to get a new customer but if you cannot provide them a service or deliver the product that they ordered, how are you going to keep them in the future?
What is the priority of things that you need to do in advance? I believe that the first and foremost is defining what is the new business, what are you providing, a service, a product etc. Some investors want to be too many things to everyone and then no one will understand what service or business you are actually providing. Rather define where you will start and you can always grow to provide more services but if you are stretched too thin, you will not be able to do a good job at any of the tasks. Keeping your customers is as important as getting them in the first place.
Once you define what the business will be doing, do you have any marketing concepts, it can be simple like calling all your old contacts and friends and relatives. But once you go through that list, what next? You need a place to deposit your first check and to pay bills so you need to get a bank account. Before you open the business, you need also to determine if you want to be a sole proprietor or an incorporated business.
Once the business is open, you need to be organized including knowing if you are making or losing money. You need to monitor this closely because if you do not realize for 6 months that you have priced your products too low, you may not realize that you are slowly running out of money. Too many people believe that if they buy an accounting software program they can become an accountant. People do not realize that garbage in is equal to garbage out. First a person has to master the accounting software program but they also need an understanding of accounting. The programs are data entry only and if you enter in incorrect information, the output will be wrong. Many investors skimp on accounting, they do not think it is important so they hire the cheapest person they can find. Remember, you get what you pay for, cheap does not always mean accurate.
It is important to be prepared when you open a business therefore you need to anticipate as many things as possible before you open. There will be many more things that you discover that you did not think about but if you can think of the majority of issues, you can plan on business development rather than spending all your time putting out fires because you never planned in advance.