Want to start a new business? Things to consider first!
Mon June 3rd, 2019
Many people dream of starting a small business in Southwest Florida but before taking the leap of entrepreneurship consider these interesting statistics:
- There are approximately 32.4 million small businesses in the US with 1,633,574 of them in Florida
- 1 in 12 businesses close each year
- 50% of small businesses will remain open for 5 years
- Half of all small businesses are home-based
- Over 70% of small business owners pay themselves less than $100,000 a year with 30% taking no salary
- 70% small business owners say they are happier doing their business (higher than 5 on a scale from 1 to 10)
Opening a small business can be exciting but if you take time for initial planning, the odds will be better for success. Here are some start-up tips:
- Make a business plan – It doesn’t have to be long but should have at least a P&L (profit and loss) forecast and a cash flow analysis. You can see what you will be getting into financially and what you will realistically need to run your business.
- Create a break-even analysis. Consider how you will make a profit and all of your business expenses (rent, taxes, insurance, payroll, fees, supplies, inventory etc).
- Use as much money of your own as possible to start your business. If you totally depend on loans, as money starts coming in, you will be using it to pay for your loans instead of using profits to run and grow your business.
- Protect yourself by setting up your business properly. Will it be an LLC, corporation etc.
- Start small and don’t invest in lots of inventory or too many other expenses in the beginning. This is where your pre-launch planning comes into play. Hopefully before starting you prepared your business plan which gave you a clear picture of expenses so it is important to stick to your plan. Especially if you see it is working for you.
- If it isn’t in writing, it didn’t happen. Make sure to implement receipts, work orders and/or contracts as appropriate for your business to protect yourself.
- When it is time to hire, be picky and don’t choose the first person that comes along. Interview them and make sure they are a good fit for your company’s vision including company culture. It only takes one employee who isn’t a good fit to bring everyone down.
- This information is just the tip of the iceberg for considerations when starting a new business. Although there is much to think about and do to start and run a successful business, done right, you can create and live your dream job!
Good luck on your entrepreneurial journey!
Source: Small business Find Law, Fit Small Business