Want to start a business?

CHECKLIST FOR STARTING A SUCCESSFUL BUSINESS
During the planning and start-up stages of the business enterprise, you are likely to be faced with a wide assortment of problems and tasks. A checklist can be an incredibly useful tool for helping you to think through the many variables that you may forget in your rush to start a business.


The checklist below is designed with two purposes in mind:
a) To help you in evaluating your readiness to launch your new venture; and
b) To help you in successfully managing your business after you get it off the ground.

Take your time to consider each of this questions properly. Now is your time. Once you are swamped with the day-to-day details of operating your business, you probably will not have time to carefully consider eaach of these important questions.

Please bear in mind that the checklist presented here could not possibly address every possible obstacle that you might face. Likewise, not everyone of the listed questions will apply to every individual business sitiation.

Most of these items however, will apply to you.

1. Does your family go along with your desire to start a business? The deamnds that the business will make on your time and resources could be a source of family problems if the family is not with you from the beginning.

2. Are you the kind of person who acts quickly when you see an opportunity, or are you generally a procrastinator? Successful business people often act on instinct, even when the situation cals for some risk.

3. Are you good at managing your own time and energy? In business, it is often said time is money. A person who wastes time on things that are not profitable to the business tend to lose opportunities and money.

4. Have you saved money, made business contracts, taken special courses, or read particular books for the purpose of preparing for business ownership? Preparing yourself for a succesful start requires that you carefully consider the implications of the desicion, and this process takes time. You have to be emotionally, financially and mentally ready for the challenge before jumping in.

5. Have you had training or experience in your proposed line oof business or in one similar to it? Going into a business in which you have no previous exposure or experience is very risky. It is wise to study the type of business you intend to start so that you don’t fail unneccessarily because of ignorance.

6. Are you easily discouraged? The road to success is fraught with challenges and setbacks. If you are a person who gets easily discouraged, then you might want to think again before starting your own business.

7. Are you willing to work harder in your own business than as an employee? When you become your own boss, there will be no one to push you to work except yourself.

8. Are you willing to risk the uncertainity or irregularity of your self-employment income during the early years of the enterprise? Your business is not going to become profitable overnight. You should be ready to face the moments of slow cash flow.

9. Can you survive failure? A pragmatic businessperson works hard and believes that he can succeed, but he also recognizes the possibilty of railure. Be sure that you do not expend yourself and your resources to the extend that business failure would mean personal failure.

10. Have you carefully considered and listed down the all the reasons why you want to enter business on your own? Succeeding in your own business requires that you be convinced that what you are doing is right for you. It is a good practise to write down your reasons for choosing this course, and that you be convinced about the reasons.

11. Have you compared the income you will earn from your new business with what you could make working for someone else? If your primary reason for going into business is to make money, then you need to ensure that the returns you make from the business are greater than what you can earn workinng for others. In order to answer this question, you will need to work out the projections of revenues and expenditures to determine just what you can reasonably expect to earn at the end of every month.

12. Have you discussed your proposition with competent advisors who are in different occupations or who have differrent viewpoints? A wise person will always bounce his/her ideas on others before plunging into the unknown. You may gain some useful insight that could save you from getting hurt unneccessarily.

13. If your business will be based on an entirely new idea, have you attempted to secure actual contracts or commitments from potential customers instead of merely getting their polite approval of your idea? Most first-time business people make the mistake of believing everybody they talk to, even when such people are not being completely honest. People may say that what you are going into is so great, but the queation with which you have to come to terms with is: will they buy?

14. Do you know how much money you will need to get the business started? Make sure that you have carefully worked out the start-up cost of the business, and that you have a fairly reasonable estimate of the amount you will need each month atleast for the first six months.

15. Have you saved enough money to start the business on your own? It is not a good idea to imagine that you can start a business relying only on borrowed money. You should try, as difficult as it may be, to put some money aside to reduce the cost of borrowing.

16. Do you have sufficient income to live on for the first six months to one year dirung your start-up period? You need to be sure that you have planned for how you will cater for youe personal needs during the start-up period before your business begins to earn sufficient income to support you. Do not “mortgage” your family to the business to the extent that they will suffer if the business does not perform well.

17. If you plan to secure much of your initial capital from friends and relatives, are you sure that your business will remain free of “friendly” domination? It’s OK to borrow from people who are willing to help you get started, but be sure that the help does not come with strings that will be more of a burden than you can manage.

18. Are you aware of money sources that will help finance your business in the event that you exhaust your initial capital? It would be a good idea to try to line up some potential back up financing even if you think you don’t need it.

19. Have you considered all the factors for and against each legal form of organization (i.e. Sole proprietorship, Partnership, Limited Liability Company)? Get some advice from a lawyer, if neccessary to make sure you fully understand the implications of each form.

20. Have you planned a system of records that will keep track of your income and expenses, what you owe other people, and what other people owe you? Dont make the mistake of starting your business before working out how you will keep your records. It is much easier to think about such things at the beginning than when you have started operating, and bad habits begin to set in. It may be a good idea to have an accountant to help you set these books in place and explain how to use the system if you do not have such experience.

21. Will you be able to hire employees locally who posses the skills you will require? If you intend to hire people to work with you in the business, be sure that the kind of people you will need will be available, and that you can afford them.

22. If you plan to employ your friends and relatives, are you sure the family will not get in the way of your business? Hiring friends and relatives is always a tricky business, and you need to be sure that your expectations of them are clear, and that they are prepared to work. Remember that you are starting a business, not a charitable organization.

23. Have you decided on the formula or method you will use in pricing each class of goods and services? Whether you intend to sell tangible goods such as shoes, or a service such as hairdressing, you need to be clear in your mind about what price you will charge and why.

24. Have you considered the probable reaction of your competitors to your pricing practises? Whatever pricing structure you intend to adopt alwyas be aware of the competition and how they might react to your prices.

25. Have you planned definite ways to build and maintain superior customer relations? You need to carefully consider what you will do in order not to lose customers that buy from you. Think of things they might consider as advantages to doing business with you.

26. Have you defined your petential customers so precisely that you describe them in writing? It is important that you have a good knowledge of the kind of people who would be your likely customers. Don’t start your business with the assumption that customers will just come. Customers have to be targetted and pursued.

27. Have you given value to the advertising values of the proposed names for your business? The name you choose for your business is important because it tells the world alot more about your business than you may realize. Choose a name that is simple to remember, and which conveys a message about the kind of business you are involved in. Don’t get caught up with the common tendency of many first timers who feel that they have to somehow use their own names.

28. Do you know how much credit you can get from your suppliers-the people you will buy from? Credit is one of the cheapest ways to finance a business, and you should talk to anyone who will be a supplier to your business about what you have to do in order to be allowed credit purchases.

29. Have you planned the basic procedures you will always follow before extending credit to any applicant? Just as you will be looking to suppliers to give you credit, you can expect that many customers will also be asking for credit. The general rule is that you don’t offer anybody credit until you know them well, and until you can establish assurance of their trustiworthness. If possible, avoid giving credit to friends and relatives.

30. Do you know what sales volume is neccessary to break even? The question here is: how much would you have to sell in order to cover all your operating expenses? Knowing this figure will help you in establishing targets that you must reach on a weekly or monthly basis.

31. How long do you estimate that it will take your business to return your investment? Your investment is the amount that you have put in the business to get it started. This includes any equipment or machines that you must buy, furniture, construction etc. You should be able to cover this initial cost from the profits you earn in your business within a reasonable time.

32. Have you determined what are usually the largest itmes of expenses for your type of business and made definite plans for controlling these expenses from the very beginning of the business? Controlling your daily expenditure is a task that you will have to be on top of from the beginning. Spend some time thinking about possibleexpense items that will need special attention to avoid wastage.

33. Have you ascertained from reliable sources all regulation that must be complied with in your business? Some businesses require special licences and permits that you must have in order to remain legal. Make sure that you have done your homework so that you don’t get into trouble with the authorities once you get started.