What you should do when starting a new business
Contributions By: Victor Giordano & JW Rayhons
Starting a new chapter in life is exciting, but it can also be scary. Taking risks you have not experienced before certainly makes you rethink the decisions you are going to make. However, with planning and preparation you are able to minimize the risks associated with your decisions, as well as the anxiety associated with them.
One of the crucial points within the planning aspect is research. Researching is essential when trying to start a business due to the amount of important information you are able to gather; information about the expenses related to operating the business, efficient strategies to introduce, how big and accessible the market is, how the competitive landscape look like, the problem you want to solve and how much people want to solve that problem, as well as other aspects involving organization, the company culture, values, etc…
A great tool many business owners use to plan is the “Business Model Canvas”. This tool allows you to identify crucial parts of your business, such as your key partners, relationship with customers, channels of distribution, key activities and resources, customer segments, cost structure, revenue streams, as well as your value proposition, This tool is easily accessible on the internet, having many free templates on-line. In order to create a great business model that is prepared for many circumstances it is essential to go through the Business Model Canvas multiple times.
Choose Your Business Model
The process of opening a business may differ from state to state, but the main ideas are mostly the same. When filing to create your business you may have a few options, but I will focus on three of them: sole proprietorship, partnership, or limited liability company (LLC). A sole proprietorship means you and the business are the same entity, leaving you liable for any business issues. A partnership has different variations, but if you are a general partner you are also liable for business’ issues. A limited liability company means that you and the company are two different entities, protecting you from the company’s liabilities. This is the most important distinction, because in these cases if an individual sues the company the only case you would not have your personal life and belongings at stake is the limited liability company.
After researching, planning, creating a business model, and filing to create your business it will take you a lot of work and effort to maintain your business open. There are different researches with numbers closely related showing that about 15 to 20% of businesses fail in their first year, increasing to about 30 to 50% that fail by their fifth year.
The process of planning and preparing never ends. Even after you have your business up and running, it is essential to be planning and preparing for changes in trends, preferences, and the environment. A business owner who does not stop the planning and preparing process will most likely stay in front of its competitors due to the ability to foresee upcoming trends, and be ready for them.
Planning for your personal life is essential, many times business cycles surprise business owners causing difficulty in their personal lives. Planning for the business and for your personal life will help defeat these adversities. At Rayhons Financial Solutions we are able to provide the help you need in your personal life, so you can focus on what you love. Together we are able to grow stronger and prepared.
There’s more to life than money! The Rayhons Financial family are professionals that want to help you. Connect with us for an initial conversation, call us at (480) 507-2425 or contact us online. We’d love to meet you.
Victor Giordano is a GCU Intern with Rayhons Financial Solutions. Victor cannot offer securities or advisory services.
The content in this article was prepared by the article’s author. Voya Financial Advisors, Inc. does not endorse its content, and the views expressed may not necessarily reflect those held by Voya Financial Advisors, Inc.