At Siba, we know and value the spirit of entrepreneurship that lives in so many of our students and alumni here in St. Louis. But while the dream and the drive may be there, the “how” can often put the brakes on pursuing even the most promising business concept.
Recently, Siba hosted Missouri Small Business Development Center Regional Director Lynette Watson, who shared her expertise with students enrolled in Siba’s Business Administration program. In addition to running her own event planning business, “NcreDaBle Kreations,” Ms. Watson provides training and counseling to budding entrepreneurs, and assists with the revitalization efforts of the Cherokee Business District. Included in her campus presentation was a list of practical tips for getting any small business off the ground and running.
Pursue your Passions
It may seem obvious, but when pursuing your own business, make sure it’s doing something you really enjoy. No entrepreneur works a simple 40-hour work week, so if you are going to eat, sleep and breathe your business in order to get it up and running, it’s essential that you enjoy the tasks and activities required. Regardless of setbacks and challenges you might face (and you will face some), when you are truly passionate about your work and mission, you are more likely to stay committed and motivated.
Do your Research
Once you have a concept you’re passionate about, it’s time to do your research! First, make sure your product or service is something that enough people are willing to buy at a price point that will work for you. To answer that question, you will need to identify exactly who your potential customers are and conduct market research. It is critical that you design a business/research plan that outlines the methodology, timeline, and resources required. This might include surveys, interviews, focus groups, and/or data analysis. Make sure your research methods are appropriate for reaching your target market. Collect and analyze your data, looking for patterns, trends, and insights that can assist with your decision-making. Finally, use your findings to make informed decisions, and continue to monitor the market to stay on top of changing trends and consumer behaviors. There is a wealth of guides, templates, strategies, and data banks online that you can use. The Federal SBA is another great resource.
Create your Business Plan
Once you believe you have a viable idea and that there are customers out there who will purchase your product or service, it’s time to develop an actual business plan. Start by writing a detailed description of your business, including your business structure (e.g. sole proprietorship, partnership, etc.), target market (e.g. ages, genders, income, location, etc. of your customers), marketing strategies (what means/media will you use to inform your target market about your business and what will those cost?), and financial projections (e.g. how much money will you need to start up and where will those funds come from, what is your budget for year one, year two, etc.?).
It’s also important to identify and analyze your competition and potential challenges, as well as how you plan to overcome those challenges. Your business plan should include a description of your team and their roles, and provide a clear overview of the product or service you will be offering. Once created, be prepared to change it so that it remains relevant and aligned with your ongoing goals. (Forbes has a free template you can download.) Watson advises that you also consider where you want to operate your business—for example, if you want a home-based business, make sure that you are able to legally operate there. If you plan to rent space, be sure the lease does not restrict your operations in a way that would be detrimental.
Make it Legit
You’ve laid a lot of groundwork with your research and business plan development. Now, it’s time to make it official. Watson advises that before you sell anything, establish a Limited Liability Company (LLC) in your home state. An LLC provides some protection from personal liability in most cases from legal actions or debts against your business (always consult a licensed attorney for the specifics). Additionally, there are tax benefits to establishing an LLC rather than a corporation that you may want to take advantage of. Finally, an LLC provides a more formal business structure, which can help your business establish credibility with potential customers, partners, and lenders. While cost varies by state, in Missouri they are relatively affordable. While you’re at it, you should also set up an EIN number with the IRS (it’s free!).
Get your Books in Order
Another important step: make sure you have a strong financial infrastructure. Quickbooks is a good, industry-standard software that offers a variety of features that can help streamline financial management and save time. The software allows small business owners to track income and expenses, generate invoices, manage inventory, and even run payroll. With its user-friendly interface, it is easy to use and can help businesses maintain accurate records that can be used for tax purposes and financial analysis. The software also offers a range of customization options to suit the specific needs of a business. As you grow, you may consider hiring a CPA and/or outsourcing your payroll to a third-party vendor.
Jump on the Feedback Train
Watson also recommends finding professional connections to help grow your business. She’s a proponent of an unbiased advisory board, as well as a mentor to discuss ideas/challenges with as your business grows and changes. A diverse advisory board can offer objective advice and feedback on various aspects of the business, including strategies, operations, finance, and marketing. The board should be made up of individuals who are not directly involved in the day-to-day running of the business, and who can provide an independent perspective and constructive criticism.
In addition to an advisory board, having a mentor can also be extremely beneficial. They can offer advice on a range of issues, from creating a business plan and setting goals, to managing employees and dealing with challenges that arise. Mentors also provide emotional support and encouragement, helping you to stay motivated and focused on their goals.
Don’t be afraid to ask for help! Many successful professionals are happy to lend their expertise to the next generation of entrepreneurs, so don’t be shy about approaching people you admire to fill these roles for you. More often than not, you will find they are flattered you asked them and willing to share what they’ve learned.
Hopefully some of Ms. Watson’s valuable advice can gives you the motivation to get your business idea off the ground. We appreciate her time presenting and meeting with Siba students this month. If you’re looking for more knowledge in marketing, accounting, management, finance, software programs, and/or human resources before you launch your new business, pursuing an Associate of Applied Science or a Bachelor’s degree in Business Administration may be the right path for you. A Business Administration degree at Siba’s St. Louis campus has been a springboard for many of our entrepreneurial alumni!