Thinking about starting a new business during 2016? MYOB CE Tim Reed has some tips.
Be clear on your goals and strengths
It's important to think about what your driving force is. When your business is wildly successful, what impact will it have? What skills are needed to make it a success, and whether you will be making the most of your strengths and if you're able to work well on your own? Make sure the business will make enough money for you - and be realistic about what your costs might be. Where do you want to be in five years' time? Will starting a business help you get there? You are more likely to succeed if you have a clear vision of what you want to achieve. The most successful business people know their weaknesses as well as their strengths, and are prepared to seek help where they need it.
Have a business plan
The process of writing a business plan can be very helpful in structuring your thoughts. A good business plan should be the foundation document of your business - not just something you prepare, then file away. It can be short (preferable), but must be clear. To make your plan work for you in the long term, create a regular review cycle so you can keep an eye on how closely your business is tracking.
Be realistic about costs
If you are ready to launch your business, don't rush to quit the day job - the salary could be useful in the short-term. Be realistic about the funding you will need. It can take a while to build up customers and bring in money so it's also important you stay on top of your cash flow management. Be watchful of what you spend, and make sure that you get paid on time.
Research the marketplace
Your research should help you determine whether there is a market for your product or service. Entrepreneurs are often so passionate about their ideas that they can lose objectivity. Market research can prove invaluable in determining your idea's potential. Eric Reis' book 'The Lean StartUp' describes how to do this cheaply, quickly and effectively. Your aim is to gain a general sense of the type of customer your product or service will serve. Don't underestimate your competition. Find out how well do they are doing it – so you can do it better.
Focus on your target market
Don't try to appeal to everyone. You need to focus on your target audience and structure everything from your website to your marketing campaigns around them. Make sure you are targeting the right people by sending out questionnaires and speaking to your customers through social media. Involve your target customer in the development of your business and continue to test. Consulting your customers will also make them feel like they have a voice, breed loyalty and increase the chance of them recommending you to others. It also helps you to understand what might make them buy from you.
Seek professional advice
Many business owners say that their accountant is the most important adviser they could ever have. The services of a professional adviser can be invaluable and can make the difference between success and failure.