Have you ever dreamed about being your own boss?
Does the idea of becoming an entrepreneur, working at something you're passionate about, and having flexible working hours appeal to you? If you've always craved running your own business and want to start with entrepreneurship, I've created this beginner's guide as a starting point.
Indeed, getting into the entrepreneurial mindset is the first step. That's because being a business owner takes lots of determination and a creative drive to find solutions to various matters. Entrepreneurs must undertake many different responsibilities and roles to achieve success.
Business ideation is a creative journey to define your business purpose. Defining your product or service, how you plan to deliver it, and, most importantly, why you're doing it. Whether you're pursuing a passion or providing a solution to a problem, it's essential to identify your business value proposition.´
Creating Opportunities: Business Ideation for Small Businesses
Who are the people most interested in your product or service? What are their needs and pain points? Although going broad seems obvious to reach as many buyers as possible, aiming at a specific target audience allows you to build relationships with prospects, thus converting them into customers.
We encourage market research to ensure fit in the chosen market. This includes conducting competitive analysis and identifying customer segmentation. Also, you should analyze the industry your business is involved in and assess internal and external factors that could affect your business using tools such as Pestle and SWOT analysis.
If you're unsure how to conduct this research, hiring a market researcher who can guide you through the process is always a good idea.
Marketing Strategy
Once you have defined the market in which your business operates and the value it delivers, it's time to craft a game plan for reaching prospective consumers and turning them into customers. The four Ps marketing concept comes in handy. It summarizes the four key factors of any marketing strategy: product, price, place, and promotion.
Having a stakeholders map is also helpful for planning stakeholder engagement. Different stakeholders, such as customers, employees, shareholders, suppliers, and the community, can influence a business in various ways. After you have identified and mapped out your stakeholders, you can then create a content strategy defining the best formats for communication purposes, such as blog posts, videos, infographics, newsletters, and how-to guides.
Creating a buyer persona is a great way to represent your target audience based on reliable insights and research of your existing or desired customers. By doing so, you can identify your audience's preferred channels, which can help define the content distribution workflow according to your business model. Some examples of these channels include your website, social media, newsletters, and YouTube. This approach can provide valuable insights and help you create a more effective marketing strategy.
7 Tips for Achieving Sales Success
While Google Ads can be effective, it's important not to rely solely on it for generating sales. Diversify your marketing approach into your marketing strategy, including digital and physical channels. Besides, leverage your network. Reach out to family, friends, former colleagues, and acquaintances who may be potential customers.
In summary, combining actionable sales tactics can propel your SMB to success.
Operational Planning
An operational plan is a comprehensive roadmap that outlines the specific actions required to achieve the goals set in strategic planning. It provides a clear view of the tasks that need to be performed, who is responsible for them, and how they should be executed. It helps business owners and their collaborators to optimize their efforts and streamline their workflows, whether related to finance and administration, customer service, or deliverables management.
Running a business requires focusing on practical aspects, optimizing day-to-day operations, and efficient resource allocation. With the help of the business model canvas, describe your business's value proposition, infrastructure, customers, and finances, aligning with the business activities.
By describing the infrastructure, you outline your business's key partners, the essential activities related to your business, and the primary resources required. You better understand your funding and cash flow needs as you detail your business's resource needs, such as capital investments, staff members, and software.
As you have gone through marketing strategy development, you've already defined your customer segment, how you'll manage customer relationships, and which channels you'll reach out to your customers along their customer journey: before, during, and after-sales.
Customer Service: The Best Driver of Business Success
Finally, describe the finance aspects defining the cost structure and the revenue streams. On the cost side, what are the most important costs inherent in your business model? What are the fixed costs and the variable ones? By revenue streams, it's vital to precisely define what type of revenue your business generates: product sales, usage fees, subscription fees, rental/leasing, brokerage fees, etc. Is it fixed pricing or dynamic?
Establishing timelines and milestones and measuring outcomes helps achieve short-term goals. That's when a comprehensive roadmap comes into play. A business roadmap visually represents your action plan in a given timeframe. It highlights active and upcoming work, helping to track the business strategy achievements.
Effective operational planning ensures a business function efficiently, reducing waste and meeting customer demands.
Financial Management
Effective financial management is crucial for small businesses as it enables them to make informed decisions regarding utilizing their financial resources. This involves forecasting revenues and expenses, creating cash flow projections, and maintaining accurate financial records.
It's essential to detail your cost structure and revenue streams for a business plan. When it comes to cost structure, you need to consider the production costs, salaries, payroll taxes, sales commissions, advertising, leasing, depreciation, insurance, etc. After that, it's time to forecast sales based on your product or service list and an estimate of the number of units you will sell. If you run an established business, this task will be relatively easy. But if you're starting a new business, it might get tricky. It's essential to be honest with yourself and make accurate predictions to get a better Profit & Loss (P&L) forecast.
How to Improve Your SMB's Invoicing Process in 4 Steps
Once you have created a P&L forecast, you can use it to make a cash flow projection and determine the sources and funding required to get your business up and running. There are several ways to secure financing, including taking initial loans from friends and family, finding a business partner to share the financial burden and help with the business development, or attempting to raise funds through a crowdfunding platform like Kickstarter, GoFundMe, or Indiegogo. You could also pitch for venture capital (VC) funding or a traditional bank loan.
We highly recommend that every entrepreneur and business owner acquire basic financial management knowledge. It's highly beneficial! Furthermore, to incorporate financial management software into their business routine. The available options include QuickBooks, Xero, and Zoho Books, among others.
Maintaining accurate financial records and the ability to access your financial health in real-time is necessary and a competitive advantage in an extremely competitive environment.
Developing a business plan is vital to kick off your entrepreneurial journey. As the saying goes, if you don't have a plan, you're planning to fail.
However, entrepreneurship is a long and winding road. Although a well-crafted business strategy helps, it takes resilience, creativity, perseverance, passion, flexibility, discipline, and lots of determination.
“Plans are only good intentions unless they immediately degenerate into hard work.” Peter F. Drucker
