The fact that three quarters of the total startups in the country fail within the first 3 years and one-third of those fall wayward in the initial 6 months, if you’re someone who is all set to start off with a new business of your own, you should do your bit of research before taking the plunge. There are several factors that you need to take into account before beginning with a business of your own. So, what are the few vital points that you should research on to strengthen the foundation of your business? Check them out.
#1: Limited company or a sole trader?
Whichever business structure you choose will have an effect on the taxation policy and the financial and legal responsibility that will be laid at your door. Being a sole trader, you will reap all sorts of post-tax profits but at the same time, you will be liable for all sorts of financial dealings. So, if you’re eager to form an LLC, first know the pros and cons of setting it up before taking the plunge.
#2: Research on the competition that you’ll face
Who else is trying to do what you have planned to do? How well are they trying to do it? It is when you study the competition that is going on around you that you will understand your strengths and weaknesses and you can even learn from other’s mistakes which is something that your customers will always appreciate. Know how much people will willingly pay for the service or product that you’re offering and how you could improve the present offerings. If you find a single big player dominating the industry, note what they do well and what they cater to.
#3: Research on your target audience
If you think your product should appeal to everyone, remember that is going to appeal to no one. You require concentrating on your specific target audience and style everything from the business website to the promotional campaigns. If you wish to offer a product or a service which the audience earnestly wants, you have to invade inside their heads. You need to have your own voice, you need to breed your brand image and also boost the likelihood of recommending your company to others.
#4: The way you’re going to pay yourself
In what way are you going to pay back yourself? This is something that has to be decided way ahead of time. You may have the best intention of ploughing the profit back into the business but still with that profit, you’ve got to drink, eat and maintain a roof on top of your head. Make sure you cut back on extravagancies but determine what exactly you have to live on. Try staying in touch with your financial advisor.
Regardless of the type of business entity that you choose for your business, you will still need to hire registered agents who can accept lawsuits and other business documents on your behalf.