You've decided to start your own business. You want to spread your wings and think you have what it takes to run your own show. Now you just need an idea of how to get the business started. Well, there are several ways you can start a business, but most of them are dictated by how much you want to invest from day 1.
1.)
Buy an existing business. This is a great idea in a down economy because there are a lot of businesses that possibly did not get off on the right leg. With the right business know-how and some dynamic changes, these ventures could do really well. Business brokers manage the purchases and sales of businesses, and they can provide a wealth of information on how to purchase one that is already producing revenue, but maybe not yet a profit. Some websites such as
http://www.businessbrokers.com/ actually have a list of active business for sale by type and location, and even offer the service of appraising the business for you, so you know if you're getting a good deal. Buyer beware, though... turnkey businesses may cost a lot of money and good deals are seldom published. You may need to visit businesses in your local area that you know are either struggling, dated or owned by people who just want a break. Maybe you can make them an offer?
2.)
Buy a franchise. Franchises are businesses in a box. They can include basic concepts or they can provide complete start up assistance, location procurement and even provide all of the equipment and suppliers for one fee. Most franchises have some kind of monthly fee or stipend that you pay whatever organization owns the franchise and terms can vary greatly. You definitely want to read the fine print and make sure you are aware of what you can and cannot do as a franchisee. Some, very established and profitable franchises may be extremely restrictive about the areas in which you choose to operate, and may cost between $200,000 to $500,000 to get started. However, most are profitable within relatively short periods of time, which is worth the start up money for some. Entrepreneur Magazine recently performed a review of the Franchise 500, Top 10 Franchises which you can find at
http://www.entrepreneur.com/franchise500/index.html.
3.)
Start from your home or garage. Home based businesses can become profitable quickly, especially if they are service businesses. The start up costs can be minimal and overhead can be shared with your household. If you are providing a service at a customer's location, then location for you is not as important and a home business can be the best way to go. However, if you have customers that will need to come to you, be aware that come cities and counties have restrictions for home businesses, license requirements and signage. Some people are also apprehensive about dealing with businesses that are not established, trackable and at a commercial location. The solution to this can be to rent an executive office or virtual office where you meet customers when needs be. One company that provides this is
http://www.corporateofficecenters.com/. They offer everything from offices to meeting rooms to answering services mostly in the South, but there are others found on Google that are nationwide.
4.)
Network marketing. This option is a hybrid between a franchise and a home business and has been endorsed by experts such as Warren Buffett, Donald Trump and the Harvard Business Review. For a fee, the company enables you to become a distributor, allowing you to essentially start your own leg of their business and recruit your own sales team. Their compensation packages can be lucrative and depending on the products, you could grow your business rather quickly. You are able to duplicate your efforts through your sales team, so you do less work eventually. However, be aware that there are a lot of companies that pose as legitimate companies, but can be scams. When you are doing your research, please make sure that the company is listed as a member of the Direct Selling Association
http://dsa.org/. Members have to adhere to ethical standards and are ranked annually by the organization. Make sure and stay amongst the most established, top 50 ranked companies and you should be fine. Also, make sure to read about the cost of start up, method of training, pricing of products, return policy, and monthly minimum volume requirements before making your decision.
5.)
Start your own traditional business. This is the good, old-fashioned way to start a business. You save up your money, you lease a storefront or office space, you get a phone system and you put a sign on the door. The costs can be high at first because you will be unlikely to get a credit line in your first two years. Therefore, if you have inventory you may need hundreds of thousands to get started. If you need equipment, you may be able to take out some short-term equipment loans, but will have to make a substantial investment and will need to personally guarantee the loan with your own assets and credit. The small business administration may be able to approve you for an SBA subsidized loan for equipment, start up costs and location financing. One essential for any type of business, but especially a traditional business is a good business plan. You need to ensure that you are taking into consideration all of the things that can go wrong, such as injury, disability, legal costs, legal defense and employee theft or misconduct. You then need to factor these into your start up costs. Check out the Small Business Planner at
http://sba.gov/Whatever you decide to do, make sure you are well informed.
Read everything you can, talk to other business owners, find a great CPA and an even better attorney, join networking groups, read books, take classes and do research online. You can never have too much information.
I welcome any and all of your questions regarding what your plans are for your business.
To your success!
Jenn
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