10 Questions To Ask Yourself Before You Build Your Own Business
We all come to business ownership in different ways.
How will you decide to build your own business?
Some of us are born entrepreneurs going back to the days of a lemonade stand in our parents’ yard. Others get the itch later in life. Perhaps you’ve had an owner-boss that left you feeling you could do their job better.
Whatever the reason, you’re here to build your own business. And while it is fairly easy to fill out paperwork and pay a fee; establishing, operating, and growing a successful enterprise is whole other thing.
You’ve come to the right place. Here are 10 questions to ask yourself before you start your own business:
10 Questions To Ask Yourself Before You Build Your Own Business:
1) What’s the issue or problem?
Businesses exist because there is an identifiable issue or a problem to solve.
This is where a product or service comes into play. However, issues and problems are not created equally. First, try and state the issue or problem you’ve identified in one simple, clear sentence.
Then test it out. Ask your family, friends, the stranger waiting in line behind you at the market if the problem or issue exists for him or her. Take it to social media to receive a wider audience.
And listen. Are people responding with stories of their own regarding this issue or problem?
If so, great, you’re on the right track. If not, you might want to do a bit more research on what issues or problem do resonate.
2) Who is experiencing this?
This is related to question #1, obviously.
But this question is designed to help you take the responses you received to question #1 and identify your target market.
Did teenage girls spit out story after story, validating your idea? Did middle-aged men look at you funny and ask for more details?
Did you find people who recently moved here from another country knew exactly what you were talking about? Or was it the recently married?
The more detail, the better. Demographics, income, educational experience, consumer habits, family size, lifestyle, residence…it all comes in the form of market research.
In order to best reach your potential customers, and to help you build your business, you first have to know who they are, where they live, where they shop, and what matters to them the most.
3) What has already been tried?
Most likely you are not the only person who has identified this issue or problem.
It is in your best interest to identify what has already been done in terms of products and services to alleviate, eradicate, or solve it.
There are several ways to accomplish this additional market research so you can successfully build your own business:
- Do an internet search. Pretend you are looking for a solution and search keywords (and save these keywords somewhere so you can use them in future marketing). What did you find? Anything local? Anything you’ve heard of/tried? What are the reviews? What are the price points? What are the pros and cons of each competitor?
- Ask around. You’ve identified the people who experience this issue or problem. What have they tried? What worked? What didn’t? What was easy or frustrating?
- Read blogs, search Quora and Reddit, comb Facebook groups, find relevant hashtags on Twitter. See what people are talking about…and not talking about. Pro-tip: follow your competitors on social media, it’s the easiest way to keep up with what they are doing.
Once you have some data, it’s important to organize it in a way that is easy to digest and access. When you are making marketing or distribution decisions one day, you can reference what is already out there, working and not working. These lessons will help you build your business around what is needed and what works.
4) What is your solution?
Now that you know there is a need, what is already available, what is working or not, it’s time to start. It’s time to build your own business.
This is when you start filling out the all-important business plan. A business plan can be lengthy, but will incorporate everything: need, competitors, funding, marketing, distribution, and more. Templates and assistance can be found here.
However, one of the most important elements it helps reveal is how your business offering is unique. This is what will set you apart from your competitors. It will be how you address the issue or problem better than anyone else. It will be how you build your business to stand out from the competition.
Perhaps it is a unique set of skills that you have, maybe you can produce something for less money, or even found a solution no one else has thought of yet. It’s time to get creative and do some deep thinking.
Your ability to describe in detail and utilize your unique selling proposition (USP) will be what helps determine your success.
5) How much money do I need to get started?
This question has two parts:
- How much money do you need to start your business?
- How long can you go without bringing in a profit?
The first question is directly based on what kind of business you are looking to build. If you are going to be a freelance writer, you can start your business for the cost of a computer, internet connection, and filing fees.
However, if you are physically making a product, providing a service that requires a more elaborate setup, or have to hire people immediately, your costs will be higher. But don’t despair, there are ways to bring down all startup costs.
The second question requires you to take a look at your personal finances, financial obligations, and other possible sources of income. The goal is to identify your monthly expenses and determine how much time you have to become profitable. This is your runway for how long you have to make your business profitable.
In the startup phase, this runway is intrinsically linked, usually, to your personal finances. Once afloat, your business will have an operating runway as well. It’s always important, for planning and peace of mind, to know how sustainable your business is.
6) Will you enjoy the work?
The passionate entrepreneur can easily get caught up in the dream of working for oneself, being the decision maker, becoming an inspirational leader, and improving the world with the business offering.
But it’s still work. It’s still early mornings, late nights, human resources, research, selling, logistics, procurement, and bill paying.
Some things to consider:
- Are you willing and able to do all of the work yourself?
- Do you ever find yourself getting bored of the idea?
- What are you willing to sacrifice for the well-being of your business?
- All industries change, does it excite you to be part of change?
- Does it feel like a chore to read trade publications, talk about your business, or attend professional industry events?
If you felt negative emotions while answering these questions, perhaps you’ve not hit upon the perfect idea or way to build your business.
7) What are your strengths and weaknesses?
We all have them.
Some of us enjoy balancing chequebooks and accounting for every penny. Others of us despise this work and just want to create engaging marketing campaigns. Some of us love working with people, managing teams. Others prefer to work alone on a laptop far away from humanity.
This question requires you to make a couple of lists:
- What are you good at? What skill sets do you have?
- What do you enjoy doing for long periods of time?
- What are you not good at? What skills are you lacking?
- What makes you frustrated and bored?
The goal, of course, is to do the work you are good at and enjoy. And hire people to do the stuff that you despise and/or lack the skill. How can you build you own business so that you do the work you love and are good at?
8) How will you handle your weaknesses?
For most businesses, hiring people is not an immediate option.
Therefore, you will need to learn new skills or find friends or family who will work for free or a trade.
Think about the skills and interests of your friends, family, or acquaintances. Is there anyone who has some free time and would actually enjoy the work? Can your spouse or significant other spare 30 minutes every evening to lend his or her business acumen to your efforts?
Sometimes you just have to ask. Other times, you might be able to identify a way your skill set and interests can help in their work or life and make a trade.
If you’ve set your sights on learning new skills:
- take account of how you learn best,
- dedicate time each day to learn and to practice, and
- document what questions or frustrations arise
This process will help you:
- converse at conferences,
- build your business in a sustainable manner,
- increase efficiency when searching the internet for answers,
- retain what you’ve already learned, and
- create job descriptions for when you are ready to hire.
9) Is your life ready for entrepreneurship?
It’s not easy.
And it’s not only the time commitment of physically being ‘at work.’ Entrepreneurship is all-encompassing.
Your business will occupy your mind at dinner, your niece’s wedding, your son’s hockey match, while you should be sleeping.
And people know when your mind is elsewhere.
What do the significant people in your life think about your business idea?
Are you in a basketball league? Do you attend religious services regularly? What are your commitments during the holidays?
Because business doesn’t stop. Take the time now to develop a plan for handling time conflicts, staying healthy, and maintaining happy relationships. Make a commitment to review and revise (if necessary) this plan as your business grows.
10) What is your growth plan and out plan?
If your immediate response was ‘grow a lot’ and ‘do it forever,’ you may have unrealistic expectations.
Growth is relative. You could hit a market at the right time and explode. Sounds great for your bank account, but it comes with considerable stresses as well.
And if you have partners, it is essential that you and all partners agree on the type of growth your business will be pursuing.
‘Forever’ is likely dependent on your age. If you’re a young millennial, you might be able to postpone this decision. However if you are middle age or approaching retirement, there are issues to consider such as:
- retirement planning,
- selling your business,
- transferring your business to a relative,
- opting for an ESOP (Employee Stock Ownership Plan), and
- how to set up operations today so that your role can be decreased in the future.
The road to building a business is exciting.
It is one of the greatest adventures you can have in life. And of course with all adventure comes risk.
Make sure you do you homework before and along the way to mitigate the risk and increase the fun.