The COVID-19 pandemic has had a major impact across industries and sectors. As per Global Entrepreneurship Monitor, a survey-based study of entrepreneurship across more than 50 countries, the pandemic is responsible for seeing a 13% decline, from 2019 to 2020, in the number of individuals intending to start a business in the next three years.
However, not everything as grim as it looks for potential entrepreneurs. As per the same survey, the ‘new market realities post COVID’ instilled confidence in 65% of early entrepreneurs, who saw new opportunities in the present scenario.
If you are also one of those individuals who want to take advantage of the ‘new market realities’, it is imperative to focus on doing the right things the right way. There is a myriad of things to know and execute before starting a business, which are summarised in five easy steps.
What to know Before Starting a Business?
Have a Robust Business Plan in Place
Like most other things, it is essential to develop a plan before executing the idea of having a start-up. The business plan would include answers to questions like –
- What is your business model?
- What do you plan to sell?
- How are you going to differentiate your offerings from those of your competitors, if any?
- What to consider before starting a business?
Choose a Viable Revenue Model
Once you know the products you would sell and the business model to follow, the next question is which revenue model to choose. Every business out there exists to make money. In a cut-throat landscape, you must understand how you will make money. For example, will you go for a fixed price model with a single product/service, or do you want to offer multiple products/services? Do you want to sell them in a cluster or individually? Without a viable revenue model, it would be difficult for you to generate cash flow.
Know your Target Group
For your business to prosper, there have to be customers willing to pay for your offerings. Thus, knowing who your customers are is one of the answers to what to know before starting a business. The clearer you picture them, the easier it would be to market your products. It includes creating a persona of your target buyer and understanding their characteristics.
Validate Your Idea
Practice makes a man perfect – it is one of the most vital things for you to remember before you embark on your start-up journey. Before you introduce your offerings in a full-fledged manner, you must test them to understand their viability. It can include launching them in specific markets or to a handful of customers. It will give you clarity and also help you gain confidence in your idea.
Where Will the Start-Up Funding Come From?
The most vital question for you to answer before you begin your tryst to be an entrepreneur is about your start-up financing. Do you have enough capital, or do you want to take a loan and utilise it for your business? If you are looking for external start-up funding, will any of your friends be interested, or do you want any corporate or banking body to fulfil your needs?
If you are looking to opt for self-investment, it is essential to start planning your finances as soon as possible. Working on a diverse portfolio could help you to reach your goal of generating enough capital for your business a few years down the line. One way to achieve this is through mutual funds and stocks that are in line with your appetite for risks.
You can also explore investment options with an expert who can create bespoke financial plans that are aligned with your goals, risk appetite, age, and financial standing. Reach out to one today.