Are you an Entrepreneur?
If you are reading this article is because after reading our previous article “Are you an Entrepreneur” then you believe that you are an Entrepreneur, and are ready to start the process to launch your new business venture. This and the future articles on this series will help you identify what are the steps that you should follow in order to increase your odds to be successful, and to avoid some of the most common errors that new business owners make. It is true that many people have started business without a formal plan, and have succeeded, but it is also true that over 90% of small business fail within the first 3 years.
Why do New Business Fail?
Regardless of the industry, new or small business usually fail for the same reasons:
- Lack of Experience
- Insufficient Capital
- Poor Location
- Poor Inventory Management
- Over Investment Fixed Assets
- Poor Credit
- Personal Use of Business Funds
- Unexpected Growth
- Low Sales
Step by Step Guide to Launch your Own Business
1- Write your Business Plan
A business plan it is just an outline of what you want to accomplish with your business and the basic steps that you will follow to get there. Many people have succeeded in business without having a business plan, but many more have failed just because of it. A business plan can be as complicated as you can make it, or as simply as you need it. At the beginning it can have 1,000 pages, or it may only have only two pages depending on your business and your need for external financing. It is basically the document that you can refer to when you are not sure what to do next, and it can help you avoid some of the issues that can cause your business failure by helping you remember why are you on business, and what business are you in.
2- What kind of business structure you need?
- Sole proprietorship
- Limited Liability Company
- S Corporation
- C Corporation
3- Location, Location, Location
As in Real Estate, one of the primary reasons for business success or failure is the location of your business. Depending on your business you may need to be in an area with high customer traffic, or it may actually need to be in an isolated area. Can you imagine what could happen if someone decides to put a Hair Saloon or Gas Station in the middle of nowhere, or if someone else decides to put a munitions factory in your downtown or backyard?. From traffic patterns, and zoning codes, to simply the actual cost/rent prices, having the right location can be the decisive factor in your business success or failure.
4- Finance your Business
5- Legal and Regulatory
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Inloso offers strategic business consulting in Latin America and the U.S., in the areas of multinational strategic business development, multinational operations, and entrepreneurship. We have over 20 years of experience and can help you expand your business, improve your profits and customer satisfaction, and/or reduce your costs of operations. Please visit our contact page if you are interested in our assistance in any of these areas.
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