As many experienced entrepreneurs will tell you, there’s no perfect formula to start a small business. Sometimes the best advice for a business is to challenge your way of thinking. We recently spoke with several successful business owners and asked for their tips and advice on starting a business.
Tips for Starting a Small Business
It’s common to learn as you go when starting your own business. The more intelligent decisions you make at the beginning, the greater the chances of your business’s success. Try these 10 tips from our experts:
1. Address Excuses
Trevor Haywood, President & CEO of Haywood Hunt & Associates Inc., a private investigation agency headquartered in Toronto, shared the following insight:
Many people dream about becoming entrepreneurs but never become one. Many people are burdened by excuses and fear of failure. You can find a thousand reasons to not start a business, from money to time and responsibilities.
It’s scary to be your own boss. Most new business owners are unaware of their chances for success and have a lot at stake. It is normal to worry about the risks associated with business ownership.
Excuses will only hinder you from achieving your goals. If you want to begin a business you must address and eliminate the reasons that you believe you cannot do so. You should find a way to resolve the problem rather than letting it stop you.
2. Absorb Everything
The advice below was submitted and endorsed by Rupin Bal, a Punjabi criminal lawyer with Rupin Bal Law Professional Corporation in Toronto:
Listen to others’ opinions – friends, family members, experts and even you. Be a sponge when it comes to your entrepreneurial goals. Start to develop the idea as you learn. Note down everything. Take notes on all resources that you find to create a detailed plan.
Read their body language when you tell them about your startup. Does the person like your idea? Are they being nice, or do they really believe you are going in the wrong directions? Encourage your listeners be honest. You could get a good idea of consumer reactions by observing how your peers react.
Do not ignore the advice of experts and experienced business owners. These people know what works and what doesn’t. Smart entrepreneurs learn from mistakes made by other business owners.
3. Be a Solution
The following insight was shared by Danny Porter, the President of the Home Equity Loan specialists at Homebase Mortgages in Toronto:
Instead of starting with what you want to sell, start by thinking about what it will solve. When your company is solving a problem, it’s much easier to build a customer base. Your startup should be able to fill a gap in a particular market or niche.
Patriot Software was not created because I love software. I wanted to solve a problem that small business owners faced. After some research, it was clear that I could offer payroll software and accountancy software which are both easy to use and affordable.
Focus on the reasons you want to start your own business. Understanding your motivations will help create your brand and market your business. You should know what your customers’ problems are and how to solve them.
4. Keep it Simple
Lori Blair is the owner of the Toronto dog walking company Urban Tail. She shared her insight:
You may be like many other entrepreneurs who have an idea for a business and are ready to take it on. Don’t let your idea snowball into a complex project. You might end up with a costly, complicated product that no one wants.
Start small as a business owner and focus on fewer things. Test your business ideas. Create a quality, simple product or service. A successful business plan should exceed customer expectations and fulfill all promises made to them.
Reduce unnecessary features which will reduce your offering and cost you more money. You don’t have to be as extravagant as a large corporation. As your business grows, it will be easier to expand.
5. Calculate the Costs
The following advice comes from Toronto Criminal Lawyer Ahmad Karzai of Ahmad Karzai Law Professional Corporation:
Add up the costs of your business plan as soon as you begin to develop it. To launch and run your business, you will need to include all expenses. You should consider your location, rental, supplies, and marketing.
Then, multiply that number by four. Take whatever dollar amount you believe it is, and quadruple that. Quadruple the amount. Everywhere you turn, there will be expenses that are not expected. You’re better off being over-prepared than running out of money when the bills start rolling in.
Don’t forget your personal budget when you are calculating the costs to start a new business. Consider how much you’ll need for rent, food and gas, as well as healthcare. List these expenses in order from the ones you have to pay (e.g. mortgage) down to those that can be pushed aside if money is running out (e.g. entertainment).
Create a budget for your business once you’ve figured out all of your expenses. You may need some external capital at first to cover your expenses, such as a small-business loan. Before investing in a startup, consider all your options.
6. Imagine a World Where You Have No Money
AJ McPhee, the CEO of the Second Mortgage experts at Mortgage Central Nationwide, shared his insights:
I mean zero. This is highly likely to happen. I’ve seen several of my businesses fail over the years. I’ve been close to bankruptcy.
Many entrepreneurs have to face the reality of launching a business that fails. Over half of all new businesses fail in the first five years. What would you do if there was no money coming in?
You should have a plan “just in case” the worst happens. You may need to find a job quickly or temporarily move in with your parents. You may have to give up comforts you are used to. If your business plan fails, figure out what you’d do.
What are your current income sources? What is your current income? How long could you live on your savings if quit your job? What unplanned events could ruin your plan? (e.g. your car breaking down or your furnace breaking down) Prepare for the worst-case scenarios that may occur if your business plan fails.
7. Earn While You Build
We spoke with Mississauga family lawyer Malerie Rose and owner of Rose Family Law to get her insights:
Do not quit your job just yet if you are planning to start a business. A successful start-up is a long process. Build your business gradually and transition from employee into entrepreneur.
It will take time for you to establish a stable income as a new business. You can continue to work your 9-to-5 and then focus on the business in your spare time so that you are able to earn money during those difficult first stages. You can take on full-time business ownership once you’ve generated a steady stream of cash through your company.
8. Speak up About Your Business
Calvin Barry, a renowned Toronto DUI Lawyer, and owner of Calvin Barry Professional Corporation shared his insights:
Many business owners struggle with the problem of selling. When you’re a new business owner, it can be daunting to tell the world about your company.
You need to stop worrying about what others will think of your business. It’s hard to make money if you can’t get consumers to support and buy from your business. Not outgoing enough? Fake it until you make it. You can’t be timid if you want to succeed in business.
In my early years as an entrepreneur I had to give my first public speech. The first time I had to do public speaking was in my early days as an entrepreneur. I did not have any experience or training talking to large crowds of people.
If I wanted to see my company succeed, I had to step out of my comfort zones. It was in the planning and hosting of nearly 70 three-day conferences.
It’s impossible to describe how terrified I was. After speaking at conventions, I felt more confident in front of others. Although I was an introvert, I had to learn how to “put myself on the line” in order for my business.
Prepare yourself to talk confidently about your company, even if you feel uncomfortable. You will be required to constantly market your business and network as a new owner. Communication is key, whether you are networking with clients or negotiating payment terms with suppliers.
9. Start a Small Business Legally
We recently got this advice from Michael Caride, the owner of the Toronto SEO Company Brushfire Marketing Solutions:
It’s exciting to start a new business. The laws are not exciting. You need to know the rules associated with starting a business. You could be subject to harsh penalties if you do not follow the government’s regulations.
You must obey the law. Register your business with the state. Ensure that you are aware of business tax obligations. You must also follow the laws governing employers as you hire employees.
You will have different rules depending on where you live, your business structure and industry. As you start your business, talk to a small-business accountant.
10. Balance Passion with Wisdom
Passion is one of the key ingredients to a successful business. Passion will drive you to constantly improve your processes so that your business grows.
Don’t let your passion dictate all of your decisions. Knowledge will guide you to the right path, while passion will propel you forward.
Talk to your target market and conduct a market study to determine the potential of your business. Ask questions to experts about starting a business. Contact professionals who can assist you in certain business areas, such as lawyers and financial advisors.
Imagine that your business is like a car. Let your passion be the accelerator and your mind the steering wheel. You can then be sure of your direction and maintain the momentum needed to reach it.
