7 FACTORS TO CONSIDER WHEN STARTING A BUSINESS

“It’s not about ideas. It’s about making ideas happen” – Scott Belsky.

These lines might ring true when you’re embarking on the journey of starting a new business with a revolutionary idea that can help you bring a revolutionary change.

Just like every other entrepreneur, you wish that starting your business is as simple as it seems. But, the truth is that you might have 1,000 other things to work on simultaneously.

Like a recipe, which you cannot cook without the required ingredients, it’s challenging to start a business until you get all the things needed to start.

While starting a new business can be overwhelming and challenging, the entire process can seem worthwhile when you taste success.

To make your life easier, we provide a list of factors to consider when starting a new business.

Let’s dive in and explore.

Here are some factors to consider when starting a new business:

1. Know the data privacy laws

Data is essential for a start-up business to thrive. Data can give you insights into who your customers are and understand their preferences. While collecting data is imperative, they need to ensure data is under tight lock.

As a result, data privacy is more critical than ever. Knowing everything about data privacy laws like California’s Privacy Rights Act and Europe’s General Data Protection Regulation (GDPR) can help ensure compliance with the requirements set by the government.

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These laws set proper guidelines on how a business can collect, store and handle personal information from consumers. Non-compliance with these privacy laws can attract huge penalties from the state or federal government. 

For instance, in 2019, Google was fined €50 million due to non-compliance with GDPR. Due to the company’s inability to provide transparency, and the absence of valid consent concerning ad personalization, Google paid such hefty fines.

When you ignore data privacy during the early phases of your business, it might significantly impact your business’s functioning. Today, privacy is the key to establishing trust in your brand because customers prefer a business that ensures the safety of their data and personal information.

2. Know the cost of starting your business

Whether you’re starting a retail business or a boutique, knowing the cost of starting a business is essential to map your finances with your potential expenditure.

For instance, you might have to think about the cost of land or building, invest in POS or other equipment, and buy furniture and various other things to set up the retail store or boutique.

To understand how much it costs to start a boutique, it’s essential to understand the start-up cost you can incur. Some types of start-up cost to incur are borrowing costs, research costs, technology costs, insurance, and licensing costs, marketing and equipment, and supplies cost.

Having a fair idea of your start-up cost can help you finance your start-up business and collect the required amount of money.

Though every business has a unique start-up cost depending upon the business’s type, look at the cost of marketing, technology, licensing, and legal assistance.

Conduct thorough research and create a list of costs your business is likely to incur during the initial phase.

3. Audit the market demand for your business idea

While it’s easy to think you’ve developed an excellent idea that meets customers’ expectations and will revolutionize your market, conducting market research can help you understand your customers, competitors, and the industry.

By conducting market research, you can determine which products or services are in demand and how you can capture the marketing and increase your market share. When conducting market research, it primarily focuses on product or service evaluation.

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Another area where market research focuses is trend analysis, which procures data on the changing customer preferences using sales figures. 

This helps you assess consumer behavior and purchasing habits. Interestingly, market research has helped companies like Starbucks, Intuit, and GE enhance product offerings using customer recommendations.

Start-up businesses that want to grow require market research to establish themselves in their desired market.

4. Create a business plan

According to research, no business can develop fully without a business plan.

Today, with stiff competition in the market, writing a business plan can help determine if your idea is feasible and provide directions. A business plan can help you become a true entrepreneur who thinks in advance about the company’s betterment to ensure its success.

A business plan helps understand the next step your business should take to launch your start-up successfully.

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Your business plan entails what your competitors are doing and understand their strategies. It becomes easier to make appropriate business decisions about your company with this knowledge in hand.

You can create a much more effective strategy for your business and ensure you don’t face the same fate as the 90% of companies who fail within the first five years.

Apart from evaluating competitors and finding your audience, a business plan helps conduct necessary research, sets objectives for employees and managers, sets goals for you as an entrepreneur, determines when new employees are needed, and helps make critical business decisions.

5. Pick your business location

When starting a boutique or retail store, your location can be the key to ultimate success.

Why?

A good business location can reduce your expenses and is essential for business success. It might make or break your start-up business.

While it might be intimidating to choose a cheap location because of the rent and other factors, it might result in the desired results.

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So, when choosing a business location, demographics play a significant role in marketing your product as it can influence your choice of business location.

For example, if you are starting a boutique business, it might be beneficial to choose a location near a residential area. Also, consider the style of your business operation. For instance, if you are a high-end fashion brand, you might prefer a downtown or high-street area where people can visit and might not mind paying a little extra.

Other essential factors to consider when searching for a location are accessibility and basic infrastructure, zoning, permit issues, proximity to other businesses and services, and the image and history of the chosen location.

6. Market your business

Many business owners spend most of their time creating and developing the products, so there’s hardly any money left to spend on the marketing budget. Often, entrepreneurs spend too much time developing the product that marketing becomes an afterthought.

Regardless of whether you’re a retail store or boutique, having a web presence can help reach potential customers and increase the footfall to your store. Create a standard informational website and focus on optimizing it for SEO.

This way, potential customers can search for relevant and specific keywords and come to your store or boutique.

Also, focus on creating digital content to make it easier for customers or target market to find correct answers related to your product or services. Consider content marketing as an essential aspect of your day-to-day activities as it can ensure a plethora of benefits for marketing the business.

You can use your content marketing in conjunction with posting on social media.

7. Choosing the right timing

Another critical element of starting and building a business is choosing the right timing. Starting your business when the economy is healthy and your prospective industry is expanding can help you survive and grow.

Timing can be defined as launching the product or service at the right time in the right place. If your start-up arrives too early, you might not get the required traction from your customers.

And, if it enters late, you might lose out on customers because competitors already entered the market before you did. Your start-up might be easily forgotten both by your customers and potential investors.

Your timing to enter the market is the element of your start-up growth mix, which isn’t under your control. You can have an exciting idea, but it’s the time that can delude you and decide the success of your start-up.

For instance, many businesses thrived during the COVID-induced pandemic, while others miserably failed because the market wasn’t ripe for their business model. For a start-up to succeed, the idea and timing are essential.

When starting your business, you might see many doors getting slammed in your face and people trying to shut you down by pointing out some error.

A can-do attitude can help you rise above all of it.

Starting a business can be worthwhile and exciting, especially when you consider the necessary friction-causing factors.

It’s essential to put many things in place to prevent your business from collapsing before starting your business.

These seven factors can help you remove some potential bottlenecks and help you touch the sky in no time.

Author’s bio:

Priya Jain has been copywriting professionally for over eight years. She has attained an engineering degree and an MBA. She teaches math, spends her time running behind her toddler, and tries new recipes while she isn’t writing. You can find her on LinkedIn.