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Top 10 Things to Know Before Starting a Business

Starting a business isn’t easy. You’ll have to prepare in order to run it well. Yet you don’t need to make the preparations difficult. What you only need is a little bit of knowledge of how to start your business right. Here are some tips you should consider when starting your business.

Starting a Business in the Philippines

10. Know your market

It’s important to know how business works in your chosen industry. For example, if you’re considering setting up a vegetable market, then it’s easy to establish the business right away, yet you have many competitors. On the other hand, if you’re planning a start-up, you should realize that it’s risky.

Knowing your market can help you plan ahead for your actions. It will also determine if you’re able to conduct the business.

9. Stock up some capital.

Depending on your business, you should get the capital you need. Different businesses require different amounts of capital. For example, a farm requires a larger amount of capital than a food stall. You also have to consider physical capital—non-cash capital in the form of equipment and buildings. It would be useless to set up a diner if there’s no place to start. Hence, getting the right capital is crucial.

8. Study your customers.

Customers drive people to do business. You should know what people like, and keep up with the consumer trends. If you’re starting a business that’s not in line with your customers’ desires, then it might flunk.

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7. Plan your expenses.

Create a plan on how cash is going to flow in and out of your business, so you’ll be able to spot warning signs. It will help you decide actions to control your cash flow.

6. Choose the right people to hire.

If your business needs workers, make sure to hire the right ones. Obviously, people won’t tell you if the person you hired is the right one; you have to find that out for yourself. Get to know them to see if they fit for the job.

5. Start small.

Some people make the mistake of establishing a large business instantly. Not that it will not work, yet it’s more prone to larger setbacks and more failures. If you’re starting out, especially for the first time, establish a small business first and see if it survives for a year. When it does, then that’s the time to grow your business.

4. Create connections.

It’s best to know people related to your business. They can assist you in starting your business. They can also recommend certain people who they know are good for the work. Most of all, It will certainly improve your people skills.

 

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3. Consider getting a loan.

If you don’t have the capital to start your business, then try availing a loan. Loans can help you start your business as soon as possible. However, take note that banks don’t give out loans easily. They’ll have to assess your plans first before they give you one. Also, a loan is riskier than using your personal cash. Thus, weigh your decisions carefully when getting one.

2. Focus on cash flow, not profit.

Before establishing your business, make sure you’re not focusing on the profit. In most cases, a positive profit doesn’t mean your business is doing well. You have to take into account how cash moves in and out of your business. You might make the mistake of starting a business when it shows a possible positive profit when in fact cash flows out readily.

1. Expect the unexpected.

Businesses always involve risk. Hence, you have to prepare yourself for any possible situations that may arise once you get yourself going. Have failsafe measures to prevent situations from getting out of hand.  Take advantage of the tools and apps available which can decrease the risks, by enabling you to automate and simplify your processes. One example is by using Taxumo, a very helpful app that can take care of your taxes for you.

Taxumo is an online web application which automates the preparation, filing and payment of business taxes of Micro and Small businesses, Freelancers and Professionals here in the Philippines. All you need to do is encode your income and expenses and the site automatically computes for your tax dues! Better yet, get started with Taxumo by signing up with our code WHENINMNL, and  get a discount on their plans, plus a FREE one month trial.

It may seem hard to start your business, yet don’t get discouraged. It will always involve risk, but with the proper preparations in hand, you’ll reduce the risk by a good amount.

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Dreaming of starting your own business? Let us hear your thoughts in the comments.