5 Questions to Ask Yourself When Starting a New Business

Opening a business has become a way for individuals to make a living amid recessions and rising unemployment rates. More than that, it has become an avenue to turn experience, hobbies, and passion into profit. You may be wanting to open your own business too, but just don’t know where and how to begin. To kick-start your business, ask yourself these questions first:

1. Why are you starting a business?

Business is an exciting route to financial freedom, but there are a lot of challenges entrepreneurs have to go through. This is why it’s important to ask yourself, before anything else, why you’re starting one. List concrete reasons that won’t change after the excitement has passed. Make sure your reasons aren’t shallow ones either, like “everyone’s doing it” or “it would be nice to be an entrepreneur”. After all, business is a commitment. If you don’t have a solid reason to ground you when external factors pull you in different directions, it can cost you what you invested and more.

2. What will your business be about?

The next step is to plan out what your business will be about. It might seem as simple as just picking out what seems interesting or plausible, but the best businesses are founded on sound planning and research. If you already have a product or service in mind, you can do additional analysis on whether or not it’s feasible and profitable as a business. If you don’t know where to start, check for trends online or consult experts who have been doing business in the same industry longer than you.

3. How will you operate your business?

You also have to plan how you’ll operate your business. Ask yourself if it’s more beneficial to run your operations by yourself or with a whole team. This, along with the details of your product or service, will have to be formalized into your business registration documents. If you are filing to become a limited liability company, then you will need to register your chosen name, articles of organization, and operating agreement with your state. These documents should outline the basics of how your business will work, including how management decisions will be made, what the ownership structure is like, and how you are legally protected against any liability. Ironing these out will form the backbone of your business and its operations.

4. Who will your customers be?

In the beginning, it may be easy to say that you want to do business with everybody. However, it is best to determine who your product or service is primarily for. Pinpointing who your target customers will be will help focus your efforts and optimize your marketing approach. It will show you when, where, and how you’ll talk about your product and service so that people truly understand it. If your efforts are clear and your target customers see the value in what you can offer, then they are more likely to do business with you.

5. What are your goals?

Lastly, you have to ask yourself what your plans are for the business moving forward. These will guide your daily operations and decisions. As a leader, these goals are also what you must share with the people you’ll work with. One skill any good entrepreneur must have is the ability to communicate and imbibe their vision to other members of their team. Knowing where your business is headed and what you’re working towards will make you appreciate all the hard work you’re putting in and encourage you and your team to work harder.

How you answer to these simple questions will serve as your new venture’s jump-off point. If you aren’t sure about the answer to these, it’ll be easy to quickly lose direction, in turn increasing your chances of failure. On the other hand, when you have a clear grasp of your business’ purpose, plans, vision, and goals, then the route ahead will be much easier to navigate, and growth and success will follow.