A business plan contains the key elements to help the entrepreneur to succeed. It serves as a tool for stirring the company through various expected challenges, and ensures the company remains focused in meeting its financial objectives.
Investors expect a business plan to answer key questions on; the viability of business model, the market opportunity, capabilities of the management team, and the required financial resources. Our business plans are tailored to each unique situation.
If you’re targeting upcoming and trending niches, timing is everything. Wait too long and everyone jumps on the bandwagon, leaving the market flooded with competition. But if you can strike at the right time, you can establish your brand as a niche leader before all the copycat brands hop on.
Based on search trends and expert recommendations, we’ve collected a list of the top 10 best niche products for 2020.
Eco-friendly Versions of Everyday Products
Climate change has been on everyone’s minds lately, including online shoppers. To support environmental efforts, lots of new manufacturers are creating eco-friendly versions of everyday products.
One of the fastest rising products is reusable food wrap like Lilybee Wraps, which aims to reduce single-use plastic wrap with cleanable (and prettier) food protection. Another niche to go environmentally conscious is feminine hygiene, with eco-friendly pads like Lunapads seeing more and more interest (as the site claims, each one replaces over 125 disposable pads).
This is a popular and wide-ranging niche, one with plenty of sub-niches that you can further hone in on. The beauty of eco-friendly niches is that you can accommodate them for every industry, even if just a few products. Almost every type of store has environmental versions.
Preplanned Meals and Ingredients
Somewhere between the need for convenience and eating healthy, a unique ecommerce niche starts to bloom. Preplanned meal delivery — which sends prepared ingredients to your home, ready to be cooked by you — is projected to rise substantially in 2020.
The appeal of services like Plated is the convenience of not having to shop for your own meals, but also avoiding the unhealthy choices that dominate delivery by cooking it yourself. Again, this niche is wide enough to support plenty of sub-niches, like specializing in a certain type of cuisine. Part of the appeal, though, is having meals selected by professional chefs.
To some it’s fashionable, to others it’s just a modern girdle. Regardless, tight-fitting fashion items that grip the body to accentuate curves, known as shapewear or bodycon (“body conscious”), are hot sellers.
Fashion is always a niche industry divided by personal taste, but adding body image preferences makes it even more niche. You have to make sure your shoppers will be into these products if you offer them, or else you risk offending them. But if it sounds like something your shoppers will like, the website of Macom explains how the clothing works.
weight loss niche
Weight Loss Items
On the heels of body-shaping garments, there’s other trending niches that take a completely different route to arrive at the same, slimming results.
Specifically, cellulite removers are on rise, namely those that use sonic lift technology. Although the results are inconclusive, brands are marketing these massagers as the long-sought solution to the age-old problem of cellulite. For more details, check out niche leader Glo.
Aside from this new product, you can still offer the basic evergreen items like keto supplements or home gym equipment.
POD Clothing and Apparel
With modern technology, retailers are no longer chained to the model of storing inventory. One such advancement is Print on Demand (POD), which is likely to upset the low-end apparel market in 2020.
POD clothing and apparel lets you target any variety of different styles, allowing you to really hone in on your niche. Because the apparel industry is already dangerously saturated, it’s best to dive deep into a niche to reduce competition — fitness clothes, ironic T-shirts, animal prints, etc. Take a look at Redbubble’s POD selection for inspiration.
The market for smartphones and other mobile devices is reaching unprecedented levels — enough to support smaller submarkets like the smartphone accessories. Not everyone owns a smartphone, and not every smartphone owner buys accessories; but there’s a specific niche of people who want to deck out their smartphones and make them more efficient.
Although there’s still enough demand for traditional smartphone accessories, what we’re seeing now is some “next-level” tech for consumers who want a little extra. For example, BodyGuardz tempered glass screen protectors offer more protection than the normal flimsy plastic guards. Likewise, rather than deal with the usual cord charging, consumers are predicted to buy more wireless charging stands in 2020.
Marijuana and CBD Products
Talk about niche — this entry is downright illegal in certain places. But if you live somewhere where cannabis is legal, you have a lucrative opportunity to participate in one of the most profitable ecommerce niches of the 21st century.
Cannabidiol (CBD) oil is a medical product proven to remedy pain, anxiety, cancer-related symptoms, and even acne! Because cannabis legislation is fairly recent, the medical marijuana and CBD industry is one of the best niches to break into at the moment.
CBD products are legal in most places across the U.S. and might be a great starting place while you wait for the other stuff to iron out.
Just be careful about which channels and payment gateways you use, as some don’t allow cannabis sales. While there are obstacles, CBD Essence proves that selling CBD online is both doable and profitable.
Well over a year ago on the ecomdash blog, we posted 5 Exciting New Technologies for Online Retail, where we cited drones as an “Honorable Mention” with the caveat that it still needed government regulation. Well, as of October 2019, new commercial drone approvals are starting to come in, suggesting that drones and their accessories will be one of the trending niches of 2020.
The likely course of events will see drones first authorized for deliveries (like UPS’s recent permission) and then more options for commercial hobbyists will enter the market.
Just like with smartphone accessories, there’s a niche of consumers who want to customize their cars with new tech and gadgets. One of the most common are rear cameras, which actually make driving safer.
Likewise, smartphone holders are on the rise, as more drivers are opting for their device’s GPS over those built into the cars. These are relatively cheap too ($1 – $5), making them a risk-free addition to most stores.
Handmade & Minimalist Jewelry
The fashion industry historically popularized the luxury brand and exclusivity models, but in our modern economy, more shoppers are flocking to handmade and minimal jewelry. For one thing, the more affordable prices appeal to younger customer groups, but really it’s a stylistic preference that’s pushing this fad. At the moment, simple jewelry is “in.”
Keep in mind that minimalist jewelry isn’t an untouched niche market, it’s just recently seeing more attention. The truth is this niche is already old and established, and even has its channel Etsy dedicated to it. If you’re a fashion ecommerce seller and want to break into this niche, you’ll need to spruce up your social media skills, especially Instagram — that’s where all the serious marketing for simple jewelry is done.
Getting and staying motivated is vital, whether you’re striving to reach a business goal, starting a new venture, or managing the day-to-day operations of your business. Lack of motivation can chip away at your confidence and hurt your potential for success. The more motivated you are, the more forward-moving momentum you will create and the easier it will be to tackle ambitious goals and reach higher levels of success in your business.
Entrench Yourself in a Goal While lack of motivation may not be related to a specific goal, having a goal can often help you get motivated. SMART goal setting is one way to outline your objectives, clarify the importance of the goal, and create an action plan for achieving it. If you are able to break down long-term goals into weekly or even daily action steps, the progress you make every day can help you build momentum and get motivated to keep the process moving.
Relive Past Successes Do you remember what it felt like to reach an accomplishment, hit a significant milestone or make an important decision? Spend some time thinking about the process you went through, the work you put in and the taste of victory. Reliving some of your best moments can get you over the hurdle and into action.
Find Inspiration in Someone Else There will always be others who have walked the path before you, faced challenges and emerged victorious. Spend time appreciating the drive and determination of others, and explore how they overcame the challenges they faced on their journeys. This can be motivating, while also giving you some creative ideas for getting through the challenges you’re facing.
Try a New Approach Progress often generates routines; routines can bring boredom; and boredom can cause a loss of motivation. If your routines are causing you to lose your fire, it may be time to shake things up. Try altering the way you do things, when you do them, how you do them and even how you think about them. Start to question your standard processes, and introduce a new way of thinking to get past complacency and renew your motivation.
Find an Accountability Partner Having someone there to encourage you, support you and challenge you can be an effective way to get and stay motivated. When you make a commitment to someone else to do something, you’re no longer struggling along on your own. You have someone else counting on you, and most of us feel increased motivation to act when there is a chance we will disappoint someone other than ourselves.
Psych Yourself Up Ultimately, although some of these methods rely on external sources, motivation comes from within. The best way to get motivated is by figuring out what psychs you up and gets you moving. You can try your favorite music, positive thinking, celebrating success, and creating a personal mantra. When you’ve found an activity that results in a boost in motivation, and makes you excited to take the next step, you have found your own motivational secret to get over the slump.If these ideas don’t successfully help you get you motivated, spend some time exploring what gets you excited and ready to get the work done. Everyone has a trigger that will push them into productive mode. It may take a little trial and error to find, but it is there if you take the time to look.
It can seem very difficult to get the loan you need with reasonable terms if you have bad credit. It may feel like the whole world
is working against you. Thankfully, all hope is not lost. There may be a way you can borrow money even with bad credit.
Tips to get a loan with bad credit While you might not be able to get the ideal loan by yourself, you may be able to get the loan you need with a co-signer who has healthy credit. Alternatively, you can work to improve your credit to increase your chances of getting a loan in the future. You can also consider nontraditional sources to borrow the money you need. Below, we share tips to get a loan with bad credit.
1. Check your credit reports and credit scores “If you don’t know where your finances stand, it’s best to do some personal digging to figure out what’s in your accounts,” says Cody Green, co-founder of USA Drives. One way to find out what you owe on your current credit cards is by checking your credit reports (if your credit card issuer reports to the consumer credit bureaus). Checking your credit reports is important because some of the information contained in them is used to calculate your credit scores. You’ll want to make sure there are no incorrect derogatory marks on your reports before applying for a loan. The three major consumer credit bureaus — Equifax, Experian and TransUnion — aren’t perfect, so it’s important to read your credit reports carefully. If there are false negative marks, you should contact the specific credit reporting company generating the report along with the information provider to get the error removed. Knowing your credit scores is important, too. Your credit scores, along with other factors, such as your debt-to-income ratio, can affect your approval odds for a loan and the terms you qualify for. Don’t be discouraged if your scores are not what you’d like. A little bit of work could help put your scores in better shape.
2. Improve your credit health
Once you have a better idea of your credit, it’s time to start improving your credit health.Your credit scores are calculated using different credit factors and scoring models. Try to focus on the factors with the most impact, like payment history,
but do your best to improve your credit health overall. Factors that can impact your credit scores include …
Payment history: While you can’t change the past, making all of your current payments for at least the minimum amount and on time is key for this portion of your scores.
Credit usage: Do your best to keep the amount of debt you owe low compared to your total credit limit, ideally less than 30%. Maxed-out or over-the-limit lines of credit can be particularly harmful.
Length of credit history: Keeping old accounts open instead of closing accounts after they are paid off can help increase your credit history length.
Credit mix and types: While you shouldn’t apply for a new type of credit to influence this portion of your scores, it can naturally grow over time as you experience major financial events, such as buying a home.
Recent credit: Opening or applying for several new credit accounts in a short period of time can make you seem risky to lenders. Opening new credit accounts only when necessary and when you know you can handle them responsibly is usually the best bet.
3. Shop around with multiple lenders to compare options Once you’ve worked on improving your credit health as much as possible ahead of applying for a loan, it’s time to start shopping around for the best loan for you. While some people may simply choose the first loan they’re approved for, that could be a major mistake. Different lenders may offer varying interest rates and loan terms depending on their assessment of your creditworthiness and risk. Lenders have their own methods for evaluating these factors. “While there is a selection of lenders and loan facilitators who can help low-credit applicants obtain affordable and reputable financing, not all loan features are created equally,” says Green.
For example, one lender may offer you a loan with a 20.99% annual percentage rate while another can offer you a loan with a 16.99% APR. If you don’t shop around and accept the first offer of 20.99% APR, you would be overpaying by 4 percentage points.Common
What is an APR?
APR stands for “annual percentage rate” and is a numeric representation of your interest rate. For loans, the APR can include fees you may be charged, such as loan-origination fees.
Shopping around for loans is easier than ever today thanks to the internet. While you should still check into your local options, such as banks and credit unions in your area, you can easily view the estimated loan terms of various online lenders in one place using this tool.
4. Know the different types of loans you can consider
The types of loans you want to consider will vary based on your goals, but there are two major classes of loan products.Unsecured loans, such as personal loans, can be used to refinance high-interest-rate debt, finance an
unforeseen expense, or cover most other expenses you may want to finance. However, unsecured bad-credit loans usually have higher interest rates than secured loans and can be more difficult to obtain.
Secured loans, such as a home equity line of credit, are secured by collateral and may provide you with an alternative to an unsecured loan at a lower interest rate. However, secured loans put your collateral at risk of being repossessed if you don’t repay the loan as agreed. These loans can be easier to get than unsecured loans. Whether you decide to apply for a secured or unsecured loan, you may want to consider loans that allow a co-signer. If you’re able to find someone with healthy credit to co-sign a loan, you may be able to secure a lower interest rate than by simply applying for the loan in your name alone.
5. Understand the types of loans to avoid If you’re in the market for a loan, you should evaluate your finances to see how much you can afford to borrow responsibly. But even if you desperately need access to money, there are some types of loansyou should do your best to avoid. For instance, payday loans and auto title loans often have short terms, high interest rates and high fees that can harm your finances. When evaluating a loan, try to avoid loans that have high origination fees, steep fees or interest rates, and extremely short loan terms. These types of loans may aim to take advantage of people who desperately need money and have few other options.
Getting access to the money you need with bad credit may seem difficult, but it isn’t impossible. You’ll want to become familiar with your credit scores and credit reports, and work to improve both to the best of your ability before applying for a loan. When you’re ready to apply, make sure you shop around to find the best possible loan for your situation. Finally, if all else fails, don’t forget about nontraditional lending options, such as borrowing from friends and family. Now that you have the tips to get a loan with bad credit, you can start working toward the loan you need and managing debt responsibly so that you can help improve your credit health.
Do you stop what you are doing to assist a coworker with advice or a problem? Do you answer your phone on the first ring…every time? Does your schedule look like a tangled web of events that all blend into one giant mess? Do you always feel tired and can comfortably say you are “burning your candle from both ends?”
If you answered yes to all of these questions, then you are the epitome of a yes man. Last time I checked, “yes man” is not in suffix category on an application; therefore, it’s not a term that should define you.
Essentially, a “yes man” is a people-pleaser. You tend to always put others’ needs before you own, at your own expense. It’s not a glamorous job. Unfortunately, becoming a people-pleaser is actually a dangerous path, as it can affect your physical, mental and social well-being.
We have probably said yes more than enough times and it has caused us stress. However, if you feel that you are saying “yes” without even blinking an eye like Jim Carrey, maybe it’s time to reevaluate how you view your options.
Say no. Easier said than done, right? If you want to change how you live your life, start by making your own decisions.
Below are 10 great ways to start you on the path to your own success and happiness.
The Power of “No”: 10 Ways to Avoid Being a Yes Man
1. The Power of Choice
Many people struggle with addiction. Believe it or not, saying yes to everything is also an addiction. Often times, our guilt, fear and anxiety rule our minds when we say no. It’s like going through a sort of withdrawal. You crave the need to please everyone, no matter the cost.
Much like coping with an alcohol addiction, the first step is recognizing that you have a problem. In this case, recognize that you have a choice. You can say “yes” or “no.” Instead of feeling trapped, consider other options and weigh what is best for your well-being.
2. Know Your Priorities
Put yourself first. This may seem like a selfish notion, but in actuality, you are practicing living a healthy lifestyle. Consider what the most important thing for you to focus your energy on and give it all you’ve got.
Make a list of tasks or schedule some downtime and follow-through with your plan. You’ll feel more satisfied and rejuvenated.
3. Think Before You Answer
Most questions or favors asked of you do not require immediate attention. If they do, see if the timing is appropriate for you and determine if you need to be directly involved. It’s okay to tell your friend or colleague that you need some time to think about it. You’ll grant yourself the chance to step away from the immediacy and pressure and have time to evaluate the pros and cons of your decision.
4. Embrace a Mantra
Develop a saying that you repeat over and over to yourself. It can remind you to say no or consider your priorities first. Make sure that your message is positive and only propels you forward. Envision your mantra multiple times every day, and before you know it, this practice will become a good habit.
5. Don’t Fall on the Defense
You don’t need to provide an excuse or reason to defend your decision. More often than not, your reason is your own business.
Like a mother telling their child, “because I said so,” is answer enough. You were given free will. Embrace it.
6. Never Apologize
This isn’t a “get out of jail free” card. If you were at fault, of course you need to apologize. However, this goes for the yes men that say sorry for every decision they make. Don’t feel the need to feel guilt about your decision. This will only promote anxiety and unwanted stress.
7. Develop an Assertive Tone
Going along with never saying you’re sorry (unless there’s reason), be confident with your choices. Remind yourself that you have a good head on your shoulders and you will weigh your decisions and logically sort through what is best for you. Once you decide, go confident in your answer and remain firm. No backsliding.
8. See the Good in Saying “No”
Don’t always see saying “no” as letting down another person. See it as an opportunity to do something to make you happy and focus on your wants and needs. You will start to notice your schedule will slowly clear up.
9. Don’t Be Afraid of the Aftermath
Never dwell on what people think about your decision. Chances are they’ve moved on before you have. Fixating on your answer will cause you to stress and worry too much. Let it go.
10. You are Only Human
At the end of the day, you can’t please everyone. So, instead of trying to be a superhero, try to assess your priorities and put yourself first.
Each year many people want to go into entrepreneurship or simple want to start their own businesses. Financial independence, having more time to do the things that you love and being able to take control of your own destiny are some of the reasons often cited. While some first time entrepreneurs may have a clear idea on the kind of business they want to start, a number may not. Getting a business idea is all about identifying opportunities in the market, and matching them to your core competencies and interests. You can follow well laid out processes championed by entrepreneurship gurus or do what works for you. Nevertheless there are some tips to help you.
Try to find out the things that interest you most
While the potential financial rewards are some of the main reasons why someone will want to start a business, passion is key to sustaining a business and taking it to new level. One of the first things you want to do if you want to enter into entrepreneurship, is write down a list of things you like doing e.g. snowboarding, keeping pets, cooking, meeting new people, travelling etc. Along this list, write down things or situations that you do not like. You may not enjoy such as speaking in public, long distance flights, packing clothes etc. Having done these two lists, try to ask yourself, “if there were three or five products or services that will make my life more fulfilling, what could they be?” At the end of this process you should be able to have a clear idea on what area/sector your business is likely to be based on your interests.
Browse hottest trends
You can browse for products and services trending, based on your identified area of interest. There are a number of online tools to help you do this. Google’s keyword finder and news trending are some possible sources. Trending topics can give you an idea of what people are buying or are searching for.
Test the idea
Once you have a clue about the kind of business you want start, entrepreneurship experts advise that you try to test the idea. For this, there are so many tools to do so. Create a prototype of the product or service and write down as much as you can about. Find a way in which you can approach the target group and get their opinions about your business idea. This could be in the form of a questionnaire, product testing sessions, making cold calls to prospects etc. If done properly, you may get even get ideas on how to improve the product.
Be Open Minded
Sometimes business ideas can come from the weirdest places or situations. For instance, you visit a local pizzeria at peak periods and realize that there is long line of people who are waiting for their orders. This could trigger an idea to develop an app, whereby customers can order their pizza, whilst still at work or hours in advance, and will simple pass by the shop to collect. This could improve customer satisfaction and boost the company’s revenues. You may expand this concept if successful to other areas.
Thinking of going into entrepreneurship, then its best to just make the leap for it.
If you own a credit card, there is a high risk that you could pile on so much debt that you may find difficult to repay. Defaulting on your loans mean that it would be difficult to borrow money to cover essential items in the future. Fortunately there are tips available that you can follow to help you manage and stay in control of your credit cards.
Always have cash available to cater for emergencies
Often people build up credit card debt because they had to attend to emergencies such as sickness, loss of property etc. that there were ill-equipped for. As a result, they end up relying on a credit card to fund such unforeseen expenses. Try to establish an emergency fund that you can tap into in such situations. It could be in the form of a fixed interest savings account that you can only get access to after a certain period. Better still, you may want to sign up for an insurance policy that caters for different situation.
Live within your means
The fact that it is a credit card, does not mean you have unlimited amounts of money to spend. There is always temptation to engage in unnecessary spending habits. You need to always treat credit cards as any other types of debts. Debts which you have to pay later, and with interest. Only use a credit card to pay for essential otherwise, stick to a cash budget as much as possible.
Avoid carrying on balances to new credit cards
At some point in time you might decide to opt for another credit card, either because it offers better payment terms, has higher spending limit etc. It is important that you do not transfer outstanding balances from your previous card to the new one just for the sake of doing so. Try to establish if such a move may result in you paying lower interest overall or improve your credit worthiness. Nevertheless, it is always better to settle any old balances before taking on new debt.
Be up-to-date to date with your payments
Whatever conditions that you might have signed up to with your broker, you need to honour them. This includes payments that you agreed to make to settle your outstanding balances. There is a temptation to forego payments when you are facing financial troubles. However, this would come back to haunt you through late payment fees which only drag you further into more debt. If possible try to settle your balance in full at the end of each month. This way you stay in control of your credit card debts.
Detect signs of trouble earlier
You may never know how much you are in credit card debt until it is too late. Before things get worse, there are some signs that could give you clues such as:
Using credits card to meet recurrent expenditures. Credit cards should be used as a last resort, but should you find yourself relying on them to pay bills or meet everyday expenses like food then you could be in trouble
Ignoring or postponing payments. Should you find yourself constantly postponing when to pay your balances or do not feel like opening those monthly statements then those are not good signs
Credit card debts keeps piling up and you have no plans on how you are going to pay. In such a situation, it is important to seek help and try to stop this dangerous cycle before it is too late.
Do not take cash advances
The moment you find yourself having to use your credit card in order to take a cash advance that itself spells trouble. That is not to mention the tough terms that come along with such debts such as high interests and short repayment time. It is important you try to build up savings in order to avoid taking on cash advances to pay for unforeseen expenses.
Never lend your credit card to someone else
Your credit card should be your own personal property as you are liable for all amounts incurred as a result of using. It is not a good idea to lend it to somebody else, even if that person promises that he is going pay the bill. An important question that you must ask yourself is why that person can’t get one of their own. If he/she cannot be trusted by the credit card company with one, why should you?.
Read the fine print
Many times people fall into credit card debt because they did not pay enough attention to reading the small fine print before signing. Be aware of how the interest charges are done, when you need to make payments and related penalties etc.
Avoid taking more credit cards
Do not take new credit cards unless you really need to. The more credit cards you have the greater the chances of slipping into debt. Only take a new credit card if it offers certain advantages that are to the benefit of your financial health.
Set a budget and stick to it
Control spending with your credit cards by establishing an expenditure in budget. If you stick to it, you will avoid all sorts of unplanned expenditure you do not have any use for.
Compare credit cards for free. Learn the options available if you have poor credit, and start building good credit!
People have various reasons for wanting to start their own business; to liberate themselves from their boss, get rich instantly, fulfill a lifelong dream etc. Whilst most of these reasons may be very noble, what most entrepreneurs do not understand is the amount of work, time and commitment that they will need to dedicate to see their business succeed. This article highlights some of the challenges new businesses face and gives well-researched advice to entrepreneurs on how to deal with them.
1.Understand the different business formation types
It is important from the start, to decide on the legal formation of your company. This has implications on the kind of business activities you can carry out and how easy it will be for you to attract outside investment.
2. Ensure that your company has people with the requisite skills
Having chosen the right legal formation, you need to ensure that your company has people with the requisite technical skills for the sector that you specialized in. In addition to technical skills and knowledge of the industry, managerial skills are also crucial. Having an MBA is not a guarantee for the success of any business, but it is important that entrepreneurs have a firm grasp of key concepts in areas such as finance, marketing, marketing, selling, managing employees etc. Many start-ups have gone under as a result of poor management. The earlier you recognize key skills gaps, the better for your business. In today’s digital age, upgrading your skills has never been much easier. There are lots of online management courses you can take that are reasonable priced or contact a local institution of higher education nearby, they will often always have courses for professionals interested in upgrading their skills.
Another route is to seek professional help. There are many companies out there offering consulting services for small businesses. It is important to familiarize yourself with the areas that each consultancy specializes in and see if that is exactly what you need.
3. Improve your cash-flow
It does not matter how much money is coming into the business, if you don’t have enough to keep you going. You have suppliers to pay, staff who expect wages every month, rent to pay and so on. Some tips to improve your cash flow include:
The importance of forecasting cannot be underestimated. Start with the money you have right now, then list all your anticipated incomings followed by all your anticipated outgoings. Don’t overestimate incomes and underestimate outgoings – although your cash flow forecast is never going to be set in stone, be as realistic as you can be and if anything be conservative.
Be tough on terms
Late payments are a perennial problem for small businesses; a majority of them will experience late payments on a regular basis causing real problems for their business. Clearly state the payments terms and make sure your customer understands them; after that chase them as soon as soon as they exceed their limits. Before setting your terms when you pick a partner to work with, make sure you check their record, are they a reliable payer? Find out as much as you can to avoid them being responsible for your cash flow hitting choppy waters.
Reward your good customers
To avoid the nightmare of constantly chasing late payments reward your customers who actually pay you on time. This practice may impact your profit margin but it will help your management of cash flow, by giving customers an incentive to pay early rather than late.
Accept credit cards
This may cost you processing fees but it will ensure that you do get paid and it will leave out the hassle of having to chase late payments.
4.Get a Good Accountant
Quite a number of new start-ups have gotten into trouble as result of getting bad accounting advice. When starting a business there are lots of unqualified people willing to give you advice on a whole lot of things; from how to manage your taxes, get a credit line or how to manage your supplier relations. To run a successful business you need to seek professional advice. Understanding the legal instruments on how to file your tax returns or how to reconcile your bank balance may prove too cumbersome for most start-ups. That is why you need the help of a good accountant in order to ensure that you making the best decisions with regards to managing your company’s finances. A good accountant will advise you on what records you should be keeping. Most start-ups cannot afford to hire an in-house accountant to manage all the company’s finances. However it is possible to outsource your accounting needs to a reputable Accounting consultant. The prices charged are very reasonable. As a business owner you have the option to contract them on a one-off basis e.g. when tax returns have to be filed or for a long term relationship.
5. Have the right motivation for starting a business
It is not uncommon to hear many new entrepreneurs saying that the driving force for them starting a business is to make money, spend more time with their family or be their own boss. These reasons may not be a bad thing per se, but much more holistic and well thought motivation is crucial. Starting a business without the right motivation will see you quickly being frustrated and giving up. Passion for your business idea will see you through the worst of times as a start-up. Besides having the passion for your new business venture, you need to be a person who thrives on being independent, one who is able to take initiatives, and is willing to make tough decisions where needed.Many start-ups are over optimistic about the prospects of their business. They have unrealistic expectations of sales performance. At the same time they underestimate how much money is needed to keep the business operational until it is able to sustain itself. Thus many fail.
6.Have a Good Marketing Strategy
Knowing and understanding the basic principles of marketing is crucial for any small business. A start-up may have a great product but without a marketing strategy, it is doomed to fail. You need to be able to convince people to purchase your product or service. The chances that there exist a product that is similar to what you offering is very high, thus you need to able to convince customers on why your product is superior. From the start, know what your value proposition is and think of creative ways of how to communicate it to the market. Researching on the market for your products and doing an in-depth study of your competitors is crucial to coming up with a good marketing strategy. Focus groups, questionnaires, interviews are some of the tools often employed to find out what prospective customers think about your product. Before starting up any venture it is important that you understand the whole market and how your business model fits into it. Quite a number of small businesses decide to focus on serving a niche market. Whilst this has its advantages based on the fact that there is less competition, sometimes the niche may be too small to sustain your business.
Along with a marketing strategy, you need to come up with a promotion and communication budget. It is possible to allocate a fixed portion of your sales every month for marketing expenses or decide this as per need. The budget takes into account the marketing activities planned e.g. whether you will go for more expensive over the line activities or opt for less expensive under the line marketing which is more specific and targeted.
7. Think through the Business Model
The business model is at the core of any successful start-up. Taking your time to think through your business model helps you answer very difficult questions about the viability of your business. Having done an extensive market research, you will have a clear picture of the kind of market segments your business is targeting. However the success of any business model is dependent on fully understanding the unique needs of your market segments. Thus it is then possible to come up with the best possible method on how to reach them.
An important question that an entrepreneur has to answer is how easy it will be to acquire new customers and whether the cost of acquiring new clients surpasses the value that there will generate in the long run. Device a formula or adapt one that already exists for computing your customer’s lifetime value and cost of acquiring a customer.
CAC = Cost of Acquiring a Customer
LTV = Lifetime Value of a Customer
Another important aspect of the business model is your revenue model. Are the ways by which your company generates revenue sufficient to make it viable? This is an important question that needs to be answered in the planning phase of your company.
8. Choose a good location
Having your business in a good location can make up for poor management skills in a start-up, whilst with even the best of business manager, a bad location will see the demise of your business. A good location means that you are close to your target customers, your business is highly visible, and is easily accessible e.g. good road linkages, availability of parking space etc. Start-ups can also benefit from government subsidies which are targeted at encouraging development and employment creation in certain disadvantaged and distressed areas or aimed at encouraging entrepreneurship. Having knowledge about these programs before deciding on a location for your business could be something to consider.
Working from Home
Working from home may sound like an attractive prospect but you have to think through all the practical issues. One needs to be knowledgeable about issues that come about with working from home and make arrangements on how you will manage administrative issues such as taxes, health insurance etc. Consider taking out permanent health/accident insurance that will pay out a regular income if you are unable to work because of an accident or serious illness. Working from home means that you can be easily be distracted by so many things. Try to avoid these distractions and dedicate a certain part of your house to work, so that you can concentrate fully on work.
9. Keep a Check on Debt and Manage Personal Finances Separately
The euphoria surrounding any startup mean that there is the temptation to take on easily available credit to fund operations. Whilst this may seem attractive, it is quite risky. As a new business you face so many uncertainties thus saddling yourself with debt from the start is the last thing that you will want to do. It is advisable to use equity capital to finance your operations for as much time as possible and avoid any sort of debt.
Raising more finance, either through getting on board more investors or accumulating extra debt, will not make up for a poor business model. The debt to equity ratio is a simple formula used to measure how much of your business is financed by debt relative to owner’s equity. The formula below shows how it is calculated. Debt to Equity ratio
In addition to keeping your debt in check, it is vital that you maintain good relationships with your lenders. Try to always pay all bills on time and should this not be possible advise them earlier before the date the money is due. For startups a bank guarantee from the government is possible. This should allow you to be able to borrow money from your high-street bank to fund your business activities without offering your personal property as collateral.
As a startup, one of the problems you will encounter is how to separate personal financial transactions from business related transactions. This may prove to be very difficult especially if you are starting up as sole-proprietorship, personal expenses always get mixed up with business expenses. Dedicating a bit of time each week to administrative tasks such as, billing, recording expenses, keeping track of all your creditors and people you owe money, recording all sales etc. is important. From the start, understand the importance of separating personal finances from businesses finances. Filing tax returns or separating personal debt from business debt may prove cumbersome. Small businesses are eligible for certain tax incentives and legal protection. Keeping your books in order will help you take advantage of these schemes. Four things that you can do to avoid mixing your personal expenses with your business expenses are:
Open separate bank accounts; have a separate account for your business and your personal expenses.
Pay yourself a salary; when you starting up especially as a sole entrepreneur, try to allocate yourself a salary and stick to it. This eliminates the need to dip into company funds to fund your personal expenses.
Keep detailed records of all income and expenditure and have your accountant advise you
10.Avoid Bad Pricing Strategies
Though not often mentioned, poor pricing policies have seen many startups go under. Most new entrepreneurs with little knowledge on pricing often opt for the cost-based pricing approach. This entails simply calculation all the indirect and direct costs of producing a good or service and then adding a markup. Whilst this is one of the easiest and most logical way to price your products, it does not sufficiently capture the value of a given product. A good example will be, if you price a product £50 whilst the customer would have been happy to pay a price of £75, you have left £25 worth of value on the table. On the other hand a product may just be priced far above that what the market is willing to pay for it and thus as a result sales suffer. Faced with declining sales, most entrepreneurs will resort to increasing prices in order to meet their fixed costs thus the company enters into what is known as a death spiral. It is important that you get help in order to correctly calculate the costs of producing your products and applying an appropriate pricing policy.
Other pricing strategies to consider are competitor based pricing or perceived-value based pricing techniques. With competitor based pricing, you do a survey of how much your competitors are charging for a similar good and then you can opt to price above, below or in line with competition. On the other hand with perceived-value pricing technique, you try to find out how much a customer is willing to pay for your product. This can be done through a number of ways, from focus groups, to questionnaires etc. Information gathered from this exercise is used to then set the price of the product.