Starting a New Business

Starting a new business? Here are some good questions to ask beforehand… The article is with reference to a query on business in NY but it is worth reading…

• What type of business entity will you choose to establish for your business?
• How will you be funded?
• What will it cost you to operate the company?
• How will you set your prices and what kind of profit margin can you expect?
• How much capital will you need to operate the company until it begins to show a profit, and how long do you expect that will take?
• Who are your potential customers, and how will you reach them to let them know about your products and services?
• Who are your competitors, and how can you differentiate your company from theirs?
• How can you best design, operate, and promote your Web site?
• Who will make your deliveries, and what kind of insurance will you need to cover their presence in your customers’ homes?
• How will they make deliveries to clients living in New York’s secure high-rise apartment buildings and condos?
• What will be your long-term strategy for growing the company?

Here is some more advice on where to get the various resources:

First, check out some of those entrepreneurial advice books. Browse any general-interest bookstore, and pick out several business startup guides that appeal to you. If you don’t want to purchase them all, check them out of the library, one or two at a time. You can also find information online, from the Small Business Administration and from private organizations that assist entrepreneurs, such as SCORE and MyOwnBusiness.

PLENTY OF FREE HELP. Next, seek out advice from business consultants, professionals, and advisers. This doesn’t have to cost a fortune. Score, a nonprofit business mentoring organization, has a New York office where you can get free advice. The SBA operates Small Business Development Centers around the country that offer free and low-cost workshops, counseling, and seminars.

Robert M. Donnelly, a planning adviser at New York University’s Stern Center for Entrepreneurial Studies, recommends that you take the time to write up a simple business plan — a document that defines your business, identifies your target customers, and includes financial projections and cash-flow schedules. You can purchase business-planning software online, find templates in a startup guidebook, or follow the guidelines provided by the SBA.

"Most entrepreneurs are long on ideas but short on cash," Donnelly says. "That’s why it’s so important for them to be aware of the financial aspects of their business." He also advises that you draw up a detailed marketing plan that gives you a blueprint for how you will spend your precious advertising and marketing dollars to best effect. "Entrepreneurs are great salesmen but not necessarily good marketers," he adds. "Success in business is about marketing."

GET INSURANCE. Gene Fairbrother, a longtime entrepreneurial consultant based in Texas, suggests establishing your business as a corporation or a limited-liability company, rather than as a sole proprietorship, to shield yourself personally from legal liability. "You’re distributing products, and let’s say one of your customers gets a product and their puppy dies or has a bad reaction to it," he says. "If you’re a sole proprietor, you’ll get sued, and you’ll be personally liable."

You’ll need expert advice on which business structure is best suited to you, depending on several factors, according to Fairbrother. Assuming that your delivery staff will be entering private residences to bring customers your products, you’ll need general liability insurance, he adds.

Making your Web site user-friendly and promoting it online are additional considerations. Martin Lehman, a counselor at the New York SCORE office, suggests that you choose a domain name that tells the story of your business, and that you make payment as easy as possible for customers. "Since 95% of online purchases are made via credit card, you’ll need to establish a merchant account," Lehman says. "Check them out, as the charges vary."

KEEP YOUR PROMISES. Other priorities include making sure your site turns up high on search engines and finding ways to drive traffic to your site, establishing a shopping-cart program, refining your product list so you get the best prices from suppliers, and eliminating items that sell poorly. "Establish a good reputation for service, and have a dialogue with your customers," Lehman says, adding that a venue for customers to give feedback "is always a good idea."

Finally, Los Angeles business adviser Frank Stokes, of Stokes Pacifique Associates, recommends that you develop a "damaged goods and returns" policy that will satisfy your customers and confidence give them conidence in your company. "Just make sure you only make promises you can keep," he notes.

Stokes also suggests that you create letterhead and stationery that’s consistent with your Web site and that you use mailing labels for shipping that include your logo or letterhead, or both, to create product awareness and promote company image.

LEARN EVERY DAY. "Starting a business is a wonderful challenge, which may become very rewarding. But also beware of some of the pitfalls of entrepreneurship," he warns. "Failing to plan, taking too much personal income, lack of experience, lack of capital, unrealistic expectations, too much capital going into fixed assets, and not knowing when and where to seek help," are some of the things to watch out for.

Do your homework, seek expert help, and continue to learn about the pet-care industry every day. With a blueprint like that, there’s no way your business will wind up going to the dogs.

Tags: entrepreneur, business