30 Questions Every Entrepreneur Should be Asked Before Starting a Business (Part 1)
PART I
Over the years I have noted a series of issues that face the Business Start-up. Very simple but costly questions that I wish someone had asked me when I set up my first business 30 years ago.
COUNTDOWN
No.1 Have you looked at ways to improve your credit worthiness and reviewed your CREDIT SCORE? Have you looked at ways of improvement before requesting financial support for your Start-up? Review errors on your profile? Are you on the voters role? Do you have a good record for paying your bills on time? TIPS
No.2 If you are still in full-time employment and are the primary breadwinner with dependants- and have a mortgage have you had a conversation with your Financial Advisor? What advice have they given you? Do you understand the differences in applying for a mortgage when you are employed vs self employed?When does your mortgage rate change and renew? Before giving up your day job- review the rates and terms available to you employed vs self-employed?
PARTNERSHIPS
No.3 If you are setting up as a Partnership: Do both parties share the same vision, commitment and values to make the business a success? Do you have the same commitment in terms of time, labor and financial risk? Have you defined how this will be measured and managed fairly? Have you established clearly your individual & defined roles, functions and responsibilities and boundaries? Plus who has the ultimate final decision if a major challenge arises?
FINANCE
No.4 Have you enrolled in a basic book keeping course? Do you understand your financial’s; your operating costs, break even per month, bank balance, tax bill forecast, outstanding balances of debtors or creditors (if you don’t know what these are get learning quick).
No.5 Most importantly at the start-up stage -Have you developed some negotiation skills in BUYING as well as SELLING? At the crucial start-up stage where you are investing in large capital investment learn to negotiate & haggle. Ensure you shop around- always research at least three suppliers with competing offerings from warranty, service agreements, delivery and discount terms.
No.6 Have you exhausted all resources of business support from training, grants, financial support, expert and digital support. Have you contacted your local Business Gateway in Scotland and if you are between 18-30 years old have you reached out to The King’s Trust?
No.7 Have you taken the time to write a concise business plan, with your start-up costs, cash flow & profit & loss projections. Primarily for yourself to question the vision and viability of your business and secondary to assert your level of commitment to your bank manager or investors.
No.8 Do you always research your responsibilities and read the small print from; Terms & Conditions, Clauses, APR, Penalties, Time frames, Legal obligations. From Bank Loans, Lease Agreements, MTD (Make Tax Digital), I.P, HMRC to Companies House. Always read the small print, don’t be afraid to ask questions (even if it sounds stupid) and like any agreements only sign what you fully understand.
No.9 From the outset when seeking funding decide what is most important to you; The need & speed to start trading immediately by using your own funds? Or delay your initial start-up to secure private or public funding or grants? What is most important to you time or money?
No.10 In addition to your Business Bank Account have you set up a Tax Pot or Tax account. Ensure that from day one you set up a Tax account as a reminder when you go beyond that initial tax free earning threshold you start putting away a basic 20% reserve from your profits. And trust me you will sleep better at night. And as the business and profits grow increase accordingly.
No.11 To PATENT or NOT to PATENT -Innovative start-ups have to think long and hard. Some businesses may have a new piece of technology, concept or idea that is highly unique and innovative, particularly in todays age of A.I. There can be counter arguments for I.P. some businesses may find that having a compelling brand and having the speed to be first to market and gaining the first adopters is their strategy. To others a priority to secure legal protections i.e Trademarks, Patents, Design rights etc will inhibit copycats and protect their brand and innovation in the longterm. Every business owner must weight up the pro’s and con’s!
BRANDING
No.12 Do you have the correct business name & logo- Do you understand the cost of not getting it right first time, secure; URL’s(domains), check conflicting trademarks & brands, registered company names. Check out our last post-Is your Brand a SUCCESS or FAILURE?
NETWORK
No.13 Who is your personal support network? Often in business we dismiss the greatest benefit of Entrepreneurship- the ability to design a business that can work around your personal lifestyle and priorities. Before firming up on your days and hours of work, assess your personal support network. Who will pick up the slack at home, help with the school run? Do you need additional child care or will your business model work around school times & vacations? This is the time to set the rules, routine and design your dream business!
No.14 How good is your B2B or B2C network? Are your clients, suppliers, potential consumers from your network- when did you last reconnect with old school colleagues, past business contacts, contractors- have you reconnected on Linkedin? Capitalise on past relationships and reconnect before you launch that new business!
No.15 Do you have a “Mentor” a veteran entrepreneur whom has built their business from scratch & operated it for over 15 years ( If inherited has ran it themselves for 15 yrs+). Research and reach out to specialists in your sector, old employers, business colleagues etc.
Follow our Business Design Mentor page to ensure you get the final but most important last 15 lessons, next week….
