4 questions to ask yourself before starting a business

So you’ve already got the idea, the passion and the commitment to start your own business. But with 90% of start-ups failing, the odds aren’t in your favour.  Chief executive of Advantage Business Partnership and co-author of ‘Creating Business Advantage: Setting Up and Running a Successful Business’ Daryl Woodhouse, has some advice for every start-up.

Answer these four questions with a yes and you might join the band of start-ups that flourish…

1. Do you have the knowledge and experience to get the product/ service to market?

Consider what experience or professional training you have had which is relevant for starting, running, growing and profitably exiting a business. Be honest in identifying your skills and knowledge gaps and then figure out how you can fill them before starting up.

2. Have you done your research?

Research extensively into the market. Is there demand for this product or service? Is it already out there? Who would be interested in buying it?

3. Have you received professional advice?

Get advice on the areas you know little about from people who do know.   Don’t rely too heavily on what you ‘think’ you should know and do. 

Even if your business idea is going to see you working from your kitchen table as a sole trader, still go and get some advice from at least a successful business coach, a knowledgeable accountant and a trustworthy lawyer as well.

4. Do you know what the best set up is?

At the simplest level a sole trader status can be set up quickly and without too much formality. But do you understand the implications? Maybe the correct legal entity for you is a limited liability partnership, a limited company, a charity, or a social enterprise. You need to get advice.

All these steps are crucial as the decisions you make at this stage are the foundations for what you build going forward.

Of course you then need to focus on the operational aspects of getting a business started: the funding, the website, advertising, your networking, your business plan, and all the myriad activities that will become your daily focus of attention in the time ahead.  But the importance of these pre-startup considerations cannot be over-emphasised.