Are you starting a new business but are confused or unsure if you are on the right track? This article will help you and guide you to some basic guidelines you should remember.
In this article, I am going to write about some basic guidelines and processes one should remember and perform before launching their business.
If you want to start a business or you already own a business but are looking for tips to upscale your business then you are at the perfect place. I highly recommend you to read this article.
Below is the list principles you should follow before you launch your amazing business venture:
1. Research
What is Research and Why is it important to conduct research?
Research is “creative and systematic work undertaken to increase the stock of knowledge”. Research helps in increasing your knowledge. It helps in finding new opportunities, understanding market segments, and getting a competitive edge.
So why is it important to conduct research before launching your business? The answer to this is very simple, research will help you understand the probable demand of your product/service, how people react to your product/service, is it helping them solve a problem which they are facing, prospective target customer, age bracket which should be targeted. Thorough research will also help you in understanding the geographical location which should be targeted first.
What research should be done to get good results?
So we will take an example to understand this. Let’s assume you are planning to launch a healthy snack in the market. This is a baked snack and uses the most healthy ingredients so that the customers eat it guilt-free and also remain healthy at the same time.
Following research should be conducted for your above product:
- What problem does your product target to solve?
In our case, the product is a healthy snack. So, we target to solve the issue of replacing unhealthy snacks like fried chips with our healthy snacks. With this people will be able to have more quantity without worrying about increasing weight and at the same time they will get healthy nutrients in their body. - What will be our target market?
To determine our target market first we must conduct a market survey. On the basis of response to our survey, we will be able to determine our target audience. In our case, the target audience for our product will be health-conscious people, overweight people, people planning to change their diet (i.e. going from eating unhealthy to healthy food). - Who are your Competitors?
It is one of the most important parts of the research. Make a list of all the competitors. It helps us to understand how we should place our product in the market and whom are we up against. Make a complete list of competitors manufacturing healthy snacks, as a matter of fact, I suggest we should purchase their products to taste, check packing, quality, the shelf life of the product. The main target of this exercise is to know what competitive edge does your product has over other competitors.
You should try and understand how your product is superior to your competitor in terms of
– Price
-Quality
-Quantity in each snack packet
-Addressing Customer Grievance - Market demand for your product?
Conduct research about the current demand of your product segment. What does the research say about the future prospects of your product and what is the ratio or percent increase in the same? In our example, our healthy snack industry is expected to grow at USD 33.3 billion of a growth rate of 5.50% in the forecast period 2020 to 2027. So the market scenario and prospect are positive.
2. Mission, Vision and Company Values
Why should you create a mission and vision statement?
They are very important to lay a strong foundation base to your company. Without a Mission and Vision your company will be directionless and it will be difficult to achieve your goal smoothly. Some advantages of defining your Mission and Vision:
– It encourages to define and align common goals
– Helps in streamlining decision making in your company
– Strengthen your brand
Mission
•A mission statement supports the vision and serves to communicate purpose and direction to employees, customers, vendors, and other stakeholders.
Your mission statement should define your goals and targets. It should define the Purpose i.e. “WHY” of your business. Your mission statement should form a base for making decisions in your company.
•Very few people or companies can clearly articulate ‘WHY’ they do ‘WHAT’ they do. By WHY I mean your purpose, cause, or belief. People don’t buy WHAT you do, they buy WHY you do it.
Vision:
•The vision statement aims to clarify your ideal future state for the business. Think of your vision statement as an opportunity to harness inspiration, passion, and aspirations for the long-term business.
•A vision statement provides the direction and describes what the founder wants the organization to achieve in the future; it’s more about the “what” of a business. It is different from a mission statement, which describes the purpose of an organization and more about the “how” of a business.
Values
A strong value system helps in ensuring ethical behavioral traits. It also helps an employee understand the company’s expectation toward their behavior toward its Customers, Vendors, Colleagues, or any other person who is directly or indirectly related to the organization. Hence a value system is very important in an organization.
3. Planning for efficient use of Financial Capital available
It is very important that you have a very good strategy in place for the efficient use of finance that is being introduced in your company.
Normally the money introduced comes from several sources such as Personal Capital, Loans from Family and Friends, Bank loans, Investments done by investors.
So how do you plan to utilize the money that is bought in the company?
- Estimate the initial amount that is required to start your business. It is very important that you make realistic estimates and make a note of all the expenses that are required.
- Make a well-defined and a written plan of how to utilize the money available.
- Always prepare a cash flow statement and maintain it on regular basis. This helps in having the exact money available and how is the money being spent.
- Divide the fund available on the basis of money required by each department in your company. This may change from time to time.
In the initial stages, the majority of the money will be utilized in Product Development, Research, Purchase of Assets like Machinery, Laptops, Software, Office Furniture, etc. - Keep a tab on what was the estimated requirement at the start and how much was actually utilized. If there is a wide gap between both then assess the reason for the same.
- It is very important to have a reserve/contingency fund. This fund is to be used only in case of any emergency or crisis.
4. Departments/Areas in your Company
It is important to have different departments in your company. When there are different departments, each department has its own purpose.
It becomes easy for the smooth functioning of the business. Since each department is having its own purpose the work, responsibilities, skills required for each department is defined separately which does not lead to any confusion.
Below is the list of a few departments:
- Human Resources: Hiring employees is an art. It is very important that you ensure that you hire the right person having the required skills for a particular job.
- Purchase: Ensure you have more than one supplier for your raw material, finished goods, or any other purchases. Prepare a stock register that has to be updated on a real-time basis showing Opening Stock, Purchases, Consumption, and Closing Stock.
- Marketing and Sales: Have a very skillful and smart sales and marketing team. It is very important that the team understand the market requirement and market the product on the basis of strong research. The increase in sales is ensured by this department.
- Research and Development: Remember one thing that the world is constantly changing and it’s important for you to innovate and continuously upgrade. Have a good research and development team in place. This will help you keep yourself ahead of your competitors and achieve your targets.
- Finance and Accounts: Hire a well-qualified accountant which will help the business with finance and accounts. Ensure all your statutory requirements are complied with and they are no delays in filing required returns.
The above are some of the mandatory departments that each company should have. In case you are planning a business on a large scale then the departments such as Production (only in case of manufacturing companies), quality control, logistics, Information Technology, Public Relation and Customer Grievance and After Sales Service helps in conducting day to day business efficiently.
5. Hiring Right People
Hiring the right people is an integral part of any business. It is one of the most important factors to build a successful business.
Ensure a good interview process which should consist of several rounds such as Technical Test, Group Discussion, Personal Interview. It is not necessary for a person to be qualified or have a degree from only a reputed college or university. At the end of the day, the aim is to get the work done.
I believe hiring employees is an art as it requires understanding Job Requirements and finding a person with the required skills and talent to perform the job in an effective and efficient manner. If the hiring of employees is done right then conducting business on daily basis becomes easy if properly and timely managed.
Always ensure you give good training to your employees because they are the front fighters in your business. To remain in competition it is important that your employees are continuously upgrading their skills and applying the same. This helps not only them grow but the company also grows with them.
6. Strong Online Presence is important
The internet affords a level of relationship with consumers hitherto unfathomable.
— Lucas Donat
Why is it important to make a website?
The first most important thing to do is to make a brilliant website for your company. The website should contain all your products and services that you are offering.
Some of the most essential pages are:
-Home
-About the Company and its owners & management
– Products/Services Offered
-Contact and Join us form
-Customer Testimonials
-Privacy Policy
-Disclaimer
-Link to your blog.
Social Media Presence
Build your company’s pages on social media. You can build pages on various social media platforms such as Instagram, Linked In, Facebook, Twitter. Ensure your employee has liked or joined the particular page.
7. Marketing
It is important to note that market research forms an integral part of Marketing. The company should analyze its Market Research and form a strong marketing strategy.
Marketing includes both digital marketing and traditional marketing. You can refer to my below blog post for a detailed knowledge about
You can also use various digital marketing tools such as:
- SEO
- Google, LinkedIn, Facebook Ads,
- Content Marketing
- Affiliate Marketing
- Social Media Marketing
Selecting an appropriate marketing medium is very important to ensure successful sales of your product and services.
8. Have a Business Plan
Why is it important to make a plan before starting your business?
It is always important to have a well placed business plan. A business plan should helps in:
- Making conscious decisions about crucial business matters.
- Define definite goals and inform the same to employees.
- Having appropriate financial planning in place.
- Giving the right direction to where the business is headed.
- To keep innovating and developing high-quality products for customers.
- Increasing customer base and sales turnover of the company.
- Getting good Return on Investment for your investors.
- Earning good profits and reinvesting the same to continue innovation.
- Making a well know brand having a strong market hold.
- Helps in facing competition from competitors and enjoy a large market share.
9. Applicable Laws, Regulations and Taxes
Before starting your business make a checklist of all Rules, Laws, Regulations, Taxes that will be applicable to you.
Keep the checklist hand and always fill it on monthly basis. This will help you avoid any lapses and will make your company compliant on all legal front.
In case you are not aware of the rules and regulations that are applicable to your company then hire a professional who will help you understand the same make your company law compliant.
Make a list of taxes applicable to your company. Apply for all licenses to avoid any penalty or cases against the company. Ensure your taxes, returns are filed as per due dates applicable. This will help avoid interest on tax and unnecessary notices which could be avoided.
Mindmap Link
https://mm.tt/1905914805?t=YD0TJKHGch
Hope this blog helped you in understanding the things you should keep in mind before launching your business.