5 Tips to Starting a New Business

I get asked by many entrepreneurs starting up a new business, what should I know on the start up phase.

Here are 5 essentials that you should know:

1. Make sure you have some alte
ative cash flow or built up funds. In the beginning, most start ups will not be making a substantial amount of money for their owners. They can be successful if handled properly and given enough time to grow, but they tend to take money in the beginning, not make money. Having funds built up to compensate for this unprofitable phase can make things much easier to bear. Having an alte
ative stream of income to offset the unprofitable business in the beginning is also a wise decision. Starting up a business with the idea that it will pay all of the bills in the beginning is not realistic and should be avoided at all costs.

2. Have a good business plan. With a vast majority of start-ups failing before they can really get off the ground, it's important to minimize this risk. The business is going to be the product of your time, effort and starting capital; it's worth it to at least have a good solid plan to boost the chances of survival. Not having one won't guarantee that the company will fail, but it will definitely lower the already low chances of success. A good plan that lays out goals and sub goals and the paths to reach them is critical.

3. Delegate Authority when needed. As the old saying goes, "Rome wasn't built in a day". Another truth is that it wasn't built by just one person either. A business owner really needs to treat the company like a well trained sports team. For example a football team has a variety of players for different situations and jobs. A defensive lineman will need to be very big and strong, while a receiver needs to be very fast and have great reflexes. No one person could fill all of these positions perfectly. In a company, there will be many jobs too. It's important to match up each individual with the job they are best at. All too many business owners want to make it a one man or one woman show. This is a big mistake. It's important to save money in the beginning, but this is an area that shouldn't be neglected. If there is at least some alte
ative income coming in, hiring someone as a contractor to help with areas that you are not an expert in is a wise move.

4. Make use of low cost or free advertising. Many people in this day and age still seem to think that advertising is all about radio ads and T.V. commercials. While this can be a great way to give your company more exposure, not all of us can afford such expenses in the beginning. Websites, blogs and social media marketing are all free or very low cost. Without them, a company will be very disadvantaged. If a website seems either too costly or too technical consider this; a hosted web site will usually run about $10 to $20 a month. Running a company in today's world without a website is unthinkable. A blog is free to have and post too. A blog is basically a mini web site that you can post articles about what your business does or about similar industry related subjects. The idea here is to get people to go to your website, so having links to your website on your blog can really boost traffic. Social networking sites can let you connect with many potential customers or clients. Linking up with people and talking about what you do can be a great way to gain more exposure.

5. Get in contact with everyone you know and tell them about your business. Old friends from high school, your next door neighbor, family and acquaintances; all of these people should be contacted and be made aware of you company. Don't try to hard sell them or anything, that's really annoying and counter-productive. Tell them about your new company subtly and don't try to sell your services or products to them right there. They will probably tell their friends "Hey I ran into Jason the other day; guess what he's doing?" If properly done this can spread word of your company like wildfire. You also never know what person either in your past or present might want your company's help.