Young entrepreneurs never had it so good. There is software and hardware, proven technologies and a host of infrastructural help to take you along. When a germ of an idea is born, it is not the time to go overboard about it and rush into things. Remember it is still a business idea subject to testing and a lot of market research about its acceptability.
What then are some of the aspects of business that young entrepreneurs ought to know before they rush headlong into the venture –
- Scale of business – Do not try to start big even if you have the required finances and man power and even though it might be a tried and tested business. For example, consider a cleaning business. To go off the blocks you will need trained cleaners, tools and equipment, adequate finance and an office. Now even if you have all of them but no references or clients, the project will fall flat on its face. Instead, shun the frills and let it be known through friends and relatives that you are in business. Be a one man army and do the job yourself. Build on it and when you find that you are unable to cope, hire people to meet additional demand. Expand slowly and steadily. This will be an opportunity to learn the operational facets of the business too.
- Piling up of inventories – If you are into trading, do not pile up stocks as these mean blocked capital. For high priced products it is always advisable to initially buy against orders received. Consider the case of IPL laser machines for sale. These are quite expensive and if you are the supplier, it is not good business sense to buy them against expected future orders. Have one machine as demo and keep buying one after selling it only. Even if you have a credit line with the manufacturer the same holds true. The interest component will weigh you down.
- Financing the business – This is where you have to be careful even if you are starting off with your savings. The longer you can make your pile work for you, the more will you be able to defer taking loans from financial institutions and having to pay interest and installments. This will mean more net capital buildup from profits of your business and accrued internal savings. This can be used for future business expansion and investment on infrastructure development.
- Marketing – Though this has been placed way down the list, it is to ensure that its importance is imprinted in your mind and doesn’t get lost between points. You need not have a large budget for marketing. The trick is to create a large base of potential customers in the minimum of costs. Go online with your business details. Have an online digital marketing campaign conducted by a reputed agency. Optimising your business site with local SEO techniques will bring in traffic, queries and business and will not be an expensive proposition. Most people today search online for products and services so your site should definitely have a very strong and visible online presence and high rankings on results pages of major search engines.
These are just guidelines for young entrepreneurs to follow. The rest will be hands-on learning as and when business picks up.