One of the primary worries of small business owners around the globe is how to make sure their enterprise makes money. You need your business to not only make money but you need it to make a profit after you have paid your overhead expenses.
Demand Makes Money for Your Business
Far too many times people sink their time and money into small
businesses that are losers. Why do they do it? Because they wanted to do
a particular thing and forgot the basic law of business profitably;
there has to be market demand. It doesn't matter if you're a supremely talented butcher if you set up your meat shop in a strictly vegetarian town!
Do Market Research
The market comes first; your ideas and/or wishes have to come second (or
even third). You simply can't start a successful business if there are
not enough people willing and able to buy your products or services in
your service area.
Write a Business Plan
Market research, is, as you saw in the previous point, the core of a
business plan and a business plan is your best protection against
business heartbreak.
Of the many reasons to work through a business plan,
the main one is this; when you're done, you'll know whether or not your
proposed business idea can be turned into a profitable small business.
Franchise Opportunities
Profitable franchises are profitable because someone else has worked
through the plan, smoothed out all the kinks and come up with something
that makes money.
If you have the money to buy into a profitable
franchise and are the kind of person that would make a good franchisee,
this can be the ideal solution for you.
Funding New Businesses
Starting a small business isn't for everyone, but it can be a good
option in slow employment markets when you have been laid off. It may
also be the perfect thing to do if you are recently retired.
However, if you are expecting—or hoping—that your new small business will immediately replace your employment income, you may need to think again. With the possible exception of some profitable franchises, it normally takes anywhere from six months to several years for a new business to become profitable.
Have a Supportive Spouse
For many people starting a small business, this is the best solution. The working spouse can cover the living expenses and contribute to the cost of starting a new business while you focus your time on handling all of the new business activities.
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