Published on : 03 June 20205 min reading time
To set up your business, you need to consider a number of points without which you may lose your initial investment. For it is not enough to have the entrepreneurial spirit to ensure that your business will prosper in the short and long term. So here are 5 elements to know before launching your company.
The viability of the company
The creation of a company starts with a simulation of its operation that you have to put on paper. This is the business plan that determines the elements necessary for the success of the project. Imagining how your company will operate in a summary way will not give you as accurate an idea as when you put your ideas down on paper. This business plan should list the various problems you are likely to face in order to gain some visibility for the future of your company before it is launched.
Among the points to raise when you draw up the business plan are the formalities for setting up the business and the legal status. For example, if you opt for a limited liability company or sas, you will have to spend between 2,000 and 3,000 euros on administrative formalities including accounting costs for the first year. You must then find a solution to make these expenses profitable. So many questions that you must answer before investing in a company that may not give you the expected results.
Then try to consider all the problems and possible expenses to find a way to compensate and remedy all the obstacles without losing money.
For more information, go to: www.statutentreprise.com
Understanding the market reality
Market research is an area that deserves a lot of interest from the future entrepreneur. In the beginning, when you think you have a sensational idea, you forget to check whether it meets real consumer needs. So, you have the choice between carrying out your survey yourself and entrusting this task to a research department if your budget allows you to do so. Put your ego aside and don’t do as the majority of new entrepreneurs who want to offer their services in a saturated market or to clients who don’t want them. For this reason, a market study must take into account the opinion of at least 200 prospects.
As the surveys progress, you will discover the true expectations of your target customers. You may not be led to leave your idea aside, but to modulate it in such a way as to find a compromise between your objectives and the customer’s needs: this is the winning equation. This is the winning equation. Many new entrepreneurs don’t fully appreciate the value of this crucial step. They can spend all their savings on a business that will not find takers in the economic sphere.
The reality of the market is a point that should be studied regularly, even after several years in business. Trends are changing and so is consumer behaviour. If your products and services don’t follow this evolution, you will be heading straight for failure.
Thinking about financing
A word of advice not to be overlooked: never launch your business if you haven’t put some money aside either to cover your personal expenses or to invest in your new business. Whether it is for administrative or other procedures, you must have enough money to get started. If you feel your savings are not enough, then ask your family or friends for help. However, if you plan to borrow money from your family and friends, you should decide from the outset on the terms of repayment and the possibility of selling them shares in your business.
Another avenue to explore is angel investors. These are people with large sums of money that they want to invest in start-ups or SMEs. This alternative, dreaded by young entrepreneurs who have just started up, is nevertheless a good solution. Not only will it allow you to raise funds for your business, but you can also benefit from the experience and network of these investors. Count between 25,000 and 100,000 dollars that can be granted to you for a business creation.
Find out about legal status
As mentioned above, you need to find the legal status that corresponds to your business activity. This depends on the number of partners. However, if you want to start up on your own, you can choose one of the following legal forms:
Single-person simplified joint-stock company
One-man business with limited liability
Sole proprietorship with limited liability
Once you have chosen the legal form of your company, contact the business formalities centre, which will simplify the formalities and enable you to obtain your status in the shortest possible time.
Distinguishing yourself from your competitors
Generally speaking, no matter what sector you are going to enter, there is likely to be competition. To do this, you must study your competitors’ products and services carefully to find your place in the market. Standing out from the crowd is both simple and complicated since an original idea can make or break your success. When looking for what will set you apart from the others, think about :
Evaluating prices to stay competitive
Determine specific customer needs
Propose a new marketing approach
Create a memorable and easy to identify brand image