Advice if you need to establish a business
For students this perhaps sounds especially familiar
, more if you are one who has just ended their studies and is now thinking about starting a new business. Although you have all the theory you won't have the experience and practical understanding of the market you are trying to enter.
So for recent graduates here are a few pointers and advice to help you prepare for your new business and even to help you decide whether your business idea is in fact worth investing in. This is obviously something you should know before starting your business.
Firstly, get some independent and impartial advice. Just because you like the business model doesn't make it a good idea. Don't rely on friends or parents; instead ask a business advisor, someone with experience in the field. These are the type of people to talk to and listen to as they can look at your business proposal and tell you whether you should move forward with it. Something else to consider is trying to get a loan from the manager of your local bank, if they give you one then their decision could indicate that your business has potential.
Then you should think about how many potential customers you are likely to have or how many products do you think you will sell. You really should have a good idea of how much money you will generate and even how busy and occupied your staff are going to be. By doing this you will then be able to...
...calculate exactly how much profit your business idea is likely to generate. Can you make a whopping $80,000 a year, or maybe closer to $15,000? Or if you're based in the UK then 9,500. You will then be able to work out with some accuracy when it is that you will recover your investment, break even and even how long until a profit is made. You don't want to rush ahead and spend money you haven't got but instead you need to have a clear idea of when to spend money and when it will benefit the company.
Next, what about your company overheads? If you will be taking a
Canary Wharf office then how much is the rent? And how much floor space is needed? As well, think about how many employees you will need in order for your business to function properly and how much the wages will be for the entire staff per year. You may also want to consider whether you will need reception staff and cleaners. These types of costs add up.
You should then go over other kinds of overheads, such as commercial building insurance, utilities, IT solutions and computer maintenance. And you also need to know that when you are creating a business projection you should be conservative with projections of incomes and over-estimate any outgoings, if you do this you should have an accurate idea of what you are likely to experience during your first year. And if you predict profits you can be assured that it is not because you have been too vague with your forecasts.
Only after following the advice given above should you get started with your new firm and take a tour of potential offices.
Advice if you need to establish a business
By: Isabell Isai
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