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Small Business Start-Up Guide
by Robert Sullivan
. . brought to you by The Small Business Advisor
and starting a business is a little like climbing a mountain. It is
a perilous journey, fraught with unknown dangers and influences outside
your control. But if you keep your goal in sight and plan very, very
carefully, getting to the top can be a most rewarding experience. We'll
revisit this metaphor later.
concerning survival rates of new businesses vary considerably depending
on who's doing the reporting. For instance, the reported failure rate
during the first three years ranges from 10% to 85%. The real figure
is no doubt somewhere in between these limits. The point, however, is
that considering there are nearly a million new business start-ups each
year; many of them will fail. We're going to profit from these failures
by learning the basis for the failures, adding this information to data
we've gleaned from the successes, to give you a clear advantage. This
guide contains a wealth of information that is based on many actual,
hard-learned, and expensive lessons.
reasons for a business failure are too numerous to list, but they can
be categorized into these major areas:
In the following
chapters, we will discuss in some detail these areas and a number of others
that relate closely to them. Sources of additional reference material
are included at the end of each chapter.
of Entrepreneurial Qualities
2 includes information that will allow you to assess your own entrepreneurial
qualities. A checklist is included for you to test yourself.
3 covers choosing your business and selecting its legal structure. The
choice may seem obvious to you but you might be overlooking some obvious
pitfalls. The "right" business can turn out to be a disaster if the
choice is made for the wrong reasons. This chapter also discusses the
numerous legal requirements of which you need to be aware.
4 provides guidance on obtaining outside financing to start or expand
5 discusses partnerships and includes a checklist for choosing a partner
who will be an asset to your business. An effective partnership can
be a powerful combination for success, but the wrong partner is like
stepping into the batter's box with two strikes against you.
6 discusses planning. The lack of proper planning is the major reason
for business failure. This chapter gives practical advice on the planning
process, why it's important, and how to plan effectively for success.
This chapter also covers planning for failure. Huh? Well, the facts
are the facts ... Business is tough and failure is possible. If you
plan ahead for the possibility of failure, you will be ready to deal
7 provides advice for working with accountants, attorneys, and insurance
agents, all of whom you will be working with on a regular basis. Checklists
are included for selecting and dealing with these professionals.
8 covers the importance of a banking relationship, how to choose and
deal with your bank. A listing of banking services is also included.
9 discusses the significance of separation of home and business. It
is no secret that many couples split up because of the pressures of
one or the other going into business. Suggestions are listed that can
prevent this tragedy.
10 discusses marketing. This chapter is by no means comprehensive since
marketing is a very complex arena, but what is offered are simple suggestions
relative to basic marketing principles that can be critical to the long
term health of your business. The appendix to this chapter contains
listings for seeking out further information about marketing activities.
11. Protection! Don't skim over this chapter! This very important area
includes personal guarantee warnings, partnership agreements, and insurance.
12 provides some ideas on hiring employees and suggests hiring may not
be the best approach for you.
13 discusses technology and its relation to your business. Computers
and the Internet are discussed in some detail including selection of
hardware and software; maintenance; security; and more. You will probably
find early on that a computer is a necessary tool for your business.
14 discusses the importance of the Internet. Information is included
to show you how to "get connected" and how to use the Internet as a
valuable business tool. The Internet is just as important - maybe more
so - than the telephone is to your business success.
15 is about communications, writing and speaking. Included is a checklist
for effective writ-ten and spoken communications.
16 includes a listing of suggestions for day-to-day business operations,
including important areas such as saving money and using the telephone
to best advantage.
17 provides a summary listing of the major items to be considered when
starting and running your business and a few final thoughts.
I is a listing of reference material.
II is an index of the various checklists included throughout the text.
III contains information specific to home-based businesses.
IV is a listing of some useful Internet sites and reference material.
V provides information on obtaining a business merchant account so that
your customers may pay for services and products with credit cards.
VI is a small business glossary.
VII is state specific small business contact information.
VIII provides information on how your small business can sell products
or services to the Federal Government.
IX is a listing of important Internet milestones.
X is a compilation of useful small business tips taken from the Small
Business Advisor website.
chapter of this guidebook contains useful information for both the first
time businessperson and the more experienced entrepreneur. However,
each chapter stands alone, and if you are looking for information on
a specific topic, refer to the brief chapter descriptions above to determine
what portion of the guidebook will be most useful for your specific