Starting a business isn’t easy. If it were easy, everyone would be doing it.
Based on our experience supporting small business in Richland County, we identified the four most important resources that new entrepreneurs need to guarantee success, avoid lawsuits, and keep their business affairs in order. Let us know if you agree or disagree with them, or think we missed something. We’ll start with the most important one.
A product or service that people actually want/need.
This sounds like a no-brainer, but you would be surprised by how blind some entrepreneurs are to the needs and wants of their customers. They’re so obsessed with the “coolness” of their idea that they completely neglect to ask their customers what their needs are and how these can be solved.
Our guiding principle has always been that every business is simply a solution to a (customer’s) problem, meaning that if nobody is buying your product or service, you’re simply not solving any real problems for your customers (or maybe not in a way that’s affordable for them).
While a lack of money is a very legitimate reason that new businesses don’t survive, there’s no question that the biggest cause of business failure is that they make something that nobody wants or needs.
Another highly effective way to have your business fail is to get sued. When you’re starting out, you want to make sure that you’re in compliance with all the local, state, and federal regulations for your industry.
While they certainly aren’t cheap (often in the range of $150-$250 per hour), you absolutely need an attorney to help you not only get all the relevant licenses and permits, but also give you legal advice about which entity you want your business to be (sole proprietorship, partnership, limited liability company, corporation etc.).
An equally important member of your team is your accountant. The recent rounds of PPP funding showed us that many businesses have been operating without having their books in order – not filing taxes on time (or at all), not having profit and loss statements, etc. – which tragically made them ineligible for these funds because they couldn’t give banks the necessary (and routine) paperwork during the application.
Having an accountant on your team will ensure that you always have your taxes filed on time, payroll in order, receipts and paperwork stored, and financial statements ready to go in case you need to apply for a grant or loan. If you don’t have this paperwork, you will never be eligible for funding from neither the banks nor the government. No exceptions.
An insurance agent
While your attorney will tell you which regulations you need to be aware of for your industry, an insurance agent will make sure your business is covered in terms of liability. He or she will probably also be able to help you with things like workman’s compensation.
BUT WAIT...There's a bonus resource! Click here to read more