Starting a small business is a challenging undertaking that requires courage, determination, inventiveness and motivation. Many young people have great ideas and motivation, but they just don't know where to start. The following steps offer a basic guide for those teens interested in starting a small business business.
Steps
Step 1. Earn a fair amount of money to start with
Get a job and put the money aside in an account. This will not only help you save money, but you will learn what it means to work hard, and you will know what it means to work for someone. If you are given money, use it for your project.
Step 2. Determine what product or service you will offer
Choose something that interests you, that can arouse your enthusiasm. If you show enthusiasm, customers will end up getting involved too. Find a niche in the market - an unexplored aspect of your chosen market sector. Try somehow to steal your products from the competition by offering something that rival firms don't have. A good example could be the "goblin" - a patent protected cleaning system that, after 20 or 30 years, is still the market leader; many customers are happy to spend more to get the performance it guarantees.
Step 3. Determine who your target will be
Observe your competitors and examine their target market. Choose a part of the market and try to make it yours. Investigate and ask people what they think about your business project. Don't be afraid that your project may evolve; changes could make your idea better and more profitable.
Step 4. Write a business plan in black and white
Ask an acquaintance of yours to help you; a teacher or your parents will be happy to do this. Also, for inspiration, visit businesses in your area that offer similar products and services to yours, and ask to speak to the owner. Ask him what inspired him in starting his business, and what gratifies him most in what he does. It could serve as an inspiration for your Company Mission.
Step 5. Get the tools and supplies you need to start your business
With your own equity and possibly loans from other sources (again, parents are the right people to ask for a loan. Make sure you draft a formal proposal to show them you mean it). With the money you have, you can purchase the supplies you need to kickstart the business.
Step 6. Run the business plan
Ask your friends if they are willing to help you, or if they would like to work for you. Build your business from scratch, and never be afraid to ask for help.
Advice
- Don't hesitate to tell everyone about your new business; it could help you, in relations with other entrepreneurs, to be recognized as the owner of an independent business. Make your business as professional and formal as possible (try using a design package for your website, it could help you to be taken seriously by competing customers and businesses). You can use your site as a source of funding by hosting advertising banners from other companies; this is a great way to raise more capital.
- Always think about making a profit, but first make sure that customer service and product quality are your top priorities.
- Always make sure you are not spending more than you can earn from the business. If making a lemonade costs five euros and selling it will make you € 4.50, you are just losing your money! You may want to consider a higher price, or use cheaper ingredients for your lemonade.
- Make sure your business has something that sets it apart from other similar businesses.
- Don't hire employees until your business is already stable.
- Don't refrain from asking for help before you get started and in the start-up phase, even if it means sharing your earnings with the friend who helps you.
- Here's a good idea: Buy cheap chewing gum from a local store, then resell it for a slightly higher price to friends from school. You could easily buy a package for one euro, to resell it for around two euro, which would guarantee you a good profit. You can do the same thing with soft drinks. A pack of 12 cans will cost you between three and five euros; you could try to resell them for € 0.50 or € 0.75 a can. (Warning! When doing this, make sure it is not illegal to do this business without a license. The fine could be steep.)
Warnings
- It is possible that you will lose everything you have invested in the business down to the last penny, so make sure you start small, and don't use up all your savings.
- Make sure there is no competing company in your area; if there is, try to change your business proposal slightly, add items, change them, sell at a better price or improve quality, but by doing so make sure you still make a certain profit.
