So You Want to Start a Business? A Roadmap for Success

Lately, several people have contacted me for advice about the steps you should take early on when you're planning to start a business. I always think of starting a new business as a journey ... so here are six essential steps to help ensure you arrive at your intended destination, in one piece! (Oh, and by the way, this list is also great for existing businesses that are ready to "take it to the next level").

First, understand your goals as a business owner. Get really clear on why you want to start this business. Do you want to grow a large company and employ lots of people? Do you want to build a company that you can "cash out" in a few years? Do you simply want to replace a good income while working fewer or more flexible hours? Entrepreneurs can find themselves working harder than they want and feeling "trapped" because they've built a business that doesn't suit their needs. Understanding your personal goals in starting a business can help ensure you build it in a way that is consistent with your lifestyle dreams.

Next, create your vision. Besides creating income, what is the purpose of this business? Who does it serve? How does it serve them? What's unique about it -- that special something your customers can't get anywhere else? Don't be afraid to dream big here. Your vision should be something that gets you excited to start creating. Keeping a clear vision in your mind's eye will help keep you going during the harder times.

Then, do your homework. Before launching your business, you must take the time to do market research. This is an essential step to getting started correctly because it will help you avoid mistakes and thereby save you time and money. So, use publicly available information sources (census data, industry trade association research, etc.) and plan to ask questions of people in your target market, too, to really get smart. Key questions to ask: How big is your target market? (i.e. Are there enough potential customers to make your business viable?) What's the best way to reach them? What are their needs/wants/biggest headaches that you might be able to solve? How do they react to your ideas for your business -- including your pricing? Who are your competitors? What are their strengths (that you must meet) and weaknesses (that you can use to your advantage)? Depending on what you learn in your research, you must be willing to completely change your assumptions, your business model, or walk away from the idea altogether. The only thing worse than not doing research is doing it and then not heeding what it tells you.

Assuming your research gives you the green light, you then need to develop your plan. Set a few key goals for your first, second, and third year(s) of business. Make sure you include financial goals (I recommend profit goals over revenue goals). Other goals might include number of customers served, number and diversity of products/services sold, or number of employees/contractors working in the business. Once you have your goals, start building the plan that will get you there. What are all of the strategies you will employ to get there? Consider how you will market your business, how you will sell your products/services, who you will partner with to manufacture or distribute any products/services, what employees or roles you need to fill in the business, how you will manage day-to-day functions like customer service, bookkeeping, etc. Once you know all the steps, organize them around a calendar so you know all the big things you need to achieve each month to keep you moving toward your goal. And as you do this, keep in mind your business owner goals and your vision. In other words, if your goal is to replace your income while working fewer hours, do not build into your plan steps that look like "get out there and cold call 30 hours a week" or "buy a Blackberry for 24/7 accessibility." Be smart -- make your business work for YOU, not the other way around.

Get real about money. All of the steps you've outlined in your plan will require resources - either your time, your money, or both. So get real about how much you can afford to invest to make this business successful and then make sure you have ways to access those resources before you begin. Do you need to get a business loan, tap your savings, tap your personal credit? How will you keep the business running until it starts to see revenue? One of the most common reasons for small business failure is undercapitalization. You need to be honest about your "expected" and "worst case" financial scenarios. What if you're getting positive feedback but no revenue coming in yet? How long can you afford to hang in there and wait? How much money and time are you willing to invest? If you don't know the answers to these questions, ask other entrepreneurs with similar business models to share their experiences with you. If you know these things in advance, you can save yourself untold stress over money and the unknown. And please, if you have a spouse or a business partner, share all your expectations about money and time with them and make sure they are in agreement with your plan. If your spouse becomes fearful about the time/money investments you are making, it will undermine your confidence as a business owner as well as your relationship. Make sure your entire support team is behind you before you begin.

Finally, commit to a monthly review. Sometimes, we get so involved in the day-to-day that we forget about the bigger picture. Take time right now to block a half day in your calendar each month to step back and look at the business. During those meetings with yourself, you want to pull out your plan and budget, your vision, your lifestyle goals. Review it all .... are you being true to yourself? How are you progressing on your monthly goals? How do the finances look? What's working and not working and what should you change?

Starting a business is an exciting journey but the road is sometimes curvy or bumpy. By mapping your course, fueling your tank before you begin, and then being flexible enough to follow a detour when needed, the trip will be more enjoyable and more likely to result in your arriving at your intended destination.