The world of entrepreneurship lures millions of people. A lot of them dream to implement their ideas in life, while others are looking for the freedom that they cannot enjoy being employed. Regardless of the reasons why you would like to start a business, there are typical mistakes that are made by the majority of beginners. That is why we have prepared the most essential seven recommendations that will help you overcome the challenges of entrepreneurship when you are beginning the venue.
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Tip #1 – Provide Yourself with a Rainy-day Fund
Whatever area you choose, your business is always a risky venue, so you need to be prepared for any turns, including financial challenges. Try to save enough money to support yourself and your business, at least for the initial period of your project development. Do not rely on banks, relatives, friends, and partners. Taking loans and debts is not the best idea to take the first step in business.
If you are not sure if you can handle saving money for rainy days, consider different sources that you can make use of without the need to spend too much time. This might be Forex trading, for example. The knowledge you can obtain will be useful for the financial activity of your company. Another option is to gamble. There are plenty of casino sites you can make use of to learn to play games and make a profit. Check out the best reviews of the Bitstarz casino to find out more about the reliability of this site for players.
Tip #2 – Evaluate Your Strengths
Do not immediately chase after large production, beautiful expensive offices in the centre of the city or town you live in, or luxury cars. All this is just an outer shell that will bring more expenses than real customers, for whom these attributes may be important. Start small, so try to minimize costs wherever possible.
For example, at the first stage, you might do the following:
- hire freelancers,
- use coworking spaces instead of renting an office,
- arrange meetings at the client’s office, if possible, schedule a meeting in a café, or rent a meeting room for critical meetings in a coworking space.
Making sure that your business ideas work and expand, increasing turnover is essential for any business. Even if you fail, the losses in such cases will be insignificant.
Tip #3 – Stick to a Business Plan
Surprisingly, so many people still start their own business without even trying to at least briefly sketch out a plan where you need to analyse at least possible profits, losses, risks, and expenses. The language of numbers, and even in writing, is sobering. With a plan, you will be able to plan your actions more clearly. Therefore, it is crucial to not only write it but also stick to it.
Tip #4 – Consult with Experts
This applies to the specifics of your business and legal issues:
- How will you register your company, which registration form will you choose?
- Which taxation system to choose?
- Does the business qualify for tax breaks?
- What contracts do you need?
- What taxes will you have to pay?
- What reporting to submit?
Use the services of professionals so that later you do not have to pay even more for your mistakes. Being able to delegate such matters will also free up your time so you can focus on the business. At the initial stage, the services of an outsourcing company will cost you much less than hiring an accountant, lawyer, and personnel officer. This approach has proven to be cost-effective for numerous companies.
Tip #5 – Protect Personal Assets
Keep in mind that by doing business as a sole proprietor, you are personally liable for all business obligations. There are situations when your house or car can be taken away from you for debts or loans. Weigh everything in advance, perhaps in your case, it would be better to register a limited liability company (LLC), not to be an individual entrepreneur. In this case, it is also better to consult with a professional who will recommend the best form of ownership to you.
Tip #6 – Get Everything in Writing
Try to fix any agreements in writing, even if it is not important according to the law. In that case, at least you will have proof. This might apply to your agreements with contractors, employees, tenants, etc. In the case of any disputes, you will have the confirmation of your initial intentions.
Tip #7 – Pay Your Bills and Taxes on Time
This is one of the indicators of how you can keep your word, whether you can be trusted, and whether others will work with you. Your reputation in the business community will be formed from such actions. In the case of the tax authorities, the level of responsibility should be even higher, because sanctions may be applied to you, for example, blocking your bank account. All this will further complicate your activity or stop it altogether. Currently, in case of non-payment of taxes and other bills, the tax authorities have the right to freeze the money in the company’s account for the amount of unpaid taxes, but for failure to submit reports, the account may be blocked completely.
Hopefully, you will avoid the most common mistakes and be able to overcome the most frequent challenges encountered by entrepreneurs.