5 Essential Elements To Starting A New Business

Kelowna accountantKelowna accountant Ken Davidson provides his perspective on the 5 essential keys to starting a new business in this week’s blog.

I often get asked by my clients what are the things they need to think about most when started a new business. I’ve compiled a list of 5 keys that I always cover with them here.

1. Choose Something You’re Passionate About

Don’t start a business that you aren’t interested in. I think that a lot of people think that they can get involved in a new business and convince themselves that they will learn to love it.

This situation is similar to when a university or college student pursues a certain field of education just to “get a good job”.  Many entrepreneurs often get involved in a business because they believe it will make money.

When it comes to being a truly great entrepreneur, money is not a good enough reason on its own. You’ve got to have some passion, drive and love for what you’re about to jump into if you truly want to be successful.

To be successful, the first thing to do is fall in love with your work.
 ~Sister Mary Lauretta

2. Do Your Homework

Make sure you understand that there is in fact a business model that can be profitable. If there is not a profitable business model in your idea, you’re probably just doing it for a hobby. That’s much different than going into it for a business.

There is absolutely nothing wrong with doing something for a hobby but you must make the firm distinction if you do want to make it a business. Is it a hobby or is it a business? The way you operate is very different when it’s a hobby versus a business.

Related: How To Work Smarter, Not Harder

I recently saw a Kelowna business for sale that I genuinely thought would be a fun business to run. The problem was that I couldn’t really see how I would make any money from it. Therefore, would I want to spend my time there doing it for a hobby potentially losing money? The answer to that is definitely no!

Kelowna Accountant3. Start Building Your Own Plan

How do you see your business running? You might be thinking of running the exact same business as somebody down the street but the way you operate it and the way you want to run your business is totally different.

You need to personalize your business plan and fully realize the way that you want to operate. Once you’ve figured it out, you need to get some good advice.

4. Seek Out Advice

Now that you are at  that point where you understand the identity of your business and exactly how you want to run it, you need to get some external advice to remain objective and build momentum.

This is a tough obstacle for a lot of people especially because until you know what you want to do, you’re just going to be listening to your advisor’s advice and that’s not what you should be doing either.

Related: The Key To Choosing The Right Business Advisors

Ideally you want to take your general plan to a business advisor and ask them to critique it, you.

I tell my clients that my job is to take their rose-coloured glasses off, smash them on the floor, beat their business plan and really challenge them to take their business to the next level.  Then if they still think it is a good business idea, I support them 100%.  You don’t want to pay me to just tell you that you’re doing everything right…do you?

5. A Good Business Advisor Will Support You

A good business advisor will challenge you but a great one will also support you once you’ve made your decision. You should never let your business advisor make your decision for you.

Sometimes people get distressed when their advisor tries to challenge a certain idea and then turn around to support it once you’ve decided to go ahead with it. Some suggest this as “turncoat” behaviour but this is the role of a great advisor. They will accept your decision once you’ve made it and start trying to figure out how to assist you in your success.

“I can show you the door but only you can walk through it.”

~Morpheous from “The Matrix”

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