Biz

10 Things You Should Consider Before Starting A Business

Over 50% business start-ups fails in their first 12 months and over 80% in the first three years. The primary reason being running out of money, but the real problems are created before the business is started.Β  There are many things to consider and a lot to research before you start business.

Portrait of businessman in office

Here are ten crucial things you should consider before starting a business

1.Sole Trader or Limited Company

How you choose to run your business will impact how much tax you pay and the amount of legal and financial responsibility on you. As a sole trader you’re responsible for all your financial dealings and full after tax profits and if you decide to go for a Limited Company everything is shared. First find out the pros and cons of both sides when starting a business in Zimbabwe.

2. Business Vision

Define your business vision, the business you are involved in, the product or service you are selling, how you plan to grow your business and the primary competitive advantages you have. Having a clear business vision will become the driving force for you moving forward.

3. Write down your goals

Have clearly defined goals written down and how you are going to act on them. As a start-up business, you should focus more on the short term goals but also keeping in mind the long term goals. As an owner you should know what you want to achieve and where you would want to see your business in the next five years.

4. Target audience

The truth is you are not going to meet the demands of everyone, no one can. Know who your target market is and find out what unmet needs and problems they might have, your product or service should solve their problems.

5. Your business name

Your business name will be stuck with you forever or at least in the running of your business, think hard about the name that will represent you. Consider what you want your name to say about you and your business to your customers.

6. Market viability

Consider the size of the market, the percentage of the target market that needs to be captured to achieve the expected turnover levels and how the target market will know about the product or services.

7. Financial viability

Consider the investment amount required, the cost of production and the expense structure. The profit that will be made and the expected loss after a certain period of time, take into consideration the levels at which the project will break even in terms of money and volume.

8. Legal viability

Consider the contracts and agreements such as leases, buying and selling agreements, franchise agreements, registration for VAT as an employer for income tax purposes.

9. Insurance

As an employer, you are required to have employer’s liability insurance, if you have any staff and public liability insurance if you expect to welcome customers or suppliers onto your premises. If you sell products consider product liability insurance as well as any vehicle you use.

10. Web presence

Most small businesses in Zimbabwe do not have websites; you don’t need any skill or lot of money to put together a website. Consider setting up a website that will showcase what you do and how people can contact your business or for bookings. Every business can benefit from having an online presence.

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