WELLINGTON COUNTY – Taking the plunge into starting your own business can be a rewarding adventure.
However, diving in headfirst without a proper plan or the proper research can put your new business at risk.
Kristel Manes, executive director of the Business Centre Guelph-Wellington, outlined the crucial first steps and common mistakes when starting a business.
Founded in 1999, the Business Centre Guelph-Wellington is a not-for-profit organization designed to support entrepreneurship in Guelph and Wellington County.
It offers business development programs and virtual seminars with business professionals, as well as hands-on workshops.
Homework
“We meet lots of great entrepreneurs, or people who would like to be entrepreneurs, and they have an idea of something they want to do, but it requires a lot of research and time and energy,” Manes told the Advertiser.
“You have to do your homework.”
Manes says before starting a business you need to look into any necessary business permits, licences and certifications, as well as location and financing.
In Wellington County, businesses must submit an application for a sign permit with their municipal office, including a description and the dimensions of the proposed sign.
For businesses dealing with food and alcohol, a food handling certificate, liquor licence, and Smart Serve certificate must also be obtained.
When choosing a location for a business, it is important to determine whether you will be renting or buying a space. Either way, this can become one of the biggest expenses for a business, so it’s important to research what municipal, provincial and federal business grants and loans are available to new businesses.
“Research is so important because it’s just not simple like, ‘Hey I’m registered now, I’m in business’,” said Manes.
“You’d be surprised how many people actually think that way and, while I love their passion, the reality usually hits when they realize they didn’t have permits or they didn’t have proper channels or they’re paying too much money for their goods.”
Make a business plan
According to Manes, the next step is formulating a business plan.
A business plan is a physical document that outlines a business’s goals, strategies, time frame, and other details. Entrepreneurs use a business plan like a road map, helping them navigate their new business step by step.
“Building a business plan actually helps you build a model or case for your business that you can show people how your business is going to work and that you’ve taken the time to figure out all the necessary details to make your business work,” said Manes.
Business plans can also serve as an asset when applying for funding for a new business.
“If you are planning to go to any type of bank or investor, they are going to want to see a plan,” Manes said.
“They’re going to want to see how they are going to get a return on their investment.”
Key elements to include in your business plan are:
- an executive summary or an overview of your entire plan;
- a company description;
- market analysis (research your industry, target market and competitors);
- a description of your products and services;
- marketing and sales plan;
- an overview of how your business will run on a day-to-day basis and manage resources; and
- a complete look at projected income, expenses and funding.
Common mistakes
“Seventy per cent of new businesses will fail in their first three years,” Manes told the Advertiser.
“Because they didn’t do the proper planning, they didn’t put aside proper amounts of working capital, they didn’t plan for the expenses and how they were going to generate sales.”
To avoid this, Manes encourages new entrepreneurs to reach out to local business leaders and professionals or organizations such as the Business Centre Guelph-Wellington for additional support and mentorship.
“Google is great; there’s lots of things online, but sometimes it’s better to be able to be in a classroom or watch a video or participate in a workshop that you can actually ask intelligent questions and get the answers,” said Manes.
