S tarting and running a new business can be a baptism of fire for first-time en- trepreneurs. No one can know everything they need to know, but there is a fine line between learning from your mistakes and damaging your business. The aim of this ten-step plan is to help you build a simple strategy for success. Use these guidelines as a framework to help guide your business in the early days, and create a solid foundation for long-term growth. 1. Are you suited to business? Ask yourself if you are sui- ted to being in business for yourself. Although it might sound glamorous to be the boss, setting up in business (especially in the first few years) is hard work, requiring a lot of guts and often bor- rowed money. People get the entrepreneur- ial bug in lots of ways. But how- ever you catch it, you must be sure you are suited to self-em- ployment and the possibility of becoming an employer. Be clear about your goals. Write down the personal and busi- ness goals that, by going into business for yourself, you will be able to achieve. 2. Come up with an idea New businesses typically work in one of two ways. They either put an original idea into practice, or build on an existing idea. A large proportion of en- trepreneurs don’t come up with original ideas. Instead, they see an opportunity to alter, im- prove or expand on an existing idea. Business ideas can be found all around us ^ through travel, by watching trends or simply keeping your eyes and ears open to the problems people need solved. From a business point of view, many will be willing to shell out for a solu- tion that works. Just because you have an idea, however, does not necessarily mean you will have a successful business. So the next step is to research your idea. 3. Researching your idea You must be able to satisfy yourself (and also potential in- vestors) that a viable market ex- ists for your idea; that you know who your customers will be and you have an awareness of your competitors ^ who they are, what they do and how they do it. While researching your market, always remember that your product or service needs to fill a need and be different from, or better than, anything already out there. Being suc- cessful in business is not about jumping on the bandwagon. Invest time changing and amending your business idea so it becomes different, better or more desirable to your tar- get market ^ ideally, all three. Quality market research will help you to: & position your product or service effectively & determine where your business should be located & work out how you should market the venture & identify the staff or skills you will need to run your busi- ness. You can carry out a lot of useful market research online, using tools such as LinkedIn. Although it can be tempting to go for the cheapest research option ^ that is, using friends and family as guinea pigs ^ don’t do it.They will be biased in their responses and may not even fall into your target mar- ket. 4. Plan for success It is easy to start a business. It costs just e20 to register a business name electronically on www.cro.ie. The difficulty comes with making the busi- ness a success. Drawing up a good business plan will force you to consider all aspects of your idea ^ from your cashflow to your manage- ment team ^ especially the areas you’re not naturally in- terested in or good at. A business plan must be written down, forecasting where your business will be in the next three years and how it is going to get there. The plan will be crucial to supporting your business, par- ticularly when it comes to ac- cessing finance. Before you even get to that stage, however, read through your plan your- self. Doing so will help you to assess the viability of your busi- ness idea in reality. Be prepared to re-visit your plan regularly to compare the reality of how your business is developing with your original plan. Amend your plans as ne- cessary while your business gets off the ground. 5. Reaching customers The best product or service in the world is worthless with- out a market to sell it to.You need to know as much as possi- ble about your target market from the start. You must be able to tell your market about your product as often and as loudly as you can afford to. Remember, always market the benefits of a pro- duct or service, rather than the features. Rather than telling the customer what you can do, you should be answering the customer’s question, ‘‘What’s in it for me?’’ Here are some tips: & low-budget and imagina- tive marketing options such as competitions, gifts, and online sources are limitless & advertising pays, and smart advertising pays better than bad advertising & there is such a thing as bad publicity, so be careful with PR gimmicks. 6. Financing your venture You may never get abetter analysis of or feedback about your business and business plan than when you approach a bank, investor or government agency about finance. If you need money, you must con- vince the lender that you can pay it back. First, think about what the money will be used for: capital investment, working capital or operating costs. There are many financial products avail- able for each purpose including commercial mortgages, term loans, overdrafts and business credit cards. Aside from the traditional lending agencies and family- founder-friends, there are a number of other places to go for finance such as: & the Enterprise Boards (www.enterpriseboards.ie) support local businesses with less than ten employees. & Enterprise Ireland (www.enterpriseireland.ie) provides financial and non-fi- nancial supports to companies with the potential to reach ten or more employees in the near future. & First Step (www.first-ste- p.ie) provides loans to people who want to create their own enterprise and who cannot ac- cess funding, or sufficient funding, from other sources. 7. Get training Consider attending a Start Your Own Business Course. This will address all of the areas of setting up a new busi- ness, as well as give you the op- portunity to meet with other budding entrepreneurs to share ideas and contacts. These courses not only pro- vide you with all of the practi- cal information you need, but often challenge your ideas and force you to think about creat- ing the best business model that you can. Contact your lo- cal Enterprise Board for more information or email hello@- QEDtraining.ie and we will point you in the right direction. 8. Manage your cashflow ‘‘Cashflow is more impor- tant than your mother.’’ So goes the old business adage, and this is especially true for start-ups. Before you start, list all the costs involved and always allow a contingency for unforeseen costs. Small and growing busi- nesses eat money, so keeping a close eye on your expenses on an ongoing basis and ensuring that debtors pay you on time are vitally important. Monitor expenses regularly, looking at them as a percen- tage of your total sales, and compare this to what is in your business plan.This keeps your eye on the business’s financial health. Many people focus too much merely on the turnover figure and take their eyes off the ball when it comes to ex- penses and monitoring net profit. 9. Think big A common trap is a business model that creates either a hob- by business or just one job.Ty- pically, in the hobby business, the owner is working more hours for a lot less money than they would get on the open market. In the second instance, a job is created which simply pays the owner the same money that they would get on the open market, but which comes with added stress and risk and no real freedom. Businesses need money to survive and also to take advan- tage of new opportunities that present themselves. They also need money to buy you free time for work ‘on’ rather than ‘in’ your business ^ a key com- ponent of success. If you don’t plan for the busi- ness to make money, you’ll never be able to buy the re- sources that your business needs to grow and to buy your- self the room to make choices. 10. Exit strategy It might seem like an odd consideration in the initial stages, but you should think about the ‘end game’. Ask yourself the following: & do you want to build an asset that you can eventually sell off for a tidy sum? & do you want to start a business that increases in value and runs independently of you, or one that you can franchise in Ireland and abroad? & do you want to create a job for yourself that, after re- tirement, gives you a healthy pension to sustain the life you are used to? All of these issues are well worth thinking about to help ensure you make the right deci- sions, follow the correct path and lay the foundations for a achievable exit. Joanne Hession is mana- ging director of Quality Edu- cation Development (QED) Training, a provider of busi- ness training services to start- ups. For more information, see www.QEDtraining.ie Top ten tips to make your firm a success OUT ON YOUR OWN Before setting up your own enterprise, consider your aims carefully and create a solid plan, writes Joanne Hession Facebook is a social phenomenon without precedent. An incredible 750 million people around the world use the site regularly, creating a world of opportunities for small businesses to meet and engage with potential customers. To get your business started on Facebook, you need to set up a personal page and create a business page. It can be easy to confuse a personal page with a business page. To differentiate between the two, bear in mind that a personal page will have a ‘+1 Add Friend’ box at the top, while a business page will have a ‘Like’ box at the top. To create a page, log on to http:www.facebook. com/pages/create.php. You will automatically become the administrator of the page, but you will also have the option of making other users administrators once they have become fans of the page. When you, as the administrator, write on the wall of your page, your post will appear as though it is the business itself ‘speaking’. Comments from non- administrators will appear with their personal profiles. Branding Branding your business page is important and you should treat it as you would your official website. You can register your Facebook address to include your business name – for example www.facebook.com/ socialmedia.ie. This facility is available to all businesses once they register a vanity URL at www.facebook.com/ username. Choose a distinctive picture for your profile and upload further visuals into an album, featuring along the top of the page, to demonstrate and showcase your products and services. Newsfeed This is a personalised news stream featuring news from the Facebook friends, groups and businesses you have opted to ‘like’. Your aim, as the administrator of your business page, should be to feature as prominently as possible in the newsfeeds of your target audience. Find ways to actively engage your fans – be it by using special offers and discounts or entertaining them and making them laugh. Ideally, you want to ensure they share your content with their friends. Toolkit Facebook has an array of tools available to help businesses build their fanbase on the site. These include the following. 1. Ads: Facebook Ads allows you to use demographic information – such as age, region and personal interests – to target a specific audience. 2. Insights: these give business page administrators insights into the demographics of their fan base. Monitoring these insights can play a crucial part in helping to ensure you are talking to the right audience. 3. Places: the exponential growth of smartphone technology is driving demand for location based marketing strategies. Put simply, this means that customers arriving at your premises can ‘check-in’ online, letting their friends know exactly where they are. Using Facebook Places, you can register your business for the service and, every time a customer checks-in online, you get free and immediate exposure. 4. Apps: businesses can install Facebook Applications to improve the functionality of their Business Page. These apps can include anything from a welcome page to a Facebook store, embedded videos, blog and Twitter feeds, data capture services and promotional applications. Here are details on some useful apps for businesses. Pagemodo.com – allows you to redesign Facebook pages. It is free to create, but does have a Pagemodo footer on the page, which can be removed at a yearly cost of$20. Involver.com – offers a comprehensive range of free and professional tabs for Facebook business pages, including YouTube, Twitter and Flickr, plus ‘on page’ services, such as RSS feeds, sign-ups, coupons, gifts, promotion galleries and store locator. Northsocial.com offers a bundle of applications, such as competitions, sign-up, shop and many more. Constantcontact.com allows you to maintain regular contact with customers and clients using targeted email newsletters, invites to offline events and online surveys. Strategy We recommend integrating all of your digital media channels. You can use websites and blogs to drive traffic to a Facebook business page by installing a Facebook Connect ‘Like Box’. This will automatically update your Facebook profile and appear in friends’ newsfeeds. Conor Lynch is a social media strategist and founder of SocialMedia.ie, which advises businesses nationwide. See www.socialmedia.ie Social media for start-ups More than simply Facebook value In the first of a new ten-part special, social media expert Conor Lynch offers advice and insights into how online tools can help new companies establish their brand and win business. This week’s topic is getting started on Facebook CONOR LYNCH Joanne Hession, founder and managing director, and Siobha ´n Finn, director of enterprise learning and development, QED Training MAURA HICKEY Remember, always market the benefits of a product or service, rather than the features it has n26 THE SUNDAY BUSINESS POST SEPTEMBER 11 2011