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Idea Exchange: Advice For Young Entrepreneurs

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Idea Exchange: Advice For Young Entrepreneurs

By nicoj
Published: June 1, 2011 Updated: June 1, 2011

Getting started as an entrepreneur can be an exciting, and at times scary, thought for young people. First-time business owners face many challenges on the path to becoming successful, such as obtaining credit, complying with regulations, and building a customer base.

In May, we asked business owners in the SBA community for suggestions they wish someone would have given them before starting a business. Here are some of their tips:

Develop a solid business plan

johnhenning suggested having both a business plan and procedures set up before starting or purchasing a business: “systems and processes are important as well as a proven business model.”

wgalkin also stressed the importance of having a good business plan, saying: “The best advice I can give is to develop a detailed business plan. This can be a lot of work, but it serves to clarify and scope out many issues and also allows you to assess the costs.”

Focus on marketing

rcaldwell,  the owner of an appliance repair shop in Idaho, suggested having a dedicated marketing strategy to attract customers, rather than buying ads and hoping to lure business: “Do not think that just because you buy yourself a yellow-page ad that the public will come flocking to your business.” Rcaldwell also said that making your advertisements “quick and to the point” will help you effectively communicate a product to your potential customers.

wgalkin recommended accounting for significant marketing costs in the initial phase of a company.

Be strategic about financing

Ralph Alterowitz, the President of a Maryland venture capital consultancy, suggested getting a good sense of your financing needs, then taking the time to plan the best way to raise capital. Mr. Alterowitz shared his thoughts about the importance of having a good financing strategy: “After building a grounds-up budget—determining how much money is needed for staff, facilities, equipment, supplies and materials, testing, development and marketing—the entrepreneur needs to determine the fastest, easiest and least costly way to raise the money needed.”

Distinguish yourself from competitors

pfleet suggested trying to find ways to do business differently than rivals, in order to distinguish the business in a fundamental way. 

Prepare in other ways

JRDUNDON had three pieces of advice for young entrepreneurs deciding what to do before they start a venture: carefully choosing what type of entity would be best; learning the tax implications of decisions; and being willing to ask others for help.

Carrotandstick recommended getting information on the success and failure rates of similar businesses in the area before pursuing an idea: “If the last 7 pizza shop startups went bust, find out why before you spend any money on dough.”

About the Author:

Nico Janssen
My name is Nico and I'm serving as a moderator for the Community.

Comments:

Entrepreneurship is a hard road to take. I have seen many start-ups fail because they completely ignored one or all of these points you mentioned. Great summary, Nico.
I am an entrepreneur myself and have learned alot of lessons the hard way. I cannot stress enough the importance of having a good business plan and researching your market! Do your due diligence, and get all the info before you make the investment. I totally agree with all the points that were touched on in this article. There are alot of opportunities out there for young entrepreneurs who are willing to do the research and take the risk.
Overall a good post to motivate Young business Entrepreneurs, who sometimes acts rashly due to lack of experience, hence learning or gaining experience from the elderly person in business, always pays off, also one need to be little flexible while dealing with co mates, otherwise strong headiness ruins the party before it begins.
Do not think that just because you buy yourself a yellow-page ad that the public will come flocking to your business., it is so wonderful, it shows the truth of business, we must know it and follow it in business.
The basic management theory comes into play in this aspect which says "PDCA" cycle. It's Plan, Do, Check, Act (PDCA). You have done a similar description for that and its welcoming one. I would also add something called ROI or the Return On Investment made, which should be carefully monitored in order to gauge ones progress.
One of the things that I found most helpful in my business was to create an Advisory Board. Our first board had five members including a retired executive from our industry, a lawyer, a marketing person, a banker, an another business owner in a slightly different segment who did not compete. Preparing for and participating in these quarterly meetings helped me to grow my company much more quickly that I was able to do on my own. And when I outgrew one board, I took them to a nice dinner, thanked them profusely, and started again the next quarter with a new Advisory Board. I recommend starting with an AB as soon as you can.
That's something called a great thought as what is well said as "Sharing is Growing". The sharing of growth strategies and experiences as you said is worth welcoming and gives a path way for the one that are beginners. Good Going and Thanks A Lot.
Great advice and tips, than you very much Nico
Now a days all new young Entrepreneurs are growing faster than ever, all their new concepts are changing the whole world. I would highly recommend every young people who have interest in business and entrepreneurship than they need to educate themselves and focus on business if they want to become a businessman in future. And we has community help and encourage this young entrepreneurs than indirectly it will help to grow our business and the more we encourage this young entrepreneurs to start business they will create jobs for other people as well. So very inspiring content, Well done.
Very informative blog. Thank you for sharing. It's important to stand out from the crowd when you are a Yound entrepreneur. This post was edited to remove a link. Please review our Community Best Practices for more information about how best to participate in our online discussions. Thank you.

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