Featuring Wendy Baumann, President
Wisconsin Women’s Business Initiative Corp.
How can a prospective entrepreneur know if he or she is ready to start a business? This checklist helps you identify what you need to know and what you need to do to start a small business.
Small Business Administration
Interview with Wendy Baumann
Ron Johnson: You are listening to the SBA, Small Business Training Network, your small business resource. I’m Ron Johnson. Owning a business is a dream for many Americans. But what does it take to turn your dreams into reality? How can an entrepreneur know if he or she is even ready to start a business? Is there a checklist that can be used to help guide you? With me today to discuss such a checklist for starting a business is Wendy Baumann. She is president of the Wisconsin Women’s Business Initiative Corporation in Milwaukee. SBA provides funding for more than 100 women business centers nationwide designed to help women start and grow their small businesses. Welcome, Wendy.
Wendy K. Baumann: Thank you. It is a pleasure to be here today.
Ron Johnson: Now, Wendy, what are the key items on the checklist?
Wendy K. Baumann: Well, really, you first have to identify and understand the reasons of why you want to start a business. I often ask entrepreneurs or business owners in the early stage to hold out their hands. What is the “who” behind this business? The “what” behind this business? When, where, and most importantly, really, why?
You need to begin at this early stage of doing a self-analysis of your own skills and your experience. You really have to look very carefully early on. Is this business idea viable or feasible? And then ask yourself the hard question, do you have the capacity and the interest to carry out this viable business idea?
And then, finally, still at this early stage is, I think we really need a plan, a written business plan as ideas, something ideal. Something happens when you take all those ideas in your head and really begin to put them down on paper in a formidable plan for yourself and then other supporters along the way.
Ron Johnson: Why is it so important to understand your reasons for wanting to start a business?
Wendy K. Baumann: It is really central to the business plan and to why you are going into business. For instance, I hear a lot of people say, “Ah, I do not want a boss. I do not want to have a boss again.” And I will often say to them, “Well, actually, when you go into business for yourself, every single one of your customers is really a boss.”
So you need to think of why you are going in. Is it because you have an idea and invention and want to bring that to market? Do you believe perhaps you can do something better, faster, different in terms of a product or a service? Do you see a niche in the market and want to go into that niche in the market? Do you want to make a million dollars?
All of those can be very good reasons, but your business plan will look different and your plan in pursuing this business idea will look different depending on really what are the why’s of starting that business.
Ron Johnson: And Wendy, you mentioned the importance of doing a self-analysis. What do you mean by this?
Wendy K. Baumann: Well, in terms of analyzing, do you as an individual, are you an entrepreneur, really? Are you an entrepreneur? Are you somewhat of a risk taker? What is your business acumen and what do you feel about that?
Entrepreneurs generally are a little bit more risky takers. They are a little bit more those leaders and you need to ask yourself early on, what do you think about leadership? Do you enjoy that sense of competition? Do you like getting ahead? Do you like winning? What is your energy level in running a business? Because most business owners, especially in their first and early stages, it is not a nine-to-five job. Sure you might be on in a retail environment nine to five, but when are you doing the books? When are you doing the hiring and firing when you are looking at your business plan and looking at your projections, your financials? So once you have really asked hard questions and you can answer “yes” to most of them or have good answers, then it might be the time that you are really suited for entrepreneurship.
Ron Johnson: How do you determine if a business idea is feasible?
Wendy K. Baumann: An ideal situation is often a niche in the environment. And by this again, I mean, okay, a niche business is not a coffee shop; a niche business is not a restaurant; a niche business is not a construction company. But it might be niche in terms of where it is located. It might be niche in terms of the type of coffee, the type of food, the specific market available in construction right now. So you need to see if there are some niches to be filled.
And second, again, you need to look at the service of this business. Maybe there are many coffee shops, but maybe they are not of a certain kind of nature, a certain kind of service. You need to see what is going to be unique and distinguishable about your business.
One thing that I love is when customers or when entrepreneurs say, “Ah, there is no competition at all in this whole area.” But then you have to ask yourself a little bit, why is not there any competition? Maybe there is not a market for it.
Ron Johnson: The last point you mentioned was business planning. Why is this so important?
Wendy K. Baumann: Business planning really is critical and we really like to see individuals with that business plan. It is a blueprint. It is a map. It is a guide to going where you eventually want to go. It is an idea you talk about, you know, the idea itself of a business. One needs to talk about the market for that business, which is a really key part, the products, the services, the team and the management, if it is a self-proprietorship, if it is going to be a team of individuals.
What are the financing for that business and how does this plan really link that all together in terms of the words and the numbers that taint the story of ideally a successful business unfolding?
Ron Johnson: If you decide to go ahead and become an entrepreneur, check out SBA’s online small business training network at www.sba.gov/services/training. There you will find more than 25 free courses on all aspects of business ownership. SBA also offers many resources to assist entrepreneurs in starting or growing their small businesses.
These resources include more than 60 district offices with at least one office in every state, more than 10,000 SCORE counselors who provide free business counseling, over 1,000 small business development centers, and more than 100 women business centers. You can learn more about all of our resources at www.sba.gov.
I would like to thank Wendy Baumann, President of the Wisconsin Women’s Business Initiative Corporation in Milwaukee, for providing a checklist for starting a business. We will see you soon.
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