Before You Start:

Get Smart - Take a class or classes so you understand all the aspects of running a business. There are many free classes offered by a variety of institutions, nonprofit organizations and government programs. Find the ones nearest you or take a count me in class online. Be prepared and understand what it will take to be successful. Free information could save you time and worry later.

Get Credit - Get your credit in shape. No one wants to loan or give money to someone that cannot manage their money. Pay off as many bills as you can, save money, get a copy of your credit report to understand what it says about you, and build a solid record. Make sure you have credit cards that you can use in an emergency.

Get a Plan - Write a business plan - even a simple one to figure out who is your market, what your costs are, what you can sell monthly and annually, and what kind of money you can make. Do not start without understanding that you are priced, have the volume, and expenses realistic to make money. Answer the question first - before you commit everything you have to an idea. Not all ideas can make enough money to support you and the cost of running a business.

Checklist When You Start:

The Business: What are your Products and Services?
	Understand what type of business your starting. Have a clear definition of your products and services. Understand your strengths and weaknesses. Know your costs for producing items and what it will take to make your product or service.
Targeting Your Market: Who is going to buy your product?
	Identify your customers. Who are your target customers? Do not say everyone! Every business has a niche and a target customer. Figure out who your customer is for your product or service.
	Publicize your business. Let others know you are in business. Network and promote your business.
Business Operations: Where do I start?
	Determine your legal structure. What type of business will you organize and get the legally documentation in place. Obtain a book form your state secretary of states office on starting a business in your state. They should be free and have good information on the laws in your state.
	Find a location for your business. Determine the best site. Shop for the best prices and location for what you are doing. Read all leases and get advice if you need it. If you are going to start at home, find a spot and create your own home office.
	Write your business plan. Make it complete and do not avoid the weaknesses. All businesses have them and your job is to address them in a concrete and thoughtful way. Write down the plan. Take a class or get help to writing the plan. There are many great classes run for free by the SBA, Small Business Development Centers, Women Business Centers, and other nonprofit organizations. Take the classes now in the planning phase.
	Register the name of the business with your state. Most states have a process on line for registering names.
	Get business cards and stationery printed or do them yourself on the computer.
	Obtain any of the local business licenses that you need. Obtain a sales tax number from the state if you have to charge sales tax. File all of the legal documents that are necessary. Obtain a federal tax ID number if you have employees or are incorporated. You can phone the IRS for their free Small Business Tax kit at 1-800-829-3676.
	Set up the office with phone lines, computer line, etc.
	Hire employees. Create job descriptions, salary levels, and benefits before hiring. Recruit and interview several people before hiring.
Financing: Where do I get the money?
	Start your financing research and determine if you can borrow money. Determine your strategy for obtaining the money to start your business. How much money can you put into the business of your own? Is it credit cards, family and friends, bank loan or other financing? Chances are it will be a combination of all of these sources.
	Open a separate banking account for your business. Find a user friendly bank and open an account. The bank may require seeing a copy of your business license before opening the account.

Web Sites

• www.count-me-in.org
• www.onlinewbc.org
• www.sba.gov
• www.microenterpriseworks.org

Books

• Self Employment: from Dream to Reality: Gilkerson and Paauwe.
• The Real World Entrepreneur Field Guide: Growing Your Own Business: Bangs and Pinson
• Small Time Operator: How to start your own business, keep your books, pay your taxes and stay out of trouble: Kamoroff.
• The Business Planning Guide: Creating a plan for Success in Your Own Buisness: Bangs
• Start Up: An Enterpreneur's Guide to Launching and Managing a New Business: Stolze

10 Major Reasons Business Fail

Sponsored by Morgan Stanley

The following are important to review so that you might avoid some of the common mistakes of business owners.

1. Lack of adequate working capital - the business failed to anticipate how much working capital (operating expenses) it would take to run the business. They ran out of money before they got any income from sales.

2. Excessive cost overruns - Businesses that are building out space have cost overruns on construction and use up all of their working capital. (All of your working capital should go toward making sales - you need income now!)

3. Target market not identified - the business has no target market identified and uses up all of its marketing dollars on expenses that do not produce sales. Be careful of large ads to the general public, expensive flyers, or promotional sponsorship of events. Target! Target! Who is the customer and go after them?

4. Heavy Competition - the business underestimated the competition and it wiped them out. Larger or more established businesses can hold sales, reduce prices, and increase service. There may be more competitors than you anticipated. Do your research and figure out who the competitors are. Avoid starting a business in a heavily saturated market.

5. Franchise Difficulties - no all franchises are legitimate. Check out your franchise opportunity. How many products do you have to buy? What are the fees? Read the legal document to see who and why they have been sued.

6. Pyramid Schemes - there are many pyramid schemes on the web and advertised on TV. Watch out. Think about it - after you sell to your family and friends - who else can you sell to. These are scams that get their money upfront and you end up with software, product, etc but no customers.

7. Management Turnover - key personnel leave the business. Partnerships break up. Be prepared for change.

8. Unable to meet projected sales goals - be realistic in your planning. Too many businesses set very high sales goals and then can not reach them. The expenses were often projected too low and the sales too high. Think carefully about your projections. They become your goals that you need to meet to be successful.

9. Tax problems - pay your taxes on time. The penalties add up, the IRS can close you down. It is tempting to use tax money for cashflow or working capital. Don't it will create a bigger mess.