1-9-2006
Starting a business? Eleven first steps to take.
By Bill Hoke

At least once a week I'm contacted by someone who wants to open their own business.

It's the American dream and I understand 30,000 new businesses are started every day in the western United States. I take these calls seriously and I'm frank to the point of bluntness. Really frank. Doing business frank.

Don't have a business plan? Take the time to write one. Not sure who your customers will be? Get ten committed sales before you begin. Buying a franchise or taking over a business? First, go to work in it and do every job.

It takes less than one hour to get your business set up. Just go on-line and follow the steps. It's as simple as 1.2,3.

But before you do that, consider these start-up realities from someone who lives this everyday:

  1. Ask yourself (and others), “Am I temperamentally suited to be my own boss?” Are you flexible? Out of the box? Do you thrive on chaos and unknown outcomes? Can you live without a pa check for months at a time? How much is health insurance?
  2. Another early question to get answered is to find out what your liability and other insurance costs are. There are some business categories that are so burdened with insurance costs they are not worth considering. Next?
  3. Restaurants in Washington State have an average net profit of 1.8 percent. That is so thin it is scary. Find out what the average profit margins are in your proposed business. How much merchandise will you need to sell or how many hours of your time must you bill to meet your overhead and expenses and pay yourself? You will need a sales plan. Who's going to make the sales, do the cold calls? (Answer: you will.)
  4. It is going to take three years until you can comfortably sit back in your chair and say, “I think we are going to make it.” Figure it's going to take the next three years of your life and you will work harder, and more hours, than you've probably ever worked.
  5. Do more research about your proposed business! Get help from our very good business librarians at Kitsap Regional library. Find comparable businesses and study them. Print their web sites, put them into a notebook and positively beg, borrow or buy a comparable business plan. Study to see how successful comparable businesses do it. Research is everything at this point.
  6. Contact at least five others (preferably 10) in this business (anywhere in the country - world) and ask them each these questions: How did you get started in this? How did you attract your first customers? What is the most effective advertising you do? Are you happy in this work… and would you do it again? Tabulate the results and listen to what was said. And unsaid...
  7. Mail (Hallmark) 'Thank You' cards to everyone who gives you any help or encouragement. Start right now and keep a contact database of everyone you meet, talk with. Use those thank you cards!
  8. Read industry publications. You need all the industry knowledge you can get, so subscribe to trade magazines, take classes as needed. This is high-energy work and if you don't find yourself loving to learn more about it, consider this a real warning sign. It may not be for you.
  9. Get your banker, a member of SCORE, or some financial expert to review and challenge your business, marketing and sales plans. Get someone to ask the hard questions and dig into it. Hard. No, it probably is not realistic to project that you are going to get 10 percent share of any market. Yes, it will take weeks or months to write a real business plan.
  10. Curiosity and enthusiasm; those are the two things that say “success” for me faster than anything. Bottom line: that's what I look for. You've got to be indomitable and make this dream come true through force of your will!
  11. Start your business based on your interests, experiences and skills. Use your expertise. Trying to learn about a new business and operating it at the same time is often disastrous. Follow your heart. And head.

   Discouraged yet? Maybe it's a good thing that you can be dissuaded from your dream in less than 600 words. Because starting a business in 2005 is not for the faint hearted. If you are still in and want to push on, then I wish you well and leave you with three words: research, research, research.

(Editor's Note: Bill Hoke is marketing and creative planner working from his home based business in Manette. He can be reached at hoke@hokeconsulting.com.).