Why A Tough Economy Shouldn’t Damage Entrepreneurship
Small businesses in the US are the bread and butter of innovation; Good news for small businesses also often means good news for the country and local communities alike. While starting a business may appeal strongly to the entrepreneurial American spirit, how are start-ups and smaller businesses faring in the uncertain economic climate?
One leading newspaper recently ran an story on small businesses that didn’t make it through 2011, but things aren’t all doom and gloom. In fact, according to research from the National Federation of Independent Business (NFIB), lending prospects look better for 2012 than they have done in recent times and there is a growing sense of optimism in the small business sector as many predict a certain level of growth across the year.
Setting up a business can be tough though, and not everyone is lucky enough to see it through. For every successful idea there are many that don’t make it. However, there are certain steps you can take to ensure that your start-up starts up with the best possible chance of making it in a fickle and sometimes unsteady world.
There’s no denying it’s a tough market to raise capital in order to get started, but it’s not impossible, and it may even be getting better. A sound business plan will help others understand how your business will work practically and financially and can give you greater confidence knowing exactly how much risk you yourself are exposed to by taking matters into your own hands.
Starting out in business, perhaps unsurprisingly, takes more than a good idea. What you really need is a good idea that will appeal to a target market and make them want to buy your product. According to the survey by the NFIB poor sales is cited by a quarter of small businesses as the top problem that they face. Nevertheless, and this is where starting in business draws some similarities with other types of investment, though the nation is in the economic doldrums wise choices can still generate a return.
As with other types of investment starting a small business requires strategy and plenty of it. You don’t invest in someone else’s company without considering how well their product sells, and how well it is likely to sell in the future. Likewise when starting your own business your business plan sets out the findings of your own research into projected sales and potential for increase, and there’s your investment strategy.
The national economy is by no means in recovery yet, and much depends on international monetary health, but reports of a marginal rise in optimism and falling unemployment could mean a better year all round. Careful planning can help make your idea a success even in difficult times.
This post was written by John Hughes who is the resident blogger at http://www.independentfinancialadvisor.co.uk , a UK based site that provides access to financial advisors as well as to debt advice charities for those struggling with their debts.