According to a study from Vistaprint, 62% of people in the U.S. want to become business owners. But how many actually know what it takes to start, run, and grow a business? And is it the right time in their life to begin one? “Not all ideas are unique, and they are not given to just one person,” said Toni Coleman Brown, founder of the Network for Women in Business, in an email interview with The Balance. “It’s the person who takes action [who] eventually wins. Therefore, as soon as you get an idea, you should act on it.” Entrepreneurs cite many reasons for starting their businesses, including disliking their current job, needing a creative outlet, or just feeding a desire for more money. Regardless of what motivates you, the timing and reason for establishing a business must be purposeful. Here are some important steps and considerations to determine if it’s the right time to bring your business venture to fruition.
Research and Find Your Target Audience
At the heart of every great idea is who you intend to serve. Your target audience comprises the people who need or want your product or service, and, in turn, can help your business become successful. Studies have shown that a large majority of new businesses fail. One reason? The product or service was not a good fit for the chosen market. To find out if there even is a market for your business, doing research is critical. According to the Small Business Administration (SBA), the keys to discovering your strengths and unique selling propositions, and ultimately identifying your target market, are:
Conducting market research, such as gathering demographic data on age, population, and wealthAnalyzing consumer behavior and economic trends
For example, Jazmine Thompson established her vegan hair care brand Winnie & Co. after not being able to find moisturizing products for her daughter’s hair. “In my search to find the right product for my daughter, I realized other moms were having the same problem,” Thompson said in a phone interview with The Balance. To develop her vegan-based hair products for young children, Thompson used her membership in Facebook parenting groups to communicate with other mothers and get feedback on their needs. This, in turn, inspired her to put thought into action and start her business.
Test Out Your Idea on the Target Market
If you have a business idea, but are not sure that it’s going to work, the best way to find out is to test the waters. In 2019, Tonita White, owner of Dopely Lit, had an idea to launch a home fragrance, with the goal of marketing soy-based candles to who she refers to as the “urban” consumer. “I just kept coming back to the idea of a home fragrance line,” White told The Balance in a recent phone interview. “I needed a creative outlet, and I wanted it to be something I loved and enjoyed.” The busy mother of twins decided to start small and test the market by creating two fragrances. White then made a budget for supplies and opened pop-up shops. After trying her business idea and realizing that people loved her products, the entrepreneur decided to move forward in 2020. She developed a website and a social media presence to flesh out her business. In addition, White expanded her line to include a holiday fragrance and candle melts.
Do You Have the Time, Energy, and Resources?
If you are ready to launch a business, you will need to have time to devote to it, energy to push through difficult times, financial resources, and a network that will support your endeavor.
Time and Energy
While you may be anxious to get your business started, time is a crucial factor you need to consider, especially in regards to your home and professional life. For instance, say you are a stay-at-home mother with small children but without many child care options. Launching a business that will require you to be available to clients throughout the day might not be a realistic option. Or, if you have a demanding profession, launching a business that is just as demanding might cause you to burn out quickly. You should still believe in the value of your idea. Just consider how you can fulfill your vision in a more reasonable way. “Patience is important,” Teresa Satchell, business strategy coach and founder of Kingdom Legacy Partnerships, told The Balance in a phone interview. “There are seasons of life and seasons in business. Due to life or circumstances, you will have to adjust or provide fewer services, but it does not mean you stop.”
Financial Resources
How do you plan on funding your new business? For many entrepreneurs, launching a business will mean creating a budget for legal structure, operating costs, marketing, and supplies. And as part of running your business, you will have recurrent expenses. The amount of money you need to run your business depends significantly on the type of operation you are establishing. For instance, an entrepreneur who is starting a blog will have very few expenses. Yet, someone launching a business that requires a storefront or lots of equipment will need a business plan and good credit to finance their idea. As you consider whether now is the right time to start your business, ask yourself these important financial questions:
How much money do you have saved to fund your business? What does your credit look like, and will it help or hinder you from starting your business? If your credit is not good, what do you need to do to build your credit so you’re ready to launch your business? What startup capital do you need to fund your business? What are your business expenses? How will launching this business help or hurt your personal finances (especially if you quit your job to start this business)?
Network Support
The ability to network with others—through social channels like LinkedIn and industry-related professional organizations, for example—is crucial to starting a business. “Before starting a business, speak with a business consultant to help you make a wise choice,” Satchell said. “Entrepreneurship is a journey. Connecting with people in the right partnership will propel you to the next level. You need to meet the right people and make connections.”
Seasonal Considerations
The time of year may also influence your ability to start a business. Some people may start businesses at the beginning of the year because of the belief in a fresh start associated with a new year. Others, meanwhile, may believe that establishing a business should happen when the market is suitable to embrace their offering. For instance, if you are a baker, it makes sense to begin planning your business over the summer. By the fall, you can market your business offerings with tasting events in order to be ready for the holiday season.
You’ve Made a Plan
Whatever your industry, the best way to launch a business is by developing a robust and strategic business plan and being realistic in your ability to execute and sustain it. Running a business, after all, requires dedication and an understanding of your target audience, your industry’s economic outlook, and your own financial capabilities. However, a strong business plan, complete with your competitive and market analysis, can reinforce your vision—and help turn your idea into a reality at whichever time feels right for you.
