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4 Key Factors to Consider When Starting Your Own Company

Millennial Magazine - starting your own company

Starting your own company is a daunting task. Every day you can read about the staggering number of small businesses that go under for various reasons, though nobody seems to be able to point out the continuous flaws in their approach.

There are so many things to consider, from the initial planning stages to the day-to-day running of the business. But with careful planning and by following these four key factors, you can give yourself the best chance of success.

A Unique Selling Proposition

That is what sets your business apart from the others in the industry. If you can set yourself out from competitors it gives customers a reason to choose you over them. There are many different business models and they have to have something unique in place so that customers stay interested and come back for more.

Numerous examples of this can be found throughout the world. Take ‘just-in-time delivery’ business practice for starters. This business model gives customers the opportunity to receive products quickly and efficiently while keeping costs low at the same time. Another one is McDonald’s, which was among the first to successfully offer a uniform business model at its restaurants across the world.

The reason so many business models failed for decades was because they all became too similar and their uniqueness lost an appeal to consumers. Today these things are sometimes easier to overcome with the help of a company formation agency in the UK. With such a saturated market, businesses had to come up with some way of differentiating themselves from others and coming up with some sort of business model that would be more attractive.

You need to keep this in mind as you begin planning your business venture. You can’t just copy what someone else has done and expect it to work – putting two similar businesses next to each other will never work: if people like product A, why would they suddenly like product B? Instead you have to be creative and try something new – or at combine multiple aspects into one business plan.

Competitive Advantage

The business environment is a competitive one, and if you do not have something that differentiates your business from the competition, you will soon see yourself going under. Just as it’s important to be unique from competitors, having a business advantage over them can work even better. That doesn’t necessarily mean being considerably more expensive or lower quality – it all comes down to what customers prefer.

For example, take the ‘build-a-bear’ business model where customers are invited to use various tools and accessories to create their very own teddy bear. This business benefits tremendously because its customers love the idea of customizing their product unlike any other business out there. Other similar ventures, like Subway sandwiches, are able to succeed because they offer a unique business approach: you can choose exactly what goes into your meal and pay for it accordingly.

Having a business advantage is crucial today especially when looking at company formation in the UK, where business competition is high and only those with the best business models will survive. There are so many ventures out there that all claim to be the best, but only one can actually take the number 1 spot – which one will it be?

Vision & Mission

Now that you’ve got the business advantage, top it off with a business vision and mission statement so customers know what they are getting themselves into. Customers want to use products or services that have an underlying goal or purpose – they want to know how their purchase contributes to society as a whole. It could be something as simple as being environmentally responsible, or even working for social justice.

Whatever business model you choose, ask yourself this question: ‘How does my business plan help others?’. By asking this question at the early stages of your business venture you will inspire creativity within your team members, allowing them to come up with business goals that benefit society.

If Elon Musk didn’t have a vision of changing the business world, he would never have come up with business ventures such as Tesla and SpaceX. The vision behind that business is strong and it shows in all they do – from business strategy to hiring employees that fit into their company culture. If Bill Gates didn’t have a vision for Microsoft then the business wouldn’t have achieved what it has today. Having a business vision will attract more customers to your business, making your business venture even more profitable.

Financial Plan

Your business plan needs to be sustainable in the long run, otherwise, customers will eventually find themselves not needing your services or products anymore because you cannot keep up with their expectations over time. Your business model should explain how you’re going to work out a financial plan and balance costs and earnings every month so that every expenditure is justified by its purpose of giving back to the business or helping others.

A good financial plan includes things like how much money you are going to invest before the business becomes profitable, how large an investment it’s going to be, and how long it will take for business revenue to cover business costs. There also needs to be some sort of business strategy on what revenue sources will be generated so that there is a steady flow of incoming capital.

You don’t want your business model getting ahead of itself and not thinking about the financials until later, otherwise, unforeseen obstacles could cause serious problems such as bankruptcy. Though that isn’t the end of the world – it certainly is the end of that particular business.

Starting a business is no easy task, but it’s definitely rewarding when done correctly. There are many things to consider when laying the groundwork for your company, but these four factors are essential in order to create a successful business. Having a unique selling proposition, competitive advantage, vision and mission, and financial plan is key to attracting customers and maintaining their loyalty over time. Make sure you take all of these into account when starting your own business – they will help you stay on track as you work towards success.

What do you think?

Written by Meghan Belnap

Meghan Belnap is a freelance writer who enjoys spending time with her family. She loves being in the outdoors and exploring new opportunities whenever they arise. Meghan finds happiness in researching new topics that help to expand her horizons. You can often find her buried in a good book or out looking for an adventure.

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