HOW
to START YOUR BUSINESS
See Also:
HOW to START YOUR BUSINESS
Starting a business can be
a risky venture (job or
undertaking) for adult as
well as young
entrepreneurs! It takes
time, money, and hard work
to make a business
successful. This is true
for both adult
entrepreneurs and for
young entrepreneurs. The
first step, in starting a
business, is knowing if
owning a business is right
for you! To find this out,
you must decide if:
-
you have the time to
start and run your
business,
-
you have the money to
buy the equipment (if
needed) or the supplies
to start and run your
business,
-
you can borrow some of
the money that you may
need to start your
business, and
-
people will buy what
your are selling, that
is, your product
(lemonade) or service
(baby sitting, lawn
maintenance - cutting
grass, shoveling snow,
raking leaves, etc.)
If you answered "yes" to
all of these questions,
then owning a business may
be right for you! Now, the
next step is to find out
or discover what type of
business you want to run.
In other words, what do
you want to make or do
that people will pay for?
DISCOVERING YOUR
BUSINESS
Discovering what type of
business you want to run
can be a tricky question
to answer. Some people
turn hobbies into part- or
full-time businesses,
while others run
businesses on a part-time
or full-time basis.
Whether you run a full or
part-time business or make
your hobby a billion
dollar business
enterprise, you need to
know two important things:
-
do you have the skills
and/or talent to run a
business, and
-
is there
a market for what you
are selling, in other
words are people -- the
market -- willing to buy
it?
To find out if you have
the skills or talent to
run a business, ask
yourself questions such as
these:
-
What do I know about
starting and running a
business?
-
What kind of business do
I want to start?
-
Do I really what to give
up baseball, hockey,
soccer, basketball,
football, dance, piano
and voice, or hanging
out with or going to the
mall with my friends to
run this business?
-
Will I have to run my
business every day or
just sometimes?
-
Will running my business
have an effect on
school?
-
Will my parents and
brother(s) and/or
sister(s) help me out?
-
How much money, if any,
will it cost to start my
business?
-
Where will I get the
money to buy the
supplies or equipment I
may need to run my
business?
Next determine whether
or not there is a market
- people willing to buy
what you are selling -
for your product or
service. Ask questions
like these:
-
Will people want to buy
what I'm selling?
-
Who will most likely buy
what I'm selling and
why?
-
How will people know
about my business?
-
Will other teenagers be
selling the same thing
that I'm selling?
-
If other teenagers are
selling what I am, what
will make my product or
service so different
that people will choose
mine over theirs?
-
What combination of
advertisements
(announcements) will I
use to get people to buy
what I'm selling?
-
How much will it cost
and how often will I
need to advertise?
-
Where will my business
be located at my home,
in the backyard, at a
stand?
Now that you have answered
these questions, you are
ready to start writing
your business plan.
Following is an outline of
the parts that make up a
business plan and a sample
business plan that you may
use as a guide. Have fun!
BUSINESS OUTLINE
Plan
I. Front Cover -
identifies the business,
address, its owner(s), and
important officers
II. Statement of
purpose - a sentence(s)
that explains the
intention of the business
III. Table of Contents
- lists the various
sections of your business
plan by page number
IV. Business
Description
-
Description of the
Business - describes
your business - the
product or service that
you are offering, its
location, and target
market. Throughout this
document "market" refers
to the people who are
willing to buy what you
are selling
-
Selling (marketing) -
explains how you plan to
sell your product or
service. In other words,
how you will reach
customers or clients
-
Rivalry (competition) -
identifies other teens
who are selling the same
product or offering the
same or a similar
service
-
Operating procedures -
explains how you plan to
run your business daily
-
Personnel - lists all
employees, including
yourself, and tells
about their jobs
V. Financial Data -
money details
-
Loan agreement - a
written understanding or
bargain between you and
your parents, or some
adult who has agreed to
lend you money to start
your business
-
Equipment/supplies -
-
Equipment - any tools
or gear that you may
need to run your
business (for example,
bicycle, lawn mower,
PC)
-
Supplies - materials
that you may need to
run your business (for
example lemons,
sweeteners, printer
paper)
-
Balance sheet - a paper
that shows the owners
net equity after
calculating assets the
difference between you
assets and your
liabilities.
-
Breakeven analysis - a
paper that shows how
many days, weeks, or
months it will take for
you to start making
money, based on the
money that you make
minus what you owe (for
example:
-
Week 1 income
$45/week. Debt -
$55/week. Difference
$45 - $55= (minus
$10.00);
-
Week 2: income $45.
Debt $45. Difference
$45 - $45 = $0. The
zero remainder
represents the
breakeven point, which
is when the money you
make equals the money
that you owe. After
you reach breakeven,
you can begin to make
a profit.
-
Income projections - a
paper which shows how
much profit you will
make based on the
difference between your
monthly revenue and your
monthly expenses (See
Business Plan for
examples).
-
Cash Flow - a paper
which tracks the amount
of money that you make
and the amount that you
pay out (See Business
Plan for examples).
VI. Supporting Documents
-
Loan agreement with
parent or responsible
adult lending you the
money to start your
business
-
Personal Assets is a
list of all valuables
that you own
-
Survey results are the
focus groups surveys
conducted to determine
if there are people
willing to purchase what
you are selling
-
Supply/equipment list
identifies all the
supplies and/or
equipment that you will
need to start and run
your business
-
Equipment lease
agreement a bargain
between you and your
parent(s) or responsible
adult which allows you
to borrow any equipment
that may be needed to
run your business. This
may include lawn mower,
rake, plastic or paper
lawn bags, etc.
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