As a startup entrepreneur, sometimes you wish you had a crystal ball to look into the future: will my product or service be a success or not? As a startup, there are a few things you can do to increase your chances of success.
1. Start from a realistic budget
There are always exceptions, but the vast majority of startups don’t have an unlimited budget during the startup phase. And to get a business off the ground properly, you will need to invest in certain things. As a starting entrepreneur or self-employed person, this often initially involves business equipment that you need to be able to carry out your work. Think of good computer equipment for a copywriter or consultant and a van for a contractor.
- While you will be pulled from many quarters to spend more money (with respect to investing, advertising, etc.), you, or your financial advisor, need to keep an eye on which expenditures have priority. So your financial mantra in the early stages of your business should not be so much ‘the sky is the limit’, but rather ‘who saves, has what’.
- If you keep enough money in reserve in the beginning to absorb any setbacks, you are less likely to get into financial trouble. And that billboard at the local sports club? You can still do that in six months’ time.
2. Calculate the right rate
One of the most important decisions you have to make as a starter is to determine the cost price: what am I going to charge for my product or service? How tempting it may be in the start-up phase to trump your competitors with absolute rock-bottom prices, this is usually not such a smart move. Using a low entry price to win as many customers as possible makes it virtually impossible to raise your rates at a later date.
From the customer’s point of view, a super low rate can also have the opposite effect: cheap is expensive and what costs nothing probably has no value. It is therefore better to use a market-based price from the start, so that you maintain a good starting position for negotiations. Curious about how to determine a good rate in your sector? Read all about it in the article What rate can you charge as a self-employed person?
3. Avoid the classic ‘work from home pitfall
Working from home: it sounds like music to many people’s ears, but you must have the necessary discipline. The chance that you are distracted from your work at home is much greater than when you are in the office and as an independent entrepreneur you will soon no longer have a boss who is chasing you to finish a certain assignment.
The danger then exists that you sit down in front of the computer in the morning neatly on time, but at half past five in the evening you have actually done very little concrete (the laundry had to be hung up in between, take your son to field hockey lessons, all sorts of things happened on social media etc.). This is not very effective in the long run. The solution is obvious: make sure you learn to distinguish between work and private life.