Tips for Starting Your Small Business

Do you dream of being an entrepreneur and owning your own business? You aren’t alone. In Nova Scotia, there are nearly 29,000 registered small businesses. If you are thinking about making the jump into the world of business ownership, here are a few questions to ask yourself:

Have I done my research?

If you have an idea for a product or service to start a business, it is important to ensure that there is a demand for your product or service. If you are interested in opening a coffee shop, for example, you will have to make sure that there is something about your coffee that sets you apart from other coffee shops - something special that will make people want to come out of their way or pass by your neighbours store front to come buy your coffee.

The location of your business is also incredibly important. If you don’t need a physical storefront, like a coffee shop, to start your business, this could make your business more viable in the early years, as you will likely have less overhead expenses.

Are my finances in order?

What many people may not realize is that in order to get a loan for your business, your personal finances need to be in order. This means the lender will consider the 5 Cs of Credit and how they apply to you. To increase your chances of being approved for a loan, ensure that you have a strong credit history, a positive net worth, enough capital to contribute to the project and that you have a well thought out business plan. It may also help if you have another source of income. For example, perhaps you are going to keep working full-time and start your business on the side or your partner is going to continue to work full-time and their salary can pay your household bills while you focus on getting your business up and running.

Do I know how to run a business?

If you plan to start a business, having a background in business fundamentals will be an advantage to you. For example, opening a coffee shop will likely be an easier process for someone who has been working part-time in coffee shops since they were a teenager and is now managing a shop for someone else, as they will already know many of the ins and outs of the business. If you don’t have experience working in the industry you’re interested in or are unsure of how parts of a business work, consider consulting a professional to help you work out the details.

How much risk am I prepared for?

As an entrepreneur, you have to prepare for risk. The industry you work in, your business model and other things will determine the level of risk for your business. No matter what industry you’re thinking about getting into, it’s best if you have a fall-back plan, like another source of income or a healthy emergency fund to support you if things don’t go according to plan.

Do I have a business plan?

The answers to all of the questions above will help formulate your business plan. This plan will show all of the research you have done on the industry, market and demand for your product. You will also include your own resume, highlighting your most relevant experience as well as all of your financial information, both your actual circumstances as well as projections for your business.

If you would like help writing your business plan, CEED is a great resource for entrepreneurs in Nova Scotia.

Will I be approved for a loan for my small business?

If you need a loan, as most people do, to get your small business up and running, you’ll want to ensure you have the answers to all of the questions outlined in this article. Obtaining financing for your business is about more than having a business plan or having good credit. It’s a combination of everything we’ve outlined in this article.

Being an entrepreneur is both challenging and rewarding and if you can answer these questions, we would love to talk to you about your business. Contact a member of the Commercial Team and we can get started on helping you make your dream a reality.

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