If you want to save money for yourself, your family and your future, one avenue you should consider is business. Starting a business is an excellent way to create savings for yourself if you can make it profitable. The Internet has changed how businesses are created. Before the Internet, it was difficult to start a business. You needed to go to a bank, get a loan and get an office to start your business idea. Today, the rise of technology and smartphones means that anyone can start a business as long as they have the drive to create a business that can be successful. Ready to create a successful business idea that will grow and that could be a savings pot? This is the guide for you.
Create your business idea
You need to come up with a business idea that makes sense that will generate cash regularly for you. First you need to decide between B2C and B2B. B2C is business to consumer, while B2B is business to business. B2C businesses are ideal for entrepreneurs who want to make money instantly because they can help you generate cash every single day. B2B companies can feature big projects with big payments but it can also take some time to get paid. Once you have chosen the format, you now need to get the business idea that will boost your personal finances.
The Internet has made e-commerce businesses some of the most powerful startups in the world. E-commerce is popular for entrepreneurs due to the fact that there are billions of consumers available who can log onto the Internet due to the rise of the smartphones. If you want to see success in e-commerce, you should choose a niche market. One area of e-commerce that is doing extremely well is the health and wellness segment. From health supplements to weight loss aids, e-commerce in this segment is also growing as more people look to improve how they look. Whether it is about weight loss or wellness, this market for e-commerce could be successful for you depending on how focused you are going to be about this.
Once you have your idea, you need to think about you are going to launch, grow and sustain it. When you are still in launch phase, you need to have a name, brand identity, website and an address. How do you plan on getting all of this done? If you are a go-getter, you will not wait until tomorrow. You will start today.
Decide if you are going to launch in a team or by yourself
There are many benefits to working alone such as being able to control the creative process of your business. Whether you are launching a design studio or a restaurant, you will be passionate about how your business looks and feels so you will feel inspired to do a lot of the work yourself.
The problem with working alone include the fact that you will feel lonely trying to grow your business because you will feel like no one knows how you feel as you try and create a successful business. You should consider having co-founders for your business so that they can share the stress with you. You should also look for partners or co-founders that have different skills to you. For example, if you are passionate about creativity, it is a good idea to find a financially focused partner who can keep you rooted in profitability and keeping expenses down.
If you are launching a technology company and you are not technically focused, you should find someone with an engineering background to complement your strengths. Finding the right partners is absolutely critical if you plan on growing your business and becoming successful. No man is an island and this is particularly true when it comes to launching a business.
Create an incredible product
If you are launching a consumer product, you need to create the best product that the market has ever seen. The consumer market is spoiled and they want products that inspire them and make them feel excited to buy the product even more. Many businesses have been inspired by companies like Apple due to their passion for creating products such as phones and laptops that people can use every single day. Whether your business idea is focused on design or function, you should create a product that is worth the money a customer will spend to pay for it.
If you are not a product driven person, pay a graphic designer to create design that will capture the hearts and minds of consumers. You should do plenty of research and see what kinds of products are popular now in the market.
Your business idea does not have to be physical. Mobile apps are the new gold rush and many engineers and entrepreneurs are doing well financially by creating mobile apps that are successful. You could make mobile games or paid apps and charge fees for them. You need to get to scale in order to reach profitability.
Create a marketing plan
Selling a product without marketing is like leaving your house without wearing shoes. Marketing is the fuel that keeps the engine of your business idea roaring. You should come up with all types of ideas to market your business. You don’t need to spend tonnes of money either. The growth of social media channels such as Instagram and Facebook have made the costs of reaching people low and attainable for almost anyone trying to do business.
Social media marketing can be done with the help of interns or you can try and build your social media marketing strategy on your own. Instagram is perfect for B2C companies that want to grow so if you are launching a fashion brand, you need to be on Instagram to see results.
Influencers are people who are famous on social media within a particular niche. It is a good idea to connect with influencers in your market so that you can promote your brand.
If you are selling a B2B service to corporate clients, marketing is going to require you being on LinkedIn and creating content that brings value to your customers.
Your marketing plan also needs to have a budget. You cannot promote and advertise without knowing how much you intend to spend on your business. If you over spend, you lose money but if you don’t spend enough, you will not be able to reach as many customers as you would like.
Create a seed capital fund
This is something that many entrepreneurs struggle with. Seed capital is needed to build businesses and to make a company successful. You can go to a bank, ask for a loan, or ask family and friends to help you. Additionally, you can start a business with a small amount of money that you have saved in order to get the company going. You should replenish this seed capital fund once you have recouped the money that you have spent on creating your business.
If you want to build a business that stands the test of time, you need to maximise profitability by keeping expenses low and create products that are profitable. Maintaining your profitability will mean that you need to increase sales so that you can funnel the profitability into savings. You cannot save if you don’t have profitability. Depending on your business model, you can see what is profitable because the numbers will instantly show up on your balance sheet. Your business likes profitability and will reward you for doing profitable things. One way to see what is profitable in business is by focusing on what products consumers or clients want to purchase.
Save 20% of your business income
One smart way of having business savings is by saving 20% of the income you get from the business and depositing the money into a fixed income deposit or savings account. This way you are paying yourself first from the profits of the business and keeping the money safe. You do need to reinvest the majority of your money back into your business especially if you are running a consumer products company. However, saving business income is critical if you are going to have a solid financial foundation.
Create a savings plan
Even if you are saving 20% of your business money, you should have a savings plan that you stick to regularly regardless of how much money you want to spend. If your business is making a £1,000 profit every month, you should save £200 at the end of the month without missing a payment. A savings plan can be weekly or monthly. Monthly is a better strategy so that you can reinvest in your business and grow at the same time.
Businesses can be difficult but they are cash generators if you have found the right business model. You should use business as a method to save money as long as you create a low capital intensive business. Technology and digital business do not use a lot of cash but are profitable for the people who run them.