PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Starting a Business in 2021? Here are Some Valuable Tips and Advice

By at 31 December, 2020, 8:48 am

by Raymond J. Keating-

As we all know, 2020 has been a brutal year in terms pandemic-related deaths, illnesses and economic devastation. That includes, no doubt, millions of closed small businesses.

At the same time, a glimmer of hope for the future of our economy can be found in the data for Employer Identification Number (EIN) applications. The Census Bureau’s business formation statistics offer a weekly look at EIN applications. These applications include those looking to start new businesses, and are broken mainly into overall business applications, and high-propensity business applications, which are a subset that have a higher likelihood to turn into businesses with employees. The number of applications amounts to a rough, forward-looking measures of potential business startups.

The latest data reported on December 30 for the week ending December 26 show that such applications were up by 41 percent compared to the same time last year, with high-propensity applications up by 32 percent.

These numbers really offer the lone positive take on the state of entrepreneurship during this pandemic economy. Hopefully, it reflects a renewal of entrepreneurship post-pandemic.

For those who are thinking about starting up or are preparing to open a business in 2021, how about some tips?

Here are a few – some I have shared before and others I came across recently – that might carry additional weight post-2020.

1.) “Why 2021 Could Be the Best Year For You to Start a Company” by Kelly Wing, CEO and Founder at Ohwabisabi Media, Entrepreneur.com.

Here’s a key point in favor of taking the plunge into entrepreneurial waters in 2021:

“Consumers’ ever-increasing problems mean they’re seeking more solutions than ever. It’s now become easier and more accessible for everyday people to start businesses such as e-commerce, virtual assistant work, coaching, or becoming a freelance writer, designer or developer. E-commerce has spiked by nearly 40% in the wake of Covid-19.

“If you think about how your own consumption and purchasing behaviors have changed over the last few years, it’s easier to spot trends in where we are heading in the world of consumption and business. If you think about what solutions you wish you had, that aren’t currently being met, chances are there are others looking for the same solutions.”

2.) “10 Tips For Starting A Small Business That You Haven’t Heard A Thousand Times Already” by Make Kappel, founder and CEO of Patriot Software, LLC, at Forbes.com.

Kappel provides a solid list of 10 items. The following is crucial for new entrepreneurs to consider:

Quadruple Your Cost Estimates. “Once you start to develop your business idea, add up how much it will cost. You will need to factor in every business expense necessary to launch and operate. Some costs to keep in mind include your location, rent, supplies, marketing, and more. Come up with the most educated number you possibly can. Then, take whatever you think that dollar amount is and quadruple it. Seriously, quadruple it. You’ll experience unexpected costs of running a business around every corner. It’s better to be over prepared than short on funds when bills start to roll in.”

3.) “Ten Tips For Starting A Business That Will Succeed” by Ebraheem Al Samadi, Founder and CEO of Forever Rose, at Entrepreneur.com.

Among Samadi’s 10 tips the following is essential:

Don’t Quit Your Day Job. “Start your business while you’re still employed. How long can most people live without money? Not long, and it may be a while before your new business actually makes any profits. Being employed while you’re starting out means you will have money in your pocket to invest into the business, as well as to ensure you are able to keep up with your monthly living expenses.”

4.) “So, You Want to Be an Entrepreneur: First, answer these questions to see if you have what it takes” by Kelly K. Spors at The Wall Street Journal.

Among the questions asked in this Journal piece, here’s a vital one to ponder:

Can You Handle All Aspects of the Business When Starting Out? “Do you like all aspects of running a business? You better. In the early stages of a business, founders are often expected to handle everything from billing customers to hiring employees to writing marketing materials. Some new entrepreneurs become annoyed that they’re spending the majority of their time on administration when they’d rather be focused on the part of the job they enjoy, says Donna Ettenson, vice president of the Association of Small Business Development Centers in Burke, Va. ‘All of a sudden, they have to think about all these things they never had to think about before,’ she says.”

5.) “9 Lessons From 9 Years in the Side Hustle Trenches” by Beth Newton, Entrepreneur Leadership Networker contributor, Entrepreneur.com.

Two points are worth taking away from this article:

● “Adults have been side-gigging, freelancing, and hustling for decades. Social media, the accessibility of modern technologies, and a shift to remote work have made starting a side hustle easier, faster, and less expensive. If you’re hustling for work on the side, regardless of the industry, two things are likely true: You’re good at it, and you enjoy it.”

● “The minute you stop selling your business, you’ve lost. No matter how busy you get, you can’t take a break from looking for new business. Earmark a specific day and timeframe each week to focus exclusively on new business.”

6.) “Starting a Business in 2021? Read These 5 Tips First” by the editor of HoneBusinessMag.com.

The final tip here is vital in a crowded marketplace, i.e., differentiate. It is noted:

“If you’re entering a competitive marketplace, you’ll need to look and feel different to your competitors — it’s not about style over substance, but rather a matter of caring enough about what you do and the way you do it to find novel ways of expressing that through your branding and customer service. For starters, a good look at brand archetypes will help you develop a distinctive voice, tone and style, which will in turn inform everything from your copy and messaging to brand logo, colors, and values — find out more in this article from Medium.”

Good stuff, and good luck in 2021!

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council.

 

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