This is a guest post about starting a business with cash is from Resa Troyer. She is a blogger, entrepreneur, owner and COM (Chief Operating Mom) of Resa Design, LLC. It is a very chic and cool clothing line for babies and small children. Find out more at resadesign.com
In 2005 I started Resa Design, LLC. We are an independent clothing and accessory line geared toward modern children. These are some of the most valuable lessons I have learned.
1. Sit on your idea.
Do you think you have a great idea for starting your own business? Write it down. Write down all your thoughts surrounding your idea. Then put it under your mattress, or somewhere it won’t get thrown away. Every time it comes back to your mind, pray about it. Try to think about how it would really work for you. If after a few months, or years, you just can’t get your idea out of your head, and you’re still enthusiastic about it, then go for it. Not jumping into something based on initial excitement will help ensure the longevity of your business.
2. Cash is king.
I think many people don’t follow through with their big idea because they don’t know where the money will come from. I started very small, and had the luxury of being able to start with cash. Fifty here, a hundred there, it added up, but it wasn’t a bit outlay all at once. And once I started making money, I reinvested it right back into the company. After about a year the business was supporting itself and by the middle of year two I had paid myself back. Although I realize that for some industries this is not possible, starting with cash helps limit your risk and keeps you away from those dangerous credit cards.
3. Keep it simple.
Your idea might have twenty parts. Start with one. Find a niche that your competition isn’t serving. Learn from Starbucks and Sears and all those other companies that have hit hard times through the years because they were “all things to all people.” If you make and sell great coffee, stick to coffee. No one expects to walk into your shop and buy music and get bad coffee. They want your best coffee. Stick to that and let them go somewhere else for the music.
4. Do your homework.
Before you even put a dime into your big idea, do your research. How is your business/product different from what is already available? Is there a market for your idea? Is your product/service affordable? With the Internet available, this is an easy task. Spend a few days scouring the Internet for all the businesses you can (or can’t) find that do anything similar to what you are setting out to do. For example, I am asked all the time if Resa Design would make baby slings. My answer is always no. The market is over saturated and I don’t feel it’s an area that would be worth the investment. On the other hand, we could not find a cool sibling tee anywhere, so we designed our own. They sell like hot cakes.
5. Start small.
Start where you can afford to (see #2). As a rule of thumb, buy only what you need for the moment. This will help your costs remain low, although it will take more of your time. As you grow you will have to make adjustments, and you¹ll have a better idea of your cash and supply flow. But while you’re starting out it will help you keep things manageable, explore the market a bit more, and experiment with the whole “running a business” thing. Maybe it’s really not for you after all. Better to learn that when you don’t have too much invested in it, then later.
6. Ask for help.
Now, don’t be a mooch, but find out what your friends and family can do to help you. Trade your service or product for theirs. Swap babysitting, pet sitting, or even pay for their services. Often times, those around you will be excited to be part of what you are doing. They may be glad to help, but never expect them to do it for free, even if they offer. You’ll be glad you paid, even a little something, when you get their best work and in a fair amount of time.
7. Learn every area of your business.
I am a social worker by education. Business is not my forte and although I have developed more interest in it over the years, it’s not really my favorite subject. I do get multiple business magazines, and read books as often as time allows. I try to soak up all the knowledge I can on everything that relates to my business in its current and future states. Even if you hire someone to do your taxes for example, you are still responsible for what is filed, so you need to know as much as you can about what your accountant does for you. Along your journey you may even discover some hidden talents or an area of business that really interests you.
8. Team up.
Make friends with other people in your industry. You might even consider meeting your competition. You can start by finding an online group or forum for people doing what you aspire to do or are already in your industry. Most of the designers I have met have been amazingly helpful. I can’t begin to count the number of times another designer has helped me out. My husband calls them my virtual friends. We have never met, or spoken, but I have a team of designers just clicks away that are ready to share what they have learned, cheer with me, or even encourage me when things get tough. This was one of the most unexpected benefits I have received from Resa Design. I chat with some of them everyday.
9. Trust God.
The Lord causes my thoughts to become agreeable to His will, and so my plans are established and succeed. (Proverbs 16:3, AMP) I pray this verse over Resa Design all the time. I am confident that God has given me skills and talents, the idea to start Resa Design, and that He has a great plan for my success. Owning my own business is like having a child. It grows and changes everyday. I have to be flexible, yet wise as I mold it and direct it in the way it needs to go to be prosperous. Above all else, I trust God will lead and guide me in each step, purchase, decision, and interaction that I make.