兔子先生

The success of your business will partly depend on your attitude and skills.

This means being honest about a range of issues.

You should think about:

• the knowledge you have
• your financial status
• the personal qualities that you can bring to your new business

Commitment, drive, perseverance and support from family and friends will go a long way towards changing your business idea into reality and will be especially important during the early days.

South Tyneside is a great place for businesses to flourish.

With a population of around 150,000 as your potential customer base, excellent transport links into the Borough and a flurry of seasonal visitors. 

Setting up your own business in South Tyneside needs your full commitment.

One way to find out about the day-to-day realities of running a business is to talk to people who are in business already locally in South Shields, Jarrow, Hebburn or the surrounding villages.

There will be lots of "ups and downs" that you should be prepared for.

Below are some of the challenges you need to think about.

Personal sacrifice

The more you put in, the more you are likely to get out. 

Starting up in business will physically and emotionally affect you and this should not be underestimated. 

It is life-changing and will require hard work and long hours, especially in the early stages.

Financial insecurity

There may be times of financial uncertainty and this could have a knock-on effect for both you and your family.

For example, being unable to afford family holidays. 

If you have invested personal savings or used your family home as security, in the worst case scenario you risk losing your investment or even your home.

Loss of company perks

Setting up your own business means that you may not receive the benefits often associated with a permanent job.

This includes the loss of 'safety net' benefits such as:

• pension rights
• sick pay
• paid holiday
• other company perks

Pressure on close relationships

You will need the support of your family and friends.

Make them aware of the effect starting up a business will have on your life, and how important it is that they are right behind you.

Aswell as their emotional backing, you may need practical 'hands on' support.

Talking through these issues before they arise will help.

Research has shown that there are certain qualities commonly found among successful business people.

A typical entrepreneur will have the following key qualities:

• Self-confidence
  A self-belief and passion about your product or service - your enthusiasm should win people over to your ideas.
• Self-determination
  A belief that the outcome of events is down to your own actions, rather than based on external factors or other people's actions.
• Being a self-starter
  The ability to take the initiative, work independently and to develop your ideas.
• Judgement 
  The ability to be open-minded when listening to other people's advice, while bearing in mind your objectives for the business.
• Commitment
  The willingness to make personal sacrifices through long hours and loss of leisure time.
• Perseverance
  The ability to continue despite setbacks, financial insecurity and exposure to risk.
• Initiative
  The ability to be resourceful and proactive, rather than adopting a passive 'wait and see' approach.

As a business owner, you need core skills to execute your ideas to make sure that your new business survives in the long term.

You should start by assessing your own skills and knowledge.

This will help you decide whether you need to learn new skills or draw on outside help by delegating, recruiting or outsourcing.

Key business skill areas

• Financial management
  This includes having a good grasp of cashflow planning, credit-management and maintaining good relationships with your bank and accountant.
• Product development
  The ability to make long-term plans for product development and identify the people, materials and processes required to achieve them. In order to make such plans you will need to know your competition and your customers' needs.
• People management
  This includes managing recruitment, resolving disputes, motivating staff and managing training. Good people management will help employees to work together as a well-functioning team.
• Business planning
  The ability to assess the strengths and weaknesses of your business and plan accordingly.
• Marketing skills
  A sound marketing approach will help you set up and oversee sales and marketing operations, analyse markets, identify selling points for your product and following these through to market.
• Supplier relationship management
  The ability to identify suppliers and positively manage your relationship with them.
• Sales skills
  Without sales your business cannot survive and grow. You need to be able to identify potential customers and their individual needs, explain your goods and services effectively to them and convert these potential customers into clients.

You need to research your target market and your competitors carefully.

A common misunderstanding is that business owners who have failed lacked enough funding or did not put the right team in place.

In many cases, new businesses fail because they have not spent enough time researching their business idea and its viability in the market.

There are certain criteria you can use to establish this.

Think about your market, whether you will serve South Tyneside or further afield, and maybe an online customer base, while considering:

• Does your product or service fulfil or create a market need?
• Can you identify potential customers?
• Will your product or service outlive any passing trends or capitalise on the trend before it dies away?
• Is your product or service unique, distinct or superior to your competitor's offer?
• What competition will your product or service face - locally, nationally and globally?
• Is the product safe?
• Does your product or service comply with relevant regulations and legislation?
• Can you sell the product or service at a price that will give you enough profit?

Market research can play an important role in answering many of these questions and increasing your chances of success.

Types of market research you can do

How much research you do will depend on the time and funds you have available. You could:

• Informally canvass the opinion of friends
• Talk to industry contacts and colleagues
• Survey the public about whether they would use your product or service
• Ask customers of competing products what improvements they would like to see
• Set up focus groups to test your product or service
• Monitor what your competitors are doing
• Look at what has and hasn't worked in your industry or market niche
• Study wider economic and demographic data

The more information you have, the better placed you will be to make your business idea a success.

Securing the right financing for your new business is crucial, as there is no guarantee that your business will make money for you straight away.

You should aim to have sufficient reserves to last you for several months without an income from your business.

You need to be honest about your start-up capital reserves.

If there is not enough money to see you through until your business begins to make money, then you are not ready to start up.

Being realistic at this stage is likely to save a lot of pain.

If you decide to launch your new business without enough funding behind it, keeping it afloat will prove extremely difficult.

There are many different sources of potential start-up funding, including bank loans, overdrafts and private loans.

For more information, see choose the right finance when starting up.

For expert help, contact an accountant, small business adviser or your bank manager.

Starting up a business requires a considerable investment of time, funds and energy.

Before you begin, you need to honestly assess whether you really have what it takes and how well you think you might handle the risks involved.

You may want to consider the following questions:

• Are you prepared for the personal demands of setting up a new business?
• How well do you handle uncertainty?
• Do you have a positive attitude?
• Are you prepared to take chances and gamble on your ideas?
• Do you have any of the key qualities of a typical entrepreneur?
• Do you have an absolute determination to succeed?
• Can you bounce back from setbacks?
• Are you able to delegate?
• Do you have core business skills?
• Are you prepared to spend time carrying out in-depth market research?
• Do you have sufficient funds to set up a new business?
• Are you willing to draw on expert help when you need it?

Very few entrepreneurs can claim to be strong in all of the areas required.

The key is to make the most of your assets and take action to address any gaps.

This could include:

• learning new skills yourself or,
• drawing on outside help by delegating, recruiting or outsourcing

Ultimately, you are the only person who can decide whether you have what it takes to make your dream of starting a business into a reality.