Entrepreneurship: no easy business
Running your own business may seem like a dream job, but there may be more to it than most people realize: employer identification numbers, licensing, taxes and marketing.
At the Small Business Development Center, about 20 percent of its clients are students, but only a few each year start a business because there are so many requirements, said Brandon Birch, a management consultant for the center.
“I think a lot of people want to start a business because it seems like the cool thing to do – an easy ride,” he said. “It seems nice because they don’t have a boss and they can make their own schedules. But it is a lot of work and a lot of risk. It’s not very often that the students who come in actually go through the process and start a business.”
The Center gives free advice to about 270 people per year, said Frank Prante, the center’s director. He said there is a low success rate for new small businesses, but owners with experience do much better than those without.
“Experience is very important,” he said. “I would suggest to anyone wanting to start a business to work in that field first. There is a high failure rate among start-up businesses, but for someone who has five years or more experience, there is a 96-percent success rate.”
The first step in starting a business is making a business plan, Prante said. A business plan looks at several aspects of the business idea to see if it would be successful. Different aspects include how much money is desired, the management and personal requirements, the goals of the business, the financial aspect and the marketing requirements, he said.
“It gives a very good overview of their business – where they’re strong and where they’re weak,” Prante said. “They should initially look at a business idea and write it out and address the feasibility of reaching the appropriate level of sales.”
Possibly the most important thing to do when starting a business is to figure out how much money it needs to make to be successful, Birch said.
“One of the best services we offer people is to help them know how much they need to make to have a business be successful,” he said.
If a student has a feasible business plan, Birch said he would recommend they start a business.
“If they can start a business where they can get direct experience with their field and minimize their risk, then I recommend it,” he said. “It’s a good experience, and it looks good on a resume.”
The services the center provides include financing, business plans, marketing, analyzing financial statements and promotion; they do not help with creating a legal structure or with taxes, Prante said.
“Anybody who’s thinking about starting their own business should come talk to us. We can see if it’s a feasible opportunity for them,” Birch said.
Another thing would-be business owners should consider is joining the Cache Chamber of Commerce, said Tiffani Rudd, the membership director of the chamber.
The organization provides discounts on health care, cell phones and the Sports Academy. It also provides free business counseling for entrepreneurs. There are also networking opportunities and monthly luncheons and workshops, and the chamber also does advertising for its members, she said.
“Every year we put out the Cache Valley Guide and distribute 30,000 of them to people who request information on the area. In the back is a list of all chamber members. Chamber members also get listed on our Web site,” Rudd said.
When the chamber gets calls from tourists or people from outside Logan, the callers are referred to chamber members.
“Right after school started, a mother called me because she wanted to send her daughter flowers. She asked me if I knew of a place, and I referred her to a flower shop that was a chamber member,” Rudd said.
She said word-of-mouth advertising makes or breaks a business. The cost to join the chamber depends on the number of full-time employees a business has.
“If businesses want to make the effort to become members and become an active part of the community, we would consider them to be good chamber members,” Rudd said.
For more information about the Cache Chamber of Commerce, call 752-2161 ext. 103, visit its office at 160 N. Main St. or apply online at www.cachechamber.com. To contact the Small Business Development Center, stop by or call 797-2277. It is located at 1330 E. 700 North, Room 124.