Small biz start-ups: Basic guidelines to achieve success | Sunday Observer

Small biz start-ups: Basic guidelines to achieve success

21 November, 2021

The inspiring British business magnate, author, and philanthropist Sir Richard Branson once said, “A business is simply an idea to make other people’s lives better”. While the sentiment is graciously humane, by being an entrepreneur, an individual can also find great personal satisfaction in life as his or her own boss.

It is said that as long as one works for someone else, no matter what the rank is, he or she is duty-bound to obey and follow the rules laid by another person.

Therefore, working on your own is a tremendously lucrative option any person possesses.   

Thinking or deciding to start a business may seem a daunting task. Nevertheless, if one looks at millions of successful micro, small, and medium-sized businesses, one may find that learning how to start a business venture is easier than it seems if the correct path is followed.

When you decide to start your own business and if you have already identified what you plan to offer to the market, a sizeable part of the initial preparation is over.

However, assessing whether you are truly ready for self-employment as your vocation is vital. If you are confident of your skills and if you know that a market exists for the products or services to be offered to the customers, you can start looking towards the process of starting the business.

First and foremost, you need to make sure you are prepared thoroughly before starting the business. At the beginning itself, you must realize that things can go awry in a blink of an eyelid if your evaluations, assessments, risk analysis, market situations, and some other factors are not known in detail.  

If you are convinced and confident that you are ready to roll, the first and the most important step is to create a simple business plan.

The business plan can be short but it must be precise by way of information. Also, the plan can be a few typed pages and can be without complicated formulas, that can be understood by the other stakeholders of the business.


To craft a business plan, you need to conduct simple market research on the intended business, demographics, potential customers, and the impending competition.

The research provides the key ingredients to compile the business plan. However, depending on the nature of the start-up, the research can be either geographical or national, yet it can be a simple collection of primary and secondary data. 

A business plan with the proper information can be the guidebook of the new business and it will be incredibly useful down the road. It also allows researching and understanding the target customer segments.

Another enormously important criterion is that the business plan helps the business to set revenue goals at the very beginning. Also, if the entrepreneur can make a visible difference in the planned products from the customer perspective, a significant impact can be created on the competitive landscape that can convey a unique value.

Customers provide revenue for the survival and growth of a business. The core of a business plan is to determine how the company can attract customers. Hence, as an important element of the business plan, developing a simple marketing plan is a must. Particularly, the marketing plan gives insight into essential information such as the real-time market conditions, the current opportunities available, competitive information, and all other market-related issues.

The marketing plan also provides other vital statistics and details such as customer segments, marketing, and sales strategies, pre-defined objectives, revenue forecasts, sales forecasts, and other financial necessities. More importantly, the marketing plan directs the business towards the potential customers by recommending ways to communicate with the customers. The communication strategies outlined in the marketing plan give clear instructions on how to advertise and promote the business. 

Regardless of the size or capacity of the new venture, you need funding. Hence, once the business plan is in place, the entrepreneur has to consider funding options, unless funds are available on your own. However, even if the entrepreneur has adequate funds, time and again they tend to go for outside sources for financial inputs.

Raising funds

There are several methods for entrepreneurs to raise funds. A commercial loan facility from a bank can be a good starting point. However, in Sri Lanka, securing a bank loan can be a difficult task unless the entrepreneur has adequate collateral. The SME loan facilities offered by the banks are the best option in Sri Lanka although securing such loans can be tedious.

Inviting investors is perhaps the second-best option to raise capital for a new business although positive and negative factors exist in this method. The advantages are that you can raise a larger amount of funds, no collateral requirements, no repayment interests, more knowledge sharing by way of investor participation, and so forth. Also, investor involvement reduces operational risks where a loss can be shared proportionately.

On the other hand, there are significantly tall negative factors that also exist in bringing in investors.

The main among them is that the business is your brainchild and you have set goals both financial and otherwise based on your own imagination. The investors may want to invest in your business, not your business dreams. Hence, perhaps, you may find contradictory visions from the investors. Two other factors in inviting investors are the limitation you may experience in the business-related decision-making aspect and your freedom to change as you feel or need in the operation. Particularly, an investor may want to get involved in even minor details such as the company logo or office arrangements, where disagreements and misunderstandings can occur.

 Animosities can be possible with investors at any stage of the operation that can inflict troublesome constraints in the business you have planned by yourself at the beginning. The investor may object to making changes as you wish even though the business is yours.  Hence, a clear-cut documented consensual agreement is a dire requirement when investors are brought in for a start-up.


The new entrepreneur has to be deeply conscious of the expenditure factor at the start of the new venture. In the context of expenditure, every aspect of the business has to be carefully and meticulously planned in the first phase of the business.

Costs related to production, marketing, procurements, new machinery or equipment, recruitments, or admin expenses must be kept at the bare minimum until the business is properly up and running. The luxuries can come once the business is established.

In between the important stages discussed above, you can concentrate on several other vital aspects. Deciding the legal status for the business must be done carefully whether it is a sole proprietorship, partnership, or limited liability. The best is to seek professional advice to determine the most appropriate status for the business.

Hiring employees is also a strenuous task at the beginning of a small-scale business. Not only do you have to keep the numbers at the minimum but you must also make sure that the employees you hire remain with you for at least a reasonable period. Wrong recruitment can be costly to a new business.

Outsourcing resources, rather than directly recruiting, at the initial stage can be cost effective.  

Finally, with my long experience in business as an administrator and a coach, I can safely recommend that every newcomer have at least one experienced professional as an adviser.

Most often, such professionals known to you will provide basic advice free of charge for your start-up. As a new entrant to business, the opinions of suitably experienced advisers will be extremely useful to go through the first phase.