by Tim Rosanelli

Created on: February 22, 2008

"Are you Crazy!?" are the exact words that came from my wife's mouth when I told her that I wrote a business plan to start a Martial Arts School. She was reacting to me telling her that we would require about $50,000 for start up costs and the first few months of operating costs. Back to the drawing board, I went. I tweaked my plan so that we were able to start on less than a $1000. In less than 4 years, our business grew to a six figures income.

In those first three years of operation, I learned many important lessons that drove our business to success. Here's some tips to setting up your small business.

Eight Tips to Setting up your Small Business

1. Start small first - . Most people dream of that cushy retail spot with plenty of space that will bring in many walk-by customers. Beware a prime retail spot comes with a huge price tag, think small at first. Ask yourself, "What is the quickest way to make money?" For example, my original plan calculated the cost for a prime retail spot. Instead, I found an alternate location at a church auditorium. This decision suddenly made starting a martial arts school affordable because the monthly rent was ten times less than a retail spot.

Starting small had many advantages, too - It provided us time to build better systems, find a niche, grow our customer base, and create an income stream to reinvest in the business without the risk. Yes, after a year, we got that retail spot but only after our idea proved itself and we earned enough capital to move without worries.

2. Create a detail plan Most people ignore creating a detail plan in favor of just starting the business. A detail plan will help you identify a niche and determine how you will get customers in your door. Ask, "How is my business different then the competition?" and "What methods will I use to get customer in the doors?"

Your plan should detail your break-even point. The break-even point is the amount of money required to stay in business. Brainstorm on how you will meet this break-even amount.

3. Get professional advice - Before you open your door for business, seek the advice from a qualified accountant and lawyer. Your accountant and lawyer will become important members of your team to help you reach your business goals, assess risk, and hold you accountable.

4. Find a niche - You definitely do not want as Dan Kennedy says, "to roll around in the mud with Wal-Mart competing for the lowest price" This is a losing strategy for any business instead look for a niche

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