Action Checklist for the Prospective Entrepreneur

Assessing Personal Suitability

  • Have you objectively rated your personal strengths, weaknesses and knowledge?
  • Are you ready to face the uncertainty and irregularity of income during the early years of your business?

Feasibility analysis

  • Is there a need and market for the product or service?
  • Are general business conditions conducive?
  • Do you have sufficient information on competition and markets?

Financial Analysis

  • What is the typical return-on-investment of your business? Is it greater than if the money were invested elsewhere?
  • Have you a complete list of capital needed for start-up, including equipment, supplies and inventory?
  • Have you pro forma financial statements, including cash flow, for at least three years?
  • Have you discussed your plans with your banker and accountant? Are their attitudes supportive?

Insurance

  • Have you investigated insurance coverage for accidents, fire liability, judgments, or loss of a key employee?

Organizational Form

  • Do you know the pros and cons of partnerships, corporations, etc.?

Location

  • Have you checked the makeup of the population, and the number and type of competitors in the area?
  • Can the area support a business like the one you propose?
  • Have you investigated the utilities, parking, police and fire protection, room for expansion?

Alternatives to a New Business

  • Have you compared the cost of equipping and stocking a new business with the cost of buying a going business?
  • Have you considered the advantages and disadvantages of franchising?

Purchasing, Pricing

  • Have you calculated initial inventory and worked out stock control plans?
  • Have you found dependable suppliers with reasonable prices?
  • Are you familiar with your competitors’ prices?
  • Have you determined your own price ranges? Costing details?  Legal aspects of your price policy?

Advertising, Selling

  • Have you determined your selling and promotion methods?
  • Do you have a marketing plan?

Personnel

  • Do you know your personnel needs and prevailing wage scales?
  • Do you have a plan for employee training and motivation?
  • Are you informed about required employer obligations to employees?

Government Requirements

  • Have you checked the permits and licenses required?
  • Are there health, safety or interstate commerce regulations that apply to your business?

Record Keeping

  • Has a system been set up?
  • Do you know what financial statements you will require and how to use these statements?

Goal Setting

  • Have you set realistic goals and dates for them?
  • Have you made plans to keep up with improvements in your trade?