If you’ve been dreaming about starting your own business in the hospitality industry, you might be wondering when to take the first step. The best way to test your idea and increase your chances of success is to ask these five important questions below.
Why do you want to do this?
You may love your idea right now, but what’s going to get you through the long nights, seven-day weeks and mountains of paperwork in the future? Your motivation is the key driver of success, so try to be really clear about what you want long term. Maybe you’re deeply passionate about your product, or desperate to branch out and be your own boss. Whatever the reason – find it, write it down and stick it on the wall. Knowing your true purpose will help the business move forward.
Is your idea different?
In a sea of cafes, how will you set yours apart? Why will people choose your restaurant over the five other eateries down the road? If you can’t define your unique selling proposition (USP) just yet, you might need to go back to the drawing board. It will take some soul-searching, but it’s worth it. Analyse the competition and see what they're offering customers, then look for gaps in the market and where your business might be able to add value. If you can solve a specific customer need, you’re on your way to uncovering your USP.
How will you pay for it?
Many businesses underestimate how much they’ll have to spend before they even open their doors. These are called startup expenses, and they’re the costs you incur before you begin turning a profit. Have a think about what the necessary purchases would be to get started. Take everything into consideration, from leases and catering equipment to marketing and domain names (these startup cost templates are useful). Once you know how much you need, research and compare the funding options that will work best for your business.
Who is doing this with you?
Whether you’re running a tiny takeaway shop or a large fine-dining establishment, you’re going to need people on your team – and not just for the day-to-day running of the business. For instance, you might have to bring in consultants to help with your finances or marketing. Or you may require extra support if the business goes through unexpected periods of growth. Don’t only think about the partners and employees you'll need to get your venture started – consider the long game, and what your team might look like a few years from now.
Can you handle the setbacks?
It's estimated that anywhere from three-quarters to 90 per cent of startups fail, so it's fair to say that success is often the exception rather than the rule. Disappointment and setbacks are a reality in the early days, but how you deal with them will set you apart. Use this early planning stage to read up on successful entrepreneurs and learn about the personal attributes that helped them build their business. Maybe you could consider getting a mentor to guide you through the inevitable bumpy patches. One thing's for sure – if you can tolerate uncertainty, stay open-minded and have a strong sense of resilience, you already have all the makings of a great entrepreneur.
Starting a new business requires passion and perseverance, but all the hard work is worth it when you finally open those doors for the first time.