Advice needed on setting up first business

L31mr0d

Ok i finished up an honours degree in computer engineering a few months ago and the drudgery of technician work is getting to me. I'm thinking about setting up some sort of computer hardware online retailer for ireland (like this company "hitide"). I know the market seems to be bloated with these online shops at the moment, but I have aspirations to set up outlets as well as being online, if the revenue is there.

So i'm looking for advice on where to begin, i've checked out basis.ie which has a lot of information. I just have a few questions:

1. Is there any short (6 week?) business courses I could take as I have zero acumen in this area
2. How do I begin to work out how much capital I will need before starting a venture like this
3. Is there any free sources that I can talk to to get advice and find out about common pitfalls.
4. Where can I source wholesale retailers? This is a big one as I can't find any information on it. Where do the likes of elara, komplett, hitide, OCuk... etc get their wholesale stock from?

Any help is much appreciated as I have all the gusto in the world to get this on its feet, just none of the experience at the moment

cormie

Hi, you should ring up your local county enterprise board (go to basis, bottom right you'll find a search thingy, search for enterprise boards in your county) and they should be able to advise you. They also run business courses (which are about 6 weeks long) for somewhere under €200!

PRman

Sounds like your living in a dream world to be honest - It's a different ball game out in the real world. If you really are serious get a job in a similar line of business and learn as much as you can about the running of the business and take it from there...

L31mr0d

PRman wrote:

Sounds like your living in a dream world to be honest - It's a different ball game out in the real world. If you really are serious get a job in a similar line of business and learn as much as you can about the running of the business and take it from there...

"dream world", "ball game", "real world"... who speaks like that? Sounds like buzzwords people like to throw at you to convince you of something they don't really believe. Name the amount of entrepreneurs you know, that sat in classrooms getting educated, and working under people who actually took a chance, BEFORE starting their own business.Anyway I AM working in the area I want to go into, I have all the acumen in the world for electronics and computers, what the trends are and where this sector is moving, I just need the business know how to implement a way of taking advantage of it.

So thank you Cormie, i'm going to follow your advice asap. Is there any other members here who own their own business that can provide any tips as to how they got their footing when they first started out.

ThomasH

Hi L31mr0d

Cormie gave some good advice and there is only one thing I agree with PRman on this:

If you really are serious get a job in a similar line of business and learn as much as you can about the running of the business and take it from there...[/

However, if you are as stubborn as me and don't want to work for someone before starting your own business then start with a business plan and get the basics right - Budget, marketing, business idea, etc. and take it from there

Good luck!

L31mr0d

ThomasH wrote:

Hi L31mr0d

Cormie gave some good advice and there is only one thing I agree with PRman on this:


However, if you are as stubborn as me and don't want to work for someone before starting your own business then start with a business plan and get the basics right - Budget, marketing, business idea, etc. and take it from there

Good luck!

I'm probably going to go ahead and take a 6 week business course just to get the basics, in the mean time i'm going to see if I can get somebody else on board, I tend to come up with ideas better when I bounce them off someone like minded.

Do you have any idea where I would go about finding out who the other businesses in the same area use as their suppliers?

Millionaire

I am running my own business since 2000 and started when I was 27 or 28.

Here is some simple advice...read as many books as possible on starting up your own business! there is tons of them.

You will have to work out cash flow projections, someone handy with accounts can help you with this.

I had 2 years experience in the sector I set up in working for someone else, and I was one of their top performers, so I know I could do it alone. but I had 5 years sales experience in total.

Be prepared for levels of stress like never before. I lost stone weight, did not sleep proper for the first few months, as I was scared, as I put every penny I had on the line. Thank God the 1st 2 years was a roaring success.

I worked 12 hours a day in the business in office at 730am to 730pm for 1st year, and when home...took a hour or so break, and then worked rest of night planning. 2nd year I worked 8am to 730pm. also worked weekends. and 24/7 was working in my head!

However the recession in 2001 onwards was some kicking to get. that was very hard and lasted 3 years for me.
But thats business, thats how you get experience!

L31mr0d

*phew* i'm glad to see you said you started when you where 27-28. I'm 24 atm and was always under the impression if I hadn't already got some ball rolling by the time I hit 21 I couldn't seriously set up a strong business.

Firstly I have to thank you for your sig, I was meaning to get some of Tony Robbins audio books but had forgotten about them. I'm going to look on Amazon tonight for some books on setting up my own business. Can you recommend any that have helped you?

cormie

You're also going to have to ask yourself, what exactly do you want from the business? Do you want to grow into a business tycoon or do you just want enough to pay your way every week, will you rely on it in the future to support a family, children, pay for schools, colleges and all that. Are you prepared to work at it 40-50 hours a week, are you materialistic and desire the big cars big houses or are you happy to just have the basics.

More aspirations generally leads to more stress and less time for the finer things in life so don't get too carried away.

I just registered a new business today as well as poker.ie. The 2nd of many to come I think. It's good to keep your options open and don't get too bogged down in one thing if you want to explore other areas.

L31mr0d

I get where you're coming from, i've read the parable of the fisherman. The thing is its becoming an addiction, i'll buy something online even if I know when I sell it on i'll end up making only €10. I want an outlet where I can start turning this addiction of buying hardware cheap and selling it on for a profit into a working business. Dealing with legitimate wholesellers and selling through an online store or from outlets. My end goal is to be in a position to take advantage of shifts in the market as they happen, instead of just watching others. I love being right in the thick of the latest computer hardware and to have a job right at the forefront of it would be perfect. For now i want to sell/review/test hardware, and if thats successful maybe even go as far as setting up my own electronic engineering company also, doing R&D.

I have so many ideas floating around in my head that its causing me to lose sleep as it is with every day I waste thinking about it. So if running a business does the same thing there will be no real change. Even if my ideas fail, at least i'll know, rather than having this big "what if?" hanging over my head like the Sword of Damocles.

antoinolachtnai

So what is your edge?

Computer retailing is not really about being at the edge, other than for very specialised suppliers. The Irish market is small to do anything too specialized.

If you want to get into retail, you really should get a job in some sort of logistics, operations or marketing company for a while though, to figure out what it's all about.

If you really want to get into engineering, why don't you focus on that?

TempestSabre

FAS do a starting/running a business course. Why not try that.

stepbar

In other words what differentiates you from the rest? Cost / Range of Services / Products etc etc

I'm not being smart but when I hear online hardware store / highstreet outlet and own electronic engineering company in the same paragraph I'm beginning to wonder what is it that you REALLY want to do? My advise to you would be to get your thoughts down i.e put it on a business plan and stick with it. Approach a few banks for funding and you will know what your plans are like fairly quickly. It could take many revisions and modifications to get it right. I'd advise you also to start making and sourcing contacts (like other startup businesses you could sell computers to). You will need to know what your customers needs are and work from there. Market research is KEY. There is no point going off an opening an online store and not knowing who or what your market is. When you have the finances available you can start building relations with them.

TempestSabre

Obviously there are always new business's that come from nowhere and manage to break into a saturated market and are successful. So there's always that chance. So I'm not knocking that.

But the logic behind doing a honours degree in computer engineering then turning around and doing something completely different baffles me. Also the computer hardware market is a difficult way to make money. There's a lot fewer of them now than there used to be, and the ones that are around now generally make their main money from corporate accounts, and support and maintenance work from companies. But even then theres not huge profits in, which is why most of them provide other services, and professional services, like software development or selling and supporting specialised software. OcUK for example apparently do a lot of corporate work. Someone posted details of their accounts online before and they weren't all that great.

I know 2 or 3 people who used to sell hardware, one who had 30-40 people working for them and they've all got out of the business and moved into other things, mainly software.

Millionaire

I basic read any book I could get my hands on from about the age of 22, about how to Start your Own Business. some were boring as hell, talking about Accounting and stuff...but I read them anyway.

read books on sales and selling.

Brain Tracy got some good stuff... his book Maximun Achievement was really good. Think and Grow Rich..by N Hill is a famous classic.

Re Tony Robbins Get the Edge is good.

If you doing internet business, the Internet Marketing Centre got a good program to teach you how.

I got a few more internet biz planned infro 2007, their going to be small but 90% automated..so the money rolls in.

cormie

so are you actually a millionaire;) ?

Millionaire

No! LOL! almost got there once, and lost every penny, on business mistakes.

I did grow my business from 0 and a dirty office, to over 1.3 million in sales in my first year....not bad for a 28 year old back in 2000. Though I worked liked a mad man that year.

Maybe that means I got a million euro worth of business lessons with mistakes I made afterwards.

Had to start from zero again. In fact most success business people in the USA have either gone bang, or been very close to it, on average of 6 times, beofore they finally got it right, or got the right business idea.

Anyway Success is a Journey and all that.

Roman was n't build in a day, and the steady drop will always fill the bucket!

cormie

Yeah that would be a big learning experience for sure:o

If I ever become a multi-millionaire, I wont complain, but I'm not going to dedicate my whole life to it (money).:cool:

PRman

Well you sound like you have the hunger which is a good start. I've seen people come out of college with their heads in the clouds, hence my initial scepticism. You have come on here for advice so I suggest you don't be so defensive when people try to be constructive. Anyway I would suggest you place a lot of emphasis on developing your selling skills because every enterpreneur needs to be a top salesman. You will need to sell yourself as well as your product every step of the way (especially to get venture capital) Also be prepared to work 60+ hours per week....

Millionaire

Yes, PRman is right about learning to be a top sales person.

Not only do you have to sell your business/product/service but you have to sell in many other ways....

for example... you will have to sell to your bank to maybe give you an Overdraft facility, or a lease for equipment.

If you hire staff, you will really did to be an excellent sales person, to sell them as to why they should gamble with working for a small new start up.

I have read many sales books, been on many sales courses, and sales audio too, and the very best I have come across, and I find really works well for me
is www.unlockthegame.com

Many sales books/programs were developed in the early 80s... pressure selling, manipulative sales tricks.... these days business people can see/smell this sort of stuff a mile away, and they do not appreciate it either!

Plus these days its quite difficult to get people Live on the phone to even sell them, re voicemail, people using email etc etc, so you need to work in a different way to get attention, and be sincere.

edanto

Sounds like you've got buckets of enthusiasm, great start.

Have you sat down and written a plan yet?

When writing the plan, you'll need to be brutally honest with yourself, look at the range of skills that you have and compare that with the skill set that a successful business needs. That will help you identify the areas that you need advice/partners in. You can't do everything, but it's tempting to kill yourself trying.

There's no shortage of good ideas - they're not the limiting factor in a new business; the hurdle is making sure that every skill area is covered by a combination of what you can do and things that you can ask people to do. Be they partners or contractors or whatever.

Good luck and fair play to ya.

L31mr0d

antoinolachtnai wrote:

So what is your edge?

Its right here in my left nostril, the one i'm tapping right now

There are a lot of areas of the market for computer hardware, building and enthusiasts which aren't even being remotely covered by present hardware suppliers. I'm hoping that I could set up a business that would fill those gaps and also offer the standard hardware choices so that people buying in ireland wouldn't have to order from multiple sites and pay multiple shipping costs to order in parts from abroad.

It WON'T be impossible to cater to EVERYBODIES needs. But i'm hoping to start small, maybe specialize in an area which isn't being catered for, then work up from there. But like was pointed out, atm this isn't more than an idea on the back of a beer mat. I just want to start getting the wheels in motion now before I lose the gusto and confidence to go through with it.

stepbar wrote:

I'm not being smart but when I hear online hardware store / highstreet outlet and own electronic engineering company in the same paragraph I'm beginning to wonder what is it that you REALLY want to do?

I've been asking myself this same question since I was handed my CAO form 6 years ago. I've always been good at pretty much everything i've put my hand to, but never great at anything as I never had the enthusiasm to give it my all. I've always been of the mind to set up my own business but couldn't figure out in what area. My college training hasn't been a complete waste as I have a strong understanding of electronics and computers and for what new developments are going to make a huge impact on the market.

As for sales, I believe enthusiasm is contagious. I once went to a seminar at Xilinx in citywest, and the first speaker was Irish and even though his tone and pace aimed at getting you excited at their new products, he just didn't seem enthusiastic about it to the point where I believed him. Now the 2nd speaker was American, and imo they must have perfected the art of sales in the US, because at the end of his speech he had whipped up the whole room into applauding the product he was introducing which had nearly identical features to the first, the difference was that you could feel the enthusiasm from his voice and in the glare in his eyes. I believe if I can get into a business which I myself am enthusiastic about, my employees will see this and have it rub off on them... but thats not to say I won't be looking for some sales training also

Millionaire

I think you mentionde in OP, you were going to start on the Web?

In that case, would you not start part-time, work a 9-5 in order to have money rolling in, and also get some sales experience. and then in the evenings and weekends, work on your business... that way you can build up slow but surely, test out the market, and see can you make money, and also keep costs down, so you have more money for advertising.

See sometimes it takes a while for the money to start rolling. Before I started my own business, I worked for a company in the same sector and became their top performer and earn out of over 300 people across europe. so I knew my sector, but more important I was making big money, and I saved and saved in order to have the cash to bank roll going it alone.

If you want to start full time, you are going to need money, and probably more that you budget for.

I self financed myself to start, though I did get a 20K lease from a bank, to buy a computer network. Now it took some persuasion (sales skills) to get the bank to hand that out to a young guy start out.

Also it was nearly 5 months before the cash started coming in. Thats along time to wait!

L31mr0d

Millionaire wrote:

I think you mentionde in OP, you were going to start on the Web?

In that case, would you not start part-time, work a 9-5 in order to have money rolling in, and also get some sales experience. and then in the evenings and weekends, work on your business... that way you can build up slow but surely, test out the market, and see can you make money, and also keep costs down, so you have more money for advertising.

Good advice! I don't plan to just quit and take a leap of faith. I understand the benefits of working off the shoulders of others. I'll probably move out of my present job at the first chance and get into an area closer to where I want my business to go. What you said is exactly how I plan to go about starting this up. Have a full time job, but in my free time work on getting suppliers and setting up a good e-tailer website. I also have training in software engineering so i'm going to have a go at designing a website myself to start with then get opinions on it, although any basket or payment options will have to be third party.

Here is a question though, my friends father owns a a fairly successfull online e-tailer of computer hardware and peripherals in Ireland. I am between 2 minds whether I should ask him for advice on how he set out and who is suppliers are. I would feel obliged to tell him that I also intend to get into this area? He would seem to be an excellent source of information but also my business would probably be in direct competition with his eventually. Should I just look else where for advice?

Ancient1

L31mr0d wrote:

Have a full time job, but in my free time work on getting suppliers and setting up a good e-tailer website.

I wouldn't advise setting up a LTD company straight away though. If you're working full-time as a PAYE employee and are trying to set up shop and test the waters on the side, I'd register as a sole trader to start with - and move the whole operation to LTD when the time is right.

L31mr0d wrote:

I would feel obliged to tell him that I also intend to get into this area? He would seem to be an excellent source of information but also my business would probably be in direct competition with his eventually. Should I just look else where for advice?

Good inside information is hard to come by. You have a good source right there - I say go for it.

is_that_so

Bank leasing can be very advantageous. There are also loans for smaller businesses. All of which will involve a detailed business plan. Do lots and lots of market research. The only observation I would make on the business idea - IT hardware is that you will probably need substantial capital outlay to get it going. The margin on hardware tends to be extremely low and to be successful you are talking about large volumes. This in turn suggests access to a lot of stock which in turn requires a lot of capital tied up.

I've been out on my own for a couple of years and my story is the opposite of Millionaire. Quite a struggle but rewarding and I am learning as I go along. I am also finding that the original plans I had have changed in ways that I never expected . But I am getting there. In general businesses tend to take 2-3 years to get going.

ThomasH

Here is a question though, my friends father owns a a fairly successfull online e-tailer of computer hardware and peripherals in Ireland. I am between 2 minds whether I should ask him for advice on how he set out and who is suppliers are. I would feel obliged to tell him that I also intend to get into this area? He would seem to be an excellent source of information but also my business would probably be in direct competition with his eventually. Should I just look else where for advice?

Heck, I'd say go for it. This is a good source and don't feel bad about asking him. He might be helpful or tell you to go play with your toys but if he does help you it's already a big step. Business is business and he says no then don't take it personal.

Millionaire

is_that_so wrote:

In general businesses tend to take 2-3 years to get going.

Yes, your right...we took off too fast...boom times before recession in 2001. I worked so hard to make it a succees, but the economy was real good.

I started to think I was Richard Branson, and everything I touched turned to gold, which lead to some very very bad mistakes, which lost fortunes, and took years right.

A slow steady pace is much better, way of learning.

cormie

Millionaire, in what way would have going slower helped you not to lose the money do you mind me asking?

You had the money to lose instead of losing the same amount of money by the same mistakes if you had of gone slower and not earned as much, meaning you could have been in substantial debt?

Millionaire

I hate to say it like this Cormie, but I am being brutally honest with myself, (you have to be to learn), when you make alot of money very fast, you first time out as a young green business guy, you might refer to it as "loosing the head abit"

I mean I worked every waking hour that year pretty much. even if I was not in office on sunday, I was thinking planning and plotting stuff. or reading motivational stuff etc...

Basically, looking back, I think (and my business partner too) that we both thought we were invincible in business. thats when mistakes were made with money, both in business and outside the core business. and also partnershipping cracked, and we split business as we both had massive egos then! :-(

I just think if it had been a slower steady growth, and success did not come as fast, we would have handled it better, in all ways.

maybe compare it to the kid who wants to be a pop star standing on the street corner , and 6 months later they are Number 1 on top of the pops with a few hits. they all end up fecking it up....if you see my point?

antoinolachtnai

Even if you aren't being a headstrong wally (been there, done that) it is very hard to know whether you are really building a profitable business when the turnover is growing so rapidly. The growth masks all the inefficiency and waste. Even if you are growing efficiently, you need a lot of cash to support it.