Even though the financial crises are slowly loosening its grip on the business arena, small business owners and entrepreneurs are still reluctant to initiate their businesses. Setting up a business is relatively more difficult that running it. According to the latest Statistics released by US Small Business Association (SBA), there are 49% chances of a small business failing within 5 years. This shows the appalling success ratio of establishing a business these days.

But, failure can be avoided if preventive measures are taken beforehand. One of the common reasons of small business failure is the lack of planning and forecasting. Following are 5 common questions that haunt a small business in its initial stages and hence must be addressed ahead of time.

1. What Are My Financial Perimeters?

The first question to answer before establishing a small business is regarding your financial perimeter. You must establish your business scope and scale according to your financial stretch. Most small businesses fail because their liabilities outweigh their assets. Moreover, some entrepreneurs tend to be over-ambitious and diversify their business more than their available resources. This leads to under-utilization of resources and your business falters.

2. Do I have the Right Corporate Logo?

The next critical thing that determines a stable business is your corporate identity and image. Corporate logos are the cornerstone of every small business brand identity. They help the customers in memorizing and recalling your brand/product when required. Without giving due consideration to your identity development, you cannot run a successful business venture.

3. Who are Your Targeted Customers?

Another common small business owner’s mistake is not defining their target market beforehand. In a rush, they fail to correctly identify and recognize who they would like to cater through their business offerings. For a small business, a well defined target market is suitable to gain reasonable and stable profits.

4. What is my Unique Selling Proposition (USP)?

According to the SBA Statistics of 2011, there are over 27 million Small Businesses in the US alone. In order for a new entrepreneur to make his mark in the business arena, uniqueness and distinction is required. Hence, another question that small business owners must ask themselves is what their Unique Selling Proposition (USP) is. This refers to the one competitive advantage that makes them stand out from the crowd. By defining your USP, you can make an impact in the market.

5. Do I have the Right Marketing Tools?

In this congested world of media and gimmicks, marketing is something that is hard to overlook. Before establishing your small business, you need to be aware of the marketing tools like business cards, flyers and corporate brochures that will propel your business in the market and help you advertise your business to the target audience. Without adequate exposure of your business, nobody will recognize your presence in the market.