Canada’s entrepreneurs offer words of wisdom to aspiring small business owners - RBC survey

Canada’s existing entrepreneurs have some well-earned words of wisdom to offer the 3.3 million aspiring entrepreneurs across the country who are planning to start a business within the next five years, according to the annual RBC Small Business Survey.

“The key piece of advice from Canada’s veteran entrepreneurs is ’do your homework’ before you open up your new business,” said Rina Pillitteri, director, Small Business Client Strategy for RBC. “When successful small business owners look back on what helped them get off the ground, it’s the fact that they knew what they were facing - they researched who their competition was, they understood what gaps they could fill in the marketplace, and they delved into the likes and dislikes of their potential customers. They also networked to find out as much as they could from other entrepreneurs.”

The top ten pieces of advice existing entrepreneurs have for people hoping to start up a business, according to RBC’s survey:

1. Know your competition (51 per cent)
2. Develop a business plan (50 per cent)
3. Research the market (49 per cent)
4. Network, develop alliances (45 per cent)
5. Take time for marketing (38 per cent)
6. Seek out mentors (35 per cent)
7. Spend time defining the needs your business will meet (35 per cent)
8. Survey potential customers (34 per cent)
9. Do homework about where to locate your business (34 per cent)
10. Join clubs/associations (32 per cent)

“Aspiring entrepreneurs can uncover amazing tips and insights by talking to current business owners before getting swept up in the fast pace and excitement of starting up,” added Pillitteri. “Also, seeking out a mentor can help you save time as well as money, and the advice they offer could mean the difference between success and failure.”

The RBC survey, which compared the responses of aspiring entrepreneurs with those of existing entrepreneurs, suggests Canada’s emerging entrepreneurs may not need to be as focussed on obtaining financing as they think they need to be. In fact, while half (51 per cent) of Canada’s aspiring entrepreneurs expect that one of their biggest challenges will be getting enough money to start their business, only one in five current entrepreneurs recalls getting initial financing as a challenge. For existing business owners, the biggest start-up challenges were finding clients or developing their market (48 per cent), keeping a steady workload (31 per cent), working long hours (28 per cent), and dealing with government bureaucracy and regulations (21 per cent).

RBC’s 2007 Small Business Survey also reports a majority (61 per cent) of Canada’s small business owners appear to be satisfied with the way they started their businesses - if they had it all to do over again, they would not change a thing. Of the 39 per cent who said they would do things differently, 61 per cent would start at a younger age and 58 per cent would get more financial advice.

“Whether or not it’s a new entrepreneur or a veteran, every small business owner is bound to face a unique set of challenges,” noted Pillitteri. “That’s why it’s extremely important to do your initial research, develop your business plan and seek out the ongoing, customized support you need to meet your business goals and your customers’ needs.”

These are some of the findings of an RBC poll conducted by Ipsos Reid between July 27 and August 3, 2007. The online survey is based on a randomly selected representative sample of 3806 adult Canadians of which 2,253 owned small or medium-sized businesses (entrepreneurs) and 1,553 aspire to own small or medium size businesses (aspiring entrepreneurs). With a representative sample of this size, the results among entrepreneurs are considered accurate to within ± 2.1 percentage points, and among aspiring entrepreneurs ± 2.5 19 times out of 20, of what they would have been had the entire adult Canadian population been polled.

RBC delivers a wide range of financial services and practical advice to small and medium-sized businesses and their owners. RBC is Canada’s leading financial institution for small business, serving one in four small businesses. Entrepreneurs - existing and aspiring - can visit www.rbcroyalbank.com/business/resources.html for practical advice and information about starting, owning and managing a small business.