Starting any business, big or small, takes preparation and planning. The fear of failure and the amount of work one must put in cause many people to give up on their dreams of becoming entrepreneurs. If you have been thinking about starting a business, brace yourself to break some sweat. The start may feel stiff, but the results could change your life entirely.
The process of starting a profitable venture is intimidating. However, this guide can help you every step of the way. Here is a step-by-step guide to starting a small business.
1. Self-Evaluation
Evaluate yourself and reflect on why and how you want to start a small business. Owning a business is a heavy responsibility that requires the right mindset. You ought to find out why you want to follow that dream. Looking into yourself will help you clearly define your why and what is more important to you.
Understanding your personal goals can help you establish the vision for your business. Without this in mind, you will be out of business as soon as you get the first client. A personal reason for starting a business serves a smaller scope than a marketplace reason.
Ultimately, a better understanding of your mission and vision also points to your strengths and weaknesses. A SWOT analysis can help you focus on vital areas that need improvement and find solutions to help you cope with your weaknesses.
2. The Idea
Whatever idea you have, add a personal touch. If not, there are several options in your mind. With that said, you can still use one that exists already. However, you need to refine the existing concept for your business to work. Look into the market and carefully observe how the competition serves their clients.
If you are working on an already existing idea, think of ways to make it even better. Consider the following:
- Can you do it better?
- Can you offer the product/service quicker or faster?
- Is there a way you can make your services cheaper?
- What new features will your product or service have?
When you take the above into account, you can refine the idea to suit your business goals. If you do not know what to do, choose an already existing franchise and become a franchisee.
Now, it is time to name your venture. Naming your business is very important. The name should be unique and creative. Think of your target customers. Who do you intend to serve with your business? You can enlist help to name your business if you are struggling.
3. Business Plan
It would be best if you had a well-laid business plan for your new venture. A good business plan answers several questions about what your business aims to achieve. Think of the following when making your plan.
- What are your overall goals?
- What is your budget plan?
- What purpose do you intend to serve?
- Who are your target customers?
Before you write that plan, you need to follow the due process. Start by conducting market research. Good market research will help you prepare your business for the launch. Understand your target customer, their needs, likes, and dislikes to serve them better. Good research gives you a competitive advantage as you already know and understand what the market needs.
An exit strategy is essential for every business. Knowing when to leave the table saves you from severe losses. Think of it as when you want to know the exits of every building before you go inside. Plan how to exit the market when things do not work out or find something more profitable.
In case you do not have time to do all that, find a reliable business plan writer to help with the process.
4. Count the Costs
Look into the costs of everything you have to spend on your business. Outline everything you have to do and what it will cost you. Consider things like location, rent, marketing, and supplies.
Once you have a figure, do not get excited. Expect to spend a couple more times than that. Business expenses grow by the day, and you will need to be ready to cover them each time they rise. Using the figures, create a business budget. That will help you determine whether you need more funding to finance your business.
There are several financing options for your business. You can seek investor funding, get partners, ask for funds from friends and family, or get investor loans. Additionally, bootstrapping is a great way to start your venture on low cash.
5. Meet Legal Requirements
Once you have everything set up, it is time to make your venture legal. First, understand the type of venture you are running and register your business name by visiting the registry in person or paying online for the registration.
Here, you’ll define whether your business is a sole proprietorship, LLC, Corporation, or partnership. If you are not sure, seek help from a business expert. They can help you discover types of business entities and help you define your business. Once you do, start the registration process.
If you are based in the US, get tax licensing from the IRS and any other legal permits required in your state. Licenses and permits to sell goods are must-haves for your business. If you are based in the UK, it would be prudent to register with Company House, which is responsible for regulating, incorporating, and dissolving UK companies. Once registered, the Companies House search service will bring up all of your company details for anyone searching the system for more information about your business.
Ultimately, all business processes should be done legally. For example, hiring and firing should always follow labor laws. Moreover, anything involving your finances and taxes should be done with an accountant.
6. Strike a Balance Between Passion and Wisdom
While passion is great, balance it with wisdom to see your business succeed. For instance, you may have a passion for starting your venture, but wisdom will tell you not to quit your day job yet. Your day job can help you get the money you will need to keep the business running.
Passion keeps you going and helps you improve business operations. However, you have to use knowledge and wisdom to guide you with daily decision-making. Use that passion to reach out to market experts for advice.
Conduct surveys and learn more about the market. Knowledge shapes your business decisions. Talk to potential customers and promote your business.
The Bottom Line
Establishing your business will be challenging but worthwhile. Get ready to put in the work. With time, everything will come together, and you can enjoy your earnings. However, brace yourself to learn new things to mitigate any issues the journey will throw at you. If you follow the guide above, building your business will be a breeze.
About the Author
Matt Casadona has a Bachelor of Science in Business Administration, with a concentration in Marketing and a minor in Psychology. He is currently a contributing editor for 365 Business Tips. Matt is passionate about marketing and business strategy and enjoys the San Diego life, traveling and music.
