Starting a business in the world of today is increasingly encouraged. Besides, it is easier than ever before to start your very own business. The United States alone is home to over 25 million small businesses. If you have a unique business idea or are planning on creating a new career for yourself that offers incredible flexibility, then starting a business is just what you need. There is a reason why new small businesses are propping up.
However, this does not mean that every small business is poised for success. According to various studies, it is found that only two out three new businesses fail within two years. It can be a real struggle to get your business to take off. If you want to take the leap of faith, then this 10-step guide to starting a business is just what you need to read. Everything that you need to know is discussed in this post.
Research is crucial to running a successful business. Since small business owners only have limited funds, it is imperative to conduct research in order to ensure that the business idea is viable. Chances are that you have a business idea, but you need to balance it with the ground reality.
You need to back your idea with market research. Find out if your idea has the potential to be successful. Use a validation process to determine if your business idea is bound to be successful or not. Learning more about the market through research allows you to better cater to the needs of the market. A great way to learn more about the market is through focus groups.
2. Create a Plan
If you want your business idea to be a success, you need to have a plan in place. A plan sets the blueprint for the business. Each step of the business plan will be covered to ensure that the business gradually progresses from the start-up phase and enjoys growth.
Every new business needs a plan in order to succeed. There are different types of plans and that is why you need to know which plan suits your business needs the best. Moreover, it is crucial to have a plan if you intend on seeking support from a financial institution or lender. Make sure to have a plan in writing and evaluate it continuously so that changes are incorporated.
3. Plan Finances
Although starting a small business does not require a lot of money, it is still vital to plan your finances accordingly. You need to ensure that you have planned your finances to cover the expenses until you start making a profit.
Create a spreadsheet and enter estimates of all the one-time costs and operational costs for at least a year. Costs related to marketing, utilities, rent, legal fees, branding, and market research should all be accounted for. It will give you an idea of the expected initial investment. It is crucial to have a rough amount in your mind to figure out if you need to seek a business loan, grant, crowdfunding, or an investor to help out with the expenses.
4. Determine the Business Structure
The business structure of your small business should be determined early on. Whether you want to run a corporation, a limited liability company (LLC), a partnership, or just be a sole proprietor, you need to figure it out beforehand.
The business entity which you select will affect many factors such as the amount of liability, the business name, financing options, tax payments, and who runs the management.
Make sure that you understand the type of business you choose as it will impact decision-making, financing options, and the overall success of your business. Moreover, it is possible to select an initial business structure that can be changed in the future after some reevaluation.
5. Select a Business Name and Register It
When starting a business, keep in mind that picking a good name is crucial. The name of a business plays a huge role in just about every aspect of the business. This is why you need to make sure to choose a suitable one.
Choose a business name after you have considered all potential implications. After you have decided what the business name should be, it is a good idea to find out whether it has been registered as a trademark.
6. Get Permits and Licenses
No matter which industry you choose to operate in, there is always paperwork. It is a part of the business world. There will be a need to obtain permits and licenses depending on the location of your business and the industry. Research about the requirements for obtaining permits and licenses before you even consider starting a business because oftentimes, it can be difficult to obtain a permit.
7. Select an Accounting System
Accounting is considered to be the language of business. In order for a small business to run effectively, it is crucial for there to be an appropriate accounting system.
Having the right accounting system makes a huge difference. The system will help ensure that you create a budget and manage it accordingly. You might also need to consider hiring an accounting to manage the accounting system.
8. Decide the Business Location
Location is vital and it determines the success of a business. You need to choose an affordable location that is convenient for customers to visit or simply affordable if you want to have a home office. There are different types of business locations to choose from. You will need to consider the overall setup, equipment, and customers when deciding the business location.
9. Create a Team
Behind the success of every business lies a team. In order to create the right team, you need to hire the best employees. Make sure that the positions that need to be filled have been properly outlined as well as the job responsibilities.
10. Promote the Business
Finally, if you want someone to notice your business, you need to effectively promote it. Develop a marketing strategy to attract customers to buy from your small business. Social media is your best friend when it comes to marketing.