Talk to any entrepreneur or small business owner and you’ll quickly learn that starting a business requires a lot of work. An idea doesn’t become a business without effort. If you’ve always dreamed of quitting your day job and gaining independence by becoming your own boss, here’s a step-by-step guide with everything you need to know to make your daydream a reality.
1. Research Your Idea
If you already have an idea for a small business, you’re ahead of the game. An idea is just the seed, however; the first step in starting your business is determining whether there’s a market for your idea. The important thing is to understand the market for your product or service before starting a business. You’ll likely need to do some fact-finding using market research methods such as surveys, focus groups and interviews. You’ll also need to conduct a thorough competitive analysis of similar businesses in the market.
2.Write a Business Plan
The research phase is where you flesh out your idea — now it’s time to get it down on paper. If you’re not currently planning to apply for financing with a traditional bank, your initial business plan can be relatively simple. a basic business plan should include the following sections:
- Pricing Strategy
- Marketing and Advertising
- Action Plans
3.Create a Budget
Whether you plan to minimize expenses with a lean startup approach or you’ve already saved the capital to launch your business, estimate the costs associated with starting and running it. Set up a system to manage your finances that keeps business income and expenses completely separate from personal income and expenses. This will make your life much easier come tax time.
4. Decide on a Business Structure
Incorporating your small business protects your personal assets from business liability. This means the business is legally considered a separate entity, so your house, car and other property cannot be seized to pay business debts or legal judgments. Incorporating your business also has tax advantages. Whether it’s best for you to establish a sole proprietorship, a partnership, a limited liability company (LLC) or a corporation depends on the type of business, the number of employees and other factors.
A business attorney can advise you on the best strategy for your specific venture. For most sole proprietors, keeping the business structure as simple as possible will keep costs low as you’re starting out and give you a chance to determine the ideal setup as you grow.
5. Name Your Business
Naming your new business can be one of the most fun parts of becoming an entrepreneur and also one of the most challenging. Think about what your business stands for and what you hope to accomplish. Think about your mission statement and the message you want to portray. Consider whether you want to choose something that is easy to pronounce and remember or a unique name that sets your business apart from the crowd. Have a brainstorming session where you write down every name that comes to mind, then test your favorites with trusted mentors, friends and colleagues to gauge their reactions and get feedback about the main contenders. When you have a finalist, take a few days to let it settle before making your ultimate choice.
Once you’ve brainstormed the best possible name for your new business, use your state’s business name search function to make sure it isn’t already in use. Even if the name you have in mind is available, make sure you can also reserve the domain name.
Many new entrepreneurs get stuck in the naming and branding stage and don’t move forward because they are waiting to think of the perfect name. Avoid this pitfall by choosing a memorable, evocative name, even if you don’t necessarily fall in love with it right away. Doing so will allow you to get the ball rolling on your dream.
6. Find a Location
Unless you’re starting an online or home-based business, you’ll need to find the ideal physical location for your enterprise. This is where you’ll register your business, obtain the required permits and licenses and pay local and state taxes. These items can be much more costly in some municipalities than in others, so do your research to make sure you choose a city that’s on the more affordable side. On the flip side, some state and local governments offer tax incentives and credits for new businesses, and federal incentives are available for new ventures in certain zones that are historically underutilized.
7. Create an Online Presence
After registering your domain name, set up a website for your business. If you’ve never built a site before, try using one of the many free tools to create a business website that are as intuitive as creating a Word document, with simple drag and drop functionality. If you plan to sell products online, sites like Shopify charge a reasonable monthly fee for a virtual storefront with online shopping cart functionality. This is also the time to set up social media accounts and promote them on your new site. Don’t forget to create an official email address for business use.
8. Start Promoting Your New Business
If you want to have a successful small business, get used to telling everyone you encounter about your new venture. Join your local chamber of commerce, and explore the resources they offer to fledgling small businesses in your community. They might have a platform where you can present information about your business or meetings where you can network with other small business owners. If you’re selling a product, set up a booth at a local farmers market and provide free samples. Use this as an opportunity to gather market research and test the public response to your offerings. Although business cards might seem outdated, they are actually a useful networking tool that provides something tangible to give potential customers, increasing the chance they’ll remember you when they need your product or service.
Announce your new business on social media, and ask friends, acquaintances and potential customers to follow your business pages. Drive traffic to your website by promoting sales or sharing content related to your industry. Facebook and Google both offer low-cost ad programs that can get your content in front of more viewers.
9. Purchase Business Insurance
This is a critical step that will help protect your financial and intellectual investment from unforeseen circumstances such as theft, customer lawsuit or property damage. While a general liability policy is sufficient for most small businesses, those who hire employees will also need to purchase unemployment compensation and worker’s compensation insurance. Professional liability insurance protects you if something goes wrong when you’re providing professional services.
10. Explore Helpful Resources
In addition to your local chamber of commerce, your community and state likely offer a wealth of information and resources for new business owners.
We wish you the best of luck with your business adventures for a business plan template subscribe to our mailing list below.
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