Starting a new business can be thrilling as well as challenging. An entrepreneur can be anyone and does not require a college degree, a lot of funds in the bank, or business experience. Transforming a great idea into action can be frustrating and small business owners often feel overwhelmed when they don’t develop a detailed plan.
If you want to get started but are unsure how to start we have developed a simple and effective approach.
Follow our step-by-step guide to help turn your big idea into a successful business.
Not all these steps will apply to all businesses, but working through them will give you a sense of what needs your attention and what you can check off.
1. Develop a Business Plan
Planning is essential and your business plan should be considered the foundation of your business. A business plan is a written description of how your business will evolve from when it starts to the finished product. The key to success for a small business in the startup phase is to keep things simple and costs low. It is important to remember that the business plan is a living, breathing document and as time goes on and your business matures, you will be updating it.
Here are some points we suggest you include in your business plan:
- Business description. What kind of business do you want to start? What does your industry look like? What will it look like in the future?
- Market strategies. What is your target market, and how can you best sell to that market?
- Competitive analysis. What are the strengths and weakness of your competitors? How will you beat them?
- Design and development plan. What is your product or service and how will it develop? Then, create a budget for that product or service.
- Operations and management plan. How does the business function on a daily basis?
- Finance Factors. Where is the money coming from? When? How? What sort of projections should you create and what should you take into consideration?
2. Research Your Market
Is anyone else already doing what you want to start doing? If not, is there a good reason why?
This step of developing your small business may not be exciting, but there is no way around it. For products and services already available, marketing research can tell companies whether they are meeting their customers’ needs and expectations. By researching the answers to specific questions, small-business owners can learn whether they need to change their package design or tweak their delivery methods, and even whether they should consider offering additional services. There are many different types of research methods including:
- focus groups
You also want to evaluate competitors and potential partners in your market. Evaluating your competition can help you establish benchmarks and identify target segments.
3. Decide on a Budget
Your business plan will help you figure out how much money you’ll need to start your business. If you’re self-funding, be realistic about numbers and whatever you anticipate your budget to be. We believe that an additional 20 percent tacked on for incidentals is a realistic overage amount that helps you accurately determine an appropriate budget. If you don’t have that amount on hand, you’ll need to either raise or borrow the capital. Fortunately, there are more ways than ever to find the capital you need. Learn more
4. Pick Your Business Location
Choosing a location is often overlooked by many entrepreneurs, however, it may be the most important decision you make. Many factors come into play while choosing a location such as proximity to suppliers, the competition, transportation access, demographics, and zoning regulations. Regardless of your business being a brick-and-mortar or online store, the choices you make have the ability to affect your taxes, legal requirements, and revenue.
5. Decide on a legal entity
Going it alone or forming a partnership? Thinking of incorporating? What about an LLC? The legal structure you choose for your business will impact your business registration requirements, how much you pay in taxes, and your personal liability. Additionally, filing paperwork to start a business costs money. Do a thorough search ahead of time to determine what the filing fees are for your city, county, and state before starting any business.
In the “test” phase of your startup, it can be wise to start as a sole proprietor. You will face less paperwork and up-front fees and expenses. You should be aware, however, that acting as a sole proprietor can put you at personal risk. We highly advise to weight the benefits vs. risks and speak with a local tax professional or Certified Public Accountant to decide which is best for your short-term vs. long-term goals.
6. Choose Your Business Name
It’s amazing how crucial a name can be. It plays a monumental role in a brand’s growth and perception, meaning it can completely make or break a company. In fact, it’s the first thing a customer sees, sums up everything about the company, and gives your unique take on an industry. To put it simply, it’s more than just a name, it’s the identity of an entire brand. It deserves time and attention, and when handled properly, it’ll change a business forever.
7. Register Your Business
Once you have decided on the perfect name for your business, it is time to make it legal and protect your brand. Receiving federal and state tax IDs is essential for your small business. You will use your employer identification number for important steps such as opening a bank account and paying taxes. Some, but not all, states require you to get a tax ID as well.
8. Hire Employees
Hiring is one of the most difficult aspects of running a startup. With teams of less than a handful of people, each new hire could make or break your company’s future. Even if you are starting as a one-man show, as your business grows, it will eventually require hiring employees.
9. Get Your Website
Consumer behavior changes over time to adapt to modern technology, and consumer behavior has changed to adapt to the digital age. Regardless of whether your business will be brick-or-mortar or online, you’ll need a website, and that means securing a URL. Popular domain sites such as HostGator and GoDaddy will allow you to search for the website domain address of your choice and purchase it for as little as $9.99.
10. Open a Business Bank Account
Open a business account when you’re ready to start accepting or spending money as your business. A business bank account helps you stay legally compliant and protected. It also provides benefits to your customers and employees. Rates, fees, and options vary from bank to bank, so you should shop around to make sure you find the lowest fees and the best benefits.
Limitless Investment and Capital Small Business Services
Our team found Limitless Investment & Capital out of the desire to offer middle-market firms with the sophistication and high-level services larger companies receive at an unbeatable, affordable rate. Our professionals have extensive experience and are accustomed to the challenges involved in working in demanding atmospheres. We view ourselves as partners in your success, serving as a value-added extension to your internal team. We also understand that every business is different, so we’ll tailor our strategies to meet the specific needs of your company. We offer:
- Business Accounting Services
- Bookkeeping Services
- Part-time Controller/CFO Services
- Tax Preparation & Assistance
Not sure how we can help your small business? Let’s start a conversation!