There are millions of small businesses all over the world, which makes up for over ninety percent of companies in the whole world. When considering the most populous reasons for starting a business, which includes having a business idea, designing a career that can grow with you, investing in yourself, and working towards being independent financially, it is no wonder that businesses are all over.
However, not all businesses are in a successful position. It is about two-thirds of companies with employees that survive for two years, and close to a half finish five years. Therefore, you might be in for a challenge when deciding to take a plunge, become a business owner, and ditch the day job. The stage is set at the start, therefore, making sure that you have a small business plan while starting the business will give you a successful foundation. Below are the steps you need to take to become successful in your business.
Do Your Research
In most cases you have a business idea; therefore, it is time to balance it with reality. Does it have success potential? You will have to run the business idea via the process of validation before going further. For your business to realize success, you must solve problems, fulfill needs, or provide what the market needs.
There are a few ways for identifying needs, including focus groups, research, and trial and error. While exploring the market, the questions you need to answer include;
Who Needs It?
What is the competition looking like?
Is there a need for anticipated services or products?
How will the business fit into the market?
Ask yourself questions about starting the business before going into it entirely.
Make a Plan
You need a small business plan that will make your business idea real. The business plan acts as a blueprint or guides for the business from the start through the establishment and the then business growth.
The truth is that there are different business plans for each type of business.
If you have the intention of seeking financial support from financial institutions or investors, having a small business plan is a must. This business plan is thorough and lengthy and has sections that banks and investors look for when validating your idea.
In case you are not after seeking financial support, a one-page small business plan can give you direction about what you want to achieve and an idea of how you want to do it. You can create a functional plan on a napkin, and then improve on it with time. A written plan is always the best option for you.
Starting a business does not require so much money, because it involves an initial investment and the ability to cover recurring expenses before it becomes profitable. Come up with a spreadsheet that will help you come up with the startup costs for the business as well as what you need to keep the business running for the next twelve months.
When you combine these numbers, you will come up with an initial investment you require. Now that you have a number in mind, there are a few ways of funding the business including;
- Angel investors
- Small business grants
- Small business loans
Also, you can get the business off by bootstrapping, employing minimal capital to start the business. You might find a combination of the listed paths above to begin the business. The goal is working through options and creating a small business plan for setting up capital needed to get the business off the ground.
Choose the Business Structure
The business can be a sole proprietorship, limited liability company, partnership, or corporation. The entity you select will impact a lot of factors from the name of the business to the way you file taxes, to your liability.
You might choose the leading business structure, and change and reevaluate the structure as the business continues to grow and requires change.
Depending on the business’s complexity, it is worth investing in consultations from a lawyer to make sure that you are coming up with the right business structure.
Register and Pick the Name of the Business
The business name plays a crucial role in many aspects of the business; therefore, you would like it to be the best. Make sure that you are thinking through all implications while exploring your options and select the name of the business name.
After choosing the business name, you need to check if it has a trademark or in use. You will then have to register it. Sole proprietors have to register the business name with the county clerk or state. Limited partnerships, LLCs, or corporations register business names after filling formation paperwork.
Do not forget to register the domain name after choosing the business name.
Choose an Accounting System
Your small business will run well when you put systems in place. The most vital system for the business accounts system.
The accounting system will help in the creation and management of the budget, set prices and rates, conduct the business, and file for taxes. You can come up with an accounting system or employ someone to eliminate guesswork. If you choose to start by yourself, you need to make sure that you know what you need when selecting the accounts software after beginning the business.
It is essential to set up a business location for operating the business, whether it is from home, shared offices, or retail locations. Think about the overall setup, location, equipment, and make sure that the location of the business is working for what you are doing. Consider if it is making sense to the initial small business plan in place.
After coming up with a small business plan, you will have to get ready because it is time to start the business. You need to make sure that you take some time to outline positions required to fill, and other job responsibilities for the positions. The small business plan needs to have a guideline of employing people in your business for the success of the business. You need to outline strategies for outsourcing independent contractors if you are not hiring permanent employees.