Despite common beliefs, there is much more to starting a business than just capital. It involves many different aspects such as planning, market research and acquiring the knowledge of the legal aspects of opening a firm.
Let’s go over the key steps on how to start a business:
Choose a Business Idea
Your business idea will ultimately guide the direction that your business takes and gives a reason for all your actions. A good business idea is required to launch your business. However, it doesn’t have to be set in stone. As your business grows, so can your idea, which is how many multi-national's become so large. As per the advice of the Entrepreneurial Newsletter, Failory, “The most valuable thing you can do as a founder is recognizing your downfalls beforehand and learning from other business’ failures. Apply this knowledge to starting your own start up.”
Plan your Finances and budget
A recent study found that entrepreneurs that wrote a formal plan were 16% more likely to reach viability than a similar entrepreneur who didn’t create a plan. Planning for your finances and budget at an early stage is vital as it should prevent any hiccups and headaches further down the line. Plan for your sources of finance and map out the mandatory expenditures.
Decide on the structure
All businesses need a legal structure. The business entity you will choose will directly impact the owners’ liability, tax requirements, annual filing documents, and your ability to raise funds amongst other things. There are several options for business structure such as –
Although sole proprietorship has typically been the choice for many start-ups, recent trends have shown an increase in entrepreneurs willing to collaborate and become open to partnerships.
Find and setup a location
There are many factors that come into play when deciding your location. This includes what type of business, convenience for you and your customers and cost. It is an important decision, one that should take time and planning. Also, when you find a location, you’ll then need to purchase all the equipment, supplies, furniture, and inventory needed to launch your business.
Create your Brand
You’ve validated your business idea, created an execution plan, decided on funding, and picked your location and structure. You’re almost ready for your first client — but nobody even knows who you are or what you do. That’s where branding comes into play. When you see the logo of Apple or Nike, you know exactly who they are and what they do. Creating a recognisable brand is essential for explosive business growth.
Build your Team
You’ll need to hire employees as you grow. The best business owners are the ones who understand that running a successful company means focusing on their core professional competencies and finding ways to delegate other tasks and areas to people with expertise in that field. As said by Marc Benioff, CEO of Salesforce, “The secret to successful hiring is this: look for the people who want to change the world.”
Launch your Business
You’re now ready to launch your small business! However, the work that you’ve put into the launch is just the easy part. There are still sleepless nights ahead to ensure your business runs smoothly.
The challenges and stresses of starting a new business are not for everyone. However, the opportunity for unlimited rewards is tempting, and you too can achieve it with enough hard work, planning and effort.