This tutorial will explain the steps involve on how to start a small business from nothing to something. So take your time and exercise patience as it lead you through into the entrepreneurial world.
Ideally, starting a small business in a bid to become your own boss will be a great achievement you’ll ever be happy to have realised. What could be more thrilling than having a business of yours?
According to report, there are over 28 million small businesses across the U.S., taking up a large sum of 99.7% of all the businesses in the United States.
So why not start a small business of your own today?
Important of starting a business
Owning a business of your own has a lot of economic important. Some of the ideal reasons why people start a business including:
- You are your own employer;
- You have a flexible career that can grow over time;
- You work toward financial freedom;
- You are investing in your idea; etc.
Essence, majority of the entrepreneur minded fellow has been going around looking for a promising ways on how to start a small business successfully and of course, it’s true, not all new business venture is position to succeed.
In fact, it’s a proven theory that only two-thirds of small businesses survive after five years of its establishment. So if you are researching on how to start a small business, be ready for challenges too.
Things to consider before starting a business.
While it’s not normal to take a plunge, ditch the old job and start a business out of no where, there are some things that has to be considered before starting a small business, among them are;
- Pocket size
By pocket size, I mean financial capacity to kick start a business, grow it and develop it into a profitable business in the long run. If your pocket is too light and there is no hope of getting fund anywhere, don’t go into business.
- Products marketability
How well is the market of the products you want to capitalize on going? I bet you don’t want to invest in a business that is not moving. So ensure you conduct a thorough research before venturing into business.
It’s very wrong to dwell in a business you know little or nothing about because others are making money there. You need to have a general knowledge of the business you’ll be spending your money on before you take it on.
Is the business profitable at all? This are some of the few things you need to focus on before starting a business.
How to start a small scale business
Obviously, all the successful businessmen out there started their ventures from somewhere. Probably a small scale business before their brands became a household name today.
However, whether you’re starting a small scale business, medium or large scale business, to be discussed below are the necessary steps you need to take on how to start a small business from grass to grace.
How to start a small business in 10 steps
To start a small business successfully, these 10 things must be done in other to realize your set goals. Just take a step at a time and your journey on how to start a small business will be fruitful.
Step 1: Carry out a thorough research
Since you have an idea at hand you’ll also need to make such business idea come into pass and the best way to do that is by embarking on an in-depth research.
You need to test run the idea and see if it’s valid. At least, for a small business to reach it peak, it must be able solve a problem, offer something important to it target audience and fulfill a need.
However, there are quite numbers of ways you can adopt to identify these needs with a thorough research inclusive. You can also know your audience better via focus groups, trial and error and more.
While you’re doing your feasibility study on how to start a small business, some of the cogent questions that needs answer are:
- Do people really anticipate your products?
- Who are those that needs it the most?
- Who are your competitors?
- How stiffed is the competition?
- How will your small business fit into the competitive market?
Your ability to find a definite answer to those questions will contribute a lot to the success of your new business.
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Step 2: Write a working Business plan.
To make your new business idea a reality you need to devise a working plan. Really, the important of a business plan to a new business cannot be jest with.
Being a-must-have for any business, it’ll be the blueprint to guide your business to it promise land. It has to deal with all present and future endeavors.
Also, your business plan mist be written with the intention to solve a particular problem you forsee that might happen in the future.
How you plan to get the business funded, the marketing strategies you intend to adopt, your business goals, mission statement and the likes most all be present in your plan.
Always remember that the business plan will later come to serve as the propelling force that’ll pull your business forward in the long run.
Step 3: Plan Your Finances
Although starting a new business in a smaller scale doesn’t require millions of dollars but yet, you’ll need to get some initial capital investment ready.
If you have an investment capital ready that’s a good thing but if not, you can seek for fund from investors, financial institutions and local lenders. All these are necessary since you’ll be covering some startup expenses.
To help yourself out, you can draw up an analysis and estimate the amount you need to get started. You’ll need money to conduct market survey, business registration and licensing, buying of raw materials or products, recruitment and payment of staff wages, etc.
All these numbers if sum up will be your needed initial capital investment. So whatever the means you know that is legal and legitimate, use it to source for business fund.
Step 4: Choose your business structure
Choosing a business structure is one of the important aspects of starting a small business from the scratch. You need to choose the kind of business structure that suit you and your new business the most.
Essence, you can enroll your small business as a sole proprietorship business, partnership agreement, liability company (LLC), ‘S’ corporation etc. The business legal structure you choose will reflect on your business name, liability, business tax files, etc.
Note that you can go for a particular business structure now and check it as time goes by. May be when you grow the small business into a profitable business and gain a firm footing.
Step 5: Pick a business name
Your new business needs a name and as such you need to pick a unique name that is distinct and different from any other business name.
Be enlightened that the important of a business name to a business growth is much more than just be a name. So make sure that you come up with something worthwhile.
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Haven pick a business name for yourself, there are more things to follow. You need to check if the chosen name is free, available and not trademark by any business organization.
If the name is free from all vices, only then you can register it. If you’re running a sole proprietorship business structure, you’ll register the business name with your state or county secretary.
While a limited liability business, Corporations or partnership business structure will be registered their in the process of filing out other paper work.
Step 6: Get licenses and business permit.
To run your new business freely without any disturbance from the government or any of its agencies, you’ll need to get all the needed licenses and business permit. This part should be taken seriously on how to start a small business successfully.
You’ll need to fill out some paperwork — although it’ll cost you some dime — as part of the required process to starting your own business. Depending on the kind of business, you’ll be running and where the business will be situated, business license and working permit varies.
So do your research well to know and understand well which is necessary and which is not.
Step 7: Define your financial system.
Choosing a definite accounting system is key to your new business establishment. It’ll assist your small business in running effectively and efficiently.
Your accounting system will help you to create and manage a decent budget, set good rates and prices, file your taxes, carryout businesses with other promising firm, etc.
If you’re capable of it, the accounting system may be set up by you and you can hire an expert to do away with guesswork.
Step 8: Choose a business location
Setting up a nice place to run your proposed business is also vital. It’s important you choose if it’s your home that will be used pending the time you get an office or the other way round.
Depending on the kind and nature of the business you’ll be setting up, it’s very important you consider the atmosphere of the environment your business will be located.
However, whether you’re buying yourself a land or renting out an apartment, setting up the place really nice and fitting is advisable.
Step 9: Hire the needed staff or employees.
Although you’re starting out a small business but yet, you’ll need some hands to help you run the affairs of the business smoothly. Hence, now is the perfect time to hire the best minds.
Choose meritocracy over mediocrity or else it will come back to hurt you. Employees only the need staff for the time being. Don’t go about taking everybody in. Your business may collapse if you fail your workers.
So getting only the necessary staff ready at this stage is crucial on your journey to learning how to start a small business from nothing to something.
Step 10: market your small business
The moment your business is up and run, there’s nothing left than to promote it. It’s through marketing and advertising that your target audience will get to know of your products existence.
Devise the most probably marketing strategies and be on top of your game. Remember that there are too many competitors that their products have reached a unique selling point (USP) out there.
So help your new small business by giving it a decent advert and marketing. Play your game by the book. That is, follow the marketing plan you had in your business plan and let everything work as planned.
It can, however, be deduced from the above that starting a small business from the scratch needs a thorough research, workable business plan, a unique business name, registration and licensing, business structure and location and more.
But by now, you should understand better that starting a small business isn’t really a difficult spree for those that know their way. So take your time to study this guide on how to start a small business and you shall smile in the end.
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