So, you’ve decided to start your own business. First of all, congrats on taking this exciting step! There’s never been a better time to be an entrepreneur (more women are creating businesses than ever before!), and you’ve got the potential to help improve not only your own financial life, but also to serve your local community and help it thrive.
Before you dive in, take a look at these steps to success.
Step 1: Have a clear idea of what your business will be
Before you do anything else, you’ll want to make sure you do your research. Your company should solve a problem, fulfill a need or offer something that’s not already available in a particular category. Additionally, you’ll need to define your target customers. Try to figure out how you are different from your competitors and why your target customers would want to invest in your product or service. Through research (Google will be your new best friend!), you can gain insight into your potential competitors to explore how your business can stand out. This research step is essential to avoid creating a business that isn’t sustainable. In the end you’ll be grateful you spent the time finding a sweet spot in the market where your company can flourish.
If you’re not sure where to start, take a look at this free online course that will help you evaluate your business idea and determine your strengths as you begin.
Step 2: Build a business plan
Your business plan doesn’t have to be long. In fact, many people have found a simple one-page business plan will do the trick. Think of this as your guide for the first three to five years of your company. It should map out how you plan to start, any potential obstacles and steps you could take to overcome those obstacles. You’ll also want to include the strategy for your business that outlines your reasoning for everything from sourcing and staffing to how you’ll manage your money. Make sure to always have your plan on hand, so you can reference your strategy and tweak it as you go. Don’t be afraid to go too in-depth – this is essentially the most important step to planning a successful business!
Need some inspiration to get started? Check out this simple one-page business plan template.
Step 3: Plan your finances
Starting a business is a big investment, so it’s important to plan for it. Start by putting together a spreadsheet estimating all the one-time start-up costs, such as licenses, permits, legal fees, etc. You should also figure out how much money you’ll need to keep your business running for at least the first 12 months. Adding these two numbers will give you the full amount you’ll need for an initial investment. And it’s not a bad idea to save a little more than that amount, just in case. If you need help, check out all our business loans.
Step 4: Make it happen (legally)
Once you’ve done all the necessary planning, it’s time to make it legal! For the majority of small businesses, making your company official is as easy as registering with state and local governments. In some cases, it’s not necessary to register at all, but keep in mind that if you don’t register your business, you run the risk of missing out on personal liability protection and both legal and tax benefits. After registering, you’ll need to obtain your Employer Identification Number (EIN) to pay federal taxes, and then you can hire employees, open a bank account and apply for business licenses and permits.
Remember: Never lose sight of your plan and your new business will thrive!
