How to Start a New Business in Five Easy Steps
So you have a plan for a new business, and you are wondering how to take it to the next level. At this point, you have probably mulled around ideas that would be great to share with the world, possibly new inventions, new ways of offering services, or an existing product just with your spin or brand.
How do you go about starting your own business? The process is multi-tiered. You need to start by formulating an actual strategic business plan around your idea. Your plan should include anything and everything that you will need to start a business from top to bottom.
1. Start with a sound business plan.
Your product or service is just one part of the plan. It will include a right amount of detail for each area of your business. It should be presented in such a way that licensing and permit agencies want to grant you the required certificates, and that any individuals or banks also will want to help you make an investment.
To make a catchy business plan, you should outline what your business ideas are and how they will work. The more detail you provide, the better. It will show that you have thought out every aspect of your business and that you will be a responsible new business owner.
2. What will you do in your new business?
The details of your plan should include what are you providing, who is your target audience, and what is the product you intend to deliver to them. You should do excellent market research that includes qualitative information as well as financial, demographic and other quantitative data. Are there competitors or similar businesses? Why is yours different or unique? Do a good market survey to get the lay of the landscape, so you know where you are walking. Even McDonald’s and Burger King still do their market research when they decide to build a restaurant blocks away from each other.
3. With whom do you need to work?
This question is quite broad. You may need to collaborate with others on parts of your business plan itself, and you also need to look down the road a bit further. Will you need to get permission from some authorities, regarding licensing, registrations, permits, etc.? You will also have to apply for a federal tax identification number (F.E.I.N.), and register with your state and local agencies. If so, you should do your homework and investigate what you will need, what it will cost, and what you need to prepare to begin those processes. Be sure to keep good records and don’t drop any balls, or it may prolong your plan.
What vendors will you need? You should start sourcing and get quotes from them, at least three that you are comfortable with to start. How many staff members will you need and how will you reimburse them? These are all facets of the business you cannot overlook.
4. How much dough will it take to start?
A large part of your new business plan should include figures for anything that can be measured. Everything you do, buy, create, license, distribute, market, ship or dispose of will have costs. Think as small as a postage stamp and as big as a warehouse. Prices also include overhead, person power or transportation. Will you need to rent or buy space?
Will you need partners or investors, whether it is for financial or other types of supports or resources? You will need to map these out, determine what roles they will play, and what you need to “input” that will result in your anticipated “output.”
You must include anything and everything, and do real research lest you be surprised with costs you did not expect which could mean financial losses down the line. Also, savvy business investors will see what is reasonable, or what is missing, and judge your viability based on your data and your plan. Your calculations should also provide financial projections, which is the whole reason you are probably starting your business in the first place, to make a profit. So make sure you are thorough and as accurate as possible.
5. How important is marketing to a new business?
Having a good product or service is quintessential to a successful business, but letting the right people know about it is just as important. You can have the best product in the world, but unless people (i.e., your target market) know about it, then it won’t do much good. Timing is everything as well. You need to create the demand to your supply.
Whether your business is strictly e-commerce or not, you will want a good website. Make sure you have a reliable website and an e-mail service that goes along with it. Many website packages include hosting and e-mail set up as well. BlueHost.com provides great service that that has worked well for this site.
Traditional methods of advertising include mailers, billboards, news inserts, radio, etc., but most new businesses can get more bang for their buck by putting funds into online marketing as opposed to a week-long billboard on the side of a highway. Using Google Ads or Facebook pay-per-click (PPC), you can set up your ad campaigns that you can tweak and tailor as you go. You can also fund them as you go, and it is less of a commitment than hiring an expensive firm.
You can also hire someone who knows exactly how to do these things, and who can tie your social media, blogs, and your ads back to your website to create traffic that will help convert your ads into sales. If you can offer something directly on your site, that is a bonus. Sometimes that is not possible, as with some services, but having good content and contact information on your site is essential.
You can also tie in payment systems to your website if you offer services and products this way. In any case, you will need to research and set up the proper payment systems for your work. You should also determine who will handle all of the accounts payables and receivables.
Expect that implementing everything in your plan will take five times longer than you assume it might, however, and do not get frustrated. Just be thorough, pay attention to detail, and be persistent. These are qualities of any good business owner. It will be worth it in the end. If you have thoroughly set up steps A to Z and have followed your business plan, you soon will be on your way to making a profit.