The barriers to starting a business are much lower than they used to be, but it’s still no small feat. Before you can reap the benefits of earning your first profits, there is some work that should happen before you open your doors (or virtual doors). Here are the top 6 steps to take before you start your own business:
1. Ask yourself, “why?”
Before you even start your business plan (we’ll get into that shortly), ask yourself the “whys” – why do you want to start your business? Why will customers want to use you over anyone else? Why will someone want to work for you? Answering these questions can help you outline and develop the purpose and mission behind your business. The passion and motivation that gets you started will serve as your compass to guide you through business decisions in the future.
2. Research your market
Understanding your target market and what really makes them tick is critical. Think about what problems your product or service is solving and who is experiencing these issues. If the market doesn’t exist, then your profits won’t either. Researching competition and price is also important. Make sure you know who is out there, what they provide, and how you will compare.
3. Find a name
Deciding on the right name for your new business venture can be a real struggle. One way to find a catchy and memorable name, is to use a source like Naminum. With a few words of inspiration, Namium will generate an extensive list of business names, saving you hours of brainstorming. Create a short list and take it to your first test market – friends and family – to see which names stands out. When you’re ready to lock it in, check if it is available and get it registered so it stays yours.
4. Develop a business plan
Going through the process of writing a business plan is a good way to get your ideas together and to set some initial goals. Remember though that a plan is not carved in stone and should evolve as things progress. A business plan will serve as a guide to keep you heading toward profitability. Develop as much of your business plan as you can – forecast expenses, identify your target market, how you’ll reach that market – then seek out experts, like an accountant for the financial projections, to help you with the rest. Your business plan should be something that you review and update regularly to keep your business focused on success.
5. Make it legal
There are laws in every area that govern the operation of a small business and can regulate everything from documents to how you conduct your business. Before you start performing work and accepting payments, be sure to get your legal paperwork in order – register your business, purchase the rights to your business name, get a tax ID number from the IRS, register with your state-level tax authorities, and apply for any licenses and permits you need to operate your business. If you don’t have the services of a lawyer you can draw from, websites like LegalZoom cover a lot in terms of small business legal solutions.
6. Get technology on your side
As the wearer of every hat, you’ll want to make the most of technology to automate as much as possible, and find every opportunity to optimize your efficiency. You’d be surprised how much having the right tools in your pocket can free up your time and workload. Research what’s available to you in the form of simple business apps. A few of our favorites are Docusign for digitally signing and collecting signatures on documents, Strikingly for simple and beautiful websites, and (of course) Invoice2go for tracking your work, sending invoices and getting paid. Invoice2go’s mobile payments feature does a lot of the legwork for you, saving time and getting you paid faster. Allow your customers to pay digitally through the invoice, and never have to chase down missing payments again.
Need more info? The US Small Business Administration has online resources and offices around the US. Many cities also have their own resources available to help businesses start up and boost the local economy. Been there done that? Share any additional tips you have for other blossoming businesses in the comments.