You want to launch a business of your own- but must first lay the groundwork for that business success. Now is your time for preparation, research and hard work:
“It’s not just about ideas, it’s about making ideas happen…”
- FINE-TUNE YOUR BEST BUSINESS IDEA
Identify “why” you are launching your business, and if your “why” is meeting a personal need or a marketplace need, so as to determine the scope of your business (Stowers, 2021). Clarify if your business idea is profitable, attainable, and above all, one about which you are passionate.
Let go of originality. With the countless businesses out there, good ideas or products are likely thought of already, or soon will be. Focus instead on businesses that can be improved or on which you can put your own stamp. Your business can be unique, not because it was the first one, but by how you make it better. List businesses that you find inspiring, then think how you would do them instead. “Remember Facebook was not the first social network and Google was not the first search engine.” Marianne Cantwell, founder of Free-Range-Humans.com (O’Conor, 2015).
Use your skillsets. Your existing skills or beloved hobbies can turn into a profitable business. You are more likely to make your business idea a success if you use the skills you already have.
Solve a problem. There are areas of opportunity around you if you look at yourself, co-workers, or friends, and think of ways to solve problems in their lives with better products or services. Countless objects that are common today were inventions/improvements someone noticed and filled that need (packaged breakfast cereals, kitty litter, Bluetooth, rocking chairs, sleeping bags, compression socks, Tupperware…et al). Think creatively for applications around you.
Look abroad for inspiration. Traveling can provide inspiration. There are products elsewhere that have not been marketed locally, or ideas that have been done differently or better elsewhere that you can introduce (O’Conor, 2015).
Consider franchising. This option builds on an established company, with a following and business model already in place. You just need the location and means to fund your operation.
Do some market research. As you narrow down your business idea, do market research on potential clientele to help you understand your target customers- who they are and why they will buy from/hire you. You can conduct surveys, hold groups, research public data, look at demographics and competitors (Stowers, 2021). During this process you need to be formulating your business name/logo.
“If you don’t know where you’re going, every road will get you nowhere…” - FIND YOUR ROAD TO SUCCESS WITH AN AWESOME BUSINESS PLAN
This is your road map for the future of your business. The executive summary is your mission statement (main focus of your business) and description of your products or services, ownership structure and summary of your plans.
The company description is the snapshot of your small business (registered name, domain name, address of physical locales, details about products or services offered (Nicastro, 2020).
Your objective statement (business goals) spells out exactly what you want to accomplish, short and long term. If you need outside funding, this is where you can explain why you have this need for funds, how the financing will aid the business to achieve your growth targets.
The business and management structure portion of your business plan is the company’s legal structure with liabilities and taxes in mind. This states the details of your company’s structure- e.g. LLC (limited liability company), sole proprietorship (can affect your personal credit), S Corp (lower taxes but more limited growth potential), or C Corp (higher taxes/more flexible) etc. (Orem, 2021). Your business plan must also clarify key employees, managers or other business owners. You can utilize business or legal advisors or sources found through Small Business Administration (www.sba.gov) for help with this structuring (Nicastro, 2020).
“I am one step away from being rich, all | need now is money…” - ASSESS YOUR FUNDING
How much funding will you need? How much are startup costs? What type of funding will you obtain- business commercial loans through a bank, or SBA Small Business Loans? Are you eligible for any business grants that do not need to be paid back? Can you self-fund to avoid loans? Can you launch a crowd-funding campaign, where large numbers give small donations? Can you bring in a group of investors, that will bring capital but may want a hands-on role in running your business? The answers to these questions will help clarify your funding.
“A bank is a place that will lend you money if you can prove that you don’t need it.” - CHOOSE YOUR BEST BUSINESS BANK
You want a bank that will meet your specific banking needs. Schedule meetings with various banks and ask questions about how they work with small businesses. A business credit card is also a consideration (to be used only for business expenditures for tax deductions/expense monitoring purposes). Your bank may have credit card options for your business. (There are also many other specialized credit cards that may work specifically for your business- based on factors such as needing multiple employee credit cards, getting cash back for gas, travel perks, etc.)
“The Internal Revenue Code is absurdly complex or, as we lawyers Say, a goldmine…” - HOW TO LEGALLY ESTABLISH YOUR BUSINESS
You need to obtain a variety of business licenses before legally operating your business in compliance with federal, state and local guidelines. This process can be costly and does take time- legal counsel can ensure you are in compliance with all requirements for you business (Schooley, 2020).
Common licenses can be business operation licenses, DBA (doing business as) permits, planning and zoning permits, building and home occupation permits, fire department permits, health licenses, environmental licenses (depending on your industry), sign permits, industry-specific licenses, and seller’s permits.
Finally, essential for tax purposes for your business is an Employer ID Number (EIN) or Federal Tax Identification Number. This EIN is used to identify your business entity, enabling you to hire employees and collect payroll taxes. Also you need to check with your state to see if a state number or charter is needed for your business (Schooley, 2020).
“Don’t find customers for your products, find products for your customers…”
- Former Dotcom executive and author Seth Godin
- Former Dotcom executive and author Seth Godin
- FIND YOUR CUSTOMER BASE
Identify your ideal client and narrow your focus so as not to overstate your market
(e.g. do not broadly try to market to all women, or all Baby Boomers).
Discover where your customer lives– media, online, offline, mail, etc. and target messages to them. Forums, social media pages, similar businesses, and conferences are all target areas for your potential clients.
Know your business thoroughly. If you understand your industry and the place your product or service has in it, you can attract people that see how knowledgeable you are.
Give clients good reasons to try your services. Provide value with the in-depth understanding of problems that people are looking to solve. Webinars, blogs, guest blogging, and physically networking are all ways to attract a following (Bawden-Davis, 2021).
Customize the correct website for your business. Today every business should have a website for potential and previous customers. It is your online storefront, even if you have a brick-and-mortar location. It is the place to show off your products or services, explain who you are and what your company is about. Your website needs to be easy to use and also have payment processing available. There are many options for you to create your website, based on the complexity your business demands. You can choose a do-it-yourself website builder (eg. Wix), use a pre-made template for an open source content management system (CMS), hire a web design company to build a custom website on a CMS, or hire a web design company to build your website with a framework (Baum, 2015).
Try direct response marketing. The goal here is to get an immediate response from a consumer to generate new leads- by that consumer visiting a website, making a purchase, or sharing a post on social media. You can create a sense of urgency around an offer that encourages your target market to act by using deadlines or limited stock supplies (Wetzler, 2021). It does not always have to be about sales- contests and giveaways can be used for consumers to engage with your brand- delivered through email or social media. Do not neglect traditional advertising either (local radio, TV, flyers, ads). The U.S. Small Business Administration recommends spending around 7-8% of gross revenue for marketing/advertising if you have less than $5 million yearly in sales and your net profit, after expenses, is 10-12% (Schwinum, 2021).
Build partnerships- by nurturing relationships with customers or other complimentary business owners. Do not waste a good lead by forgetting to follow up after that sample you sent, or that good conversation you have.
To summarize, plan and research your business as much as you can- then launch! Mistakes may be made, but learn from them. Let your passion lead you to your business success.
