Starting a business is a challenging thing for some people, and not everyone knows where to begin. Once you’ve decided to start a business, it’s important that you have clear expectations for the future, otherwise it can quickly become scary and overwhelming.
Planning, conducting market research, and making important financial decisions are just some of the main activities you can do as an entrepreneur. There is no one size fits all approach to starting a business, but there are steps to help you outline your goals, develop a plan, and ultimately launch a successful business.
This is a simple guide for you through every step of the process for starting a business, from determining a business idea to registering, launching, and growing your business.
- Examine Your Business Ideas
A “good business idea” is an idea that you are able to implement, serves a market, and has the potential to generate large profits.
Princeton Creative Research has a helpful list of questions that can help you evaluate your business idea, namely:
– How simple or complex is the idea execution?
– What specific problem or difficulty is the business hoping to solve?
– Can customers purchase it? Will they buy it?
– Are projected profits adequate?
– What are your competitors doing in this area? Could you be competitive?
- Business products or services
Your business will provide people with a product or service. Product businesses raise the price of the product and then profit from the difference, while service businesses (such as law firms or consultants) sell time and expertise.
Decide which type of business best matches your skills and goals. - Market research
Your big idea may work, but you have to be sure that its potential is real. You need facts. This is where market research plays a role.
Market research is the technical name for the simple process of collecting feedback and data to help you understand the viability of your plan. Is there a market for what you wish to do? - Competitive Analysis
Although market research informs you about the general conditions for starting a business. Competitive analysis helps determine whether your new business can compete with existing, similar businesses.
Of course there is lots of competition. According to the SBA’s 2023 Small Business Profile report, there are 33.3 million small businesses in the United States, accounting for 99.9% of all U.S. Businesses. And if you want to sell products or services online, there’s a global marketplace to consider.
Search your local Google and Yelp listings to see other businesses that provide similar products and services to the ones you want to offer.
Find opportunities
Translate what you see into ways your new business can meet customers’ unmet needs.
Is a local competitor the only business of its kind and as a result charges extremely high rates?
Can you create branding that provides a more aesthetically pleasing experience?
2. Create Your Business Plan
A business plan is a dynamic document that serves as a roadmap for setting up a new business. This document makes it easy for potential investors, financial institutions, and company management to understand. Even if you intend to finance your business yourself, a business plan can help you put your idea into action and spot potential problems. When writing a thorough business plan, include the following parts:
- Company Description
The company description covers the problem your product or service solves, and why your business or idea is the best. For example, perhaps your background is in molecular engineering, and you’ve used that background to create a new type of athletic wear — you have the right qualifications to make the best materials. - Executive Summary
The executive summary should be the first item in the business plan, but should be written last. It describes the proposed new business and highlights the company’s objectives and methods to achieve them. - Organization and structure
Write about the type of business organization you expect, what risk management strategy you are proposing and who will staff the management team. What are their qualifications? Will your business be a single member limited liability company (LLC) or corporation? - Market analysis
This section of the business plan analyzes how well the company is positioned relative to its competitors. Market analysis should include target market, segmentation analysis, market size, growth rate, trends and assessment of the competitive environment. - Mission and goals
This section should contain a short mission statement and detail what the business wants to achieve and the steps to achieve it. These goals should be SMART (specific, measurable, action-oriented, realistic and time-bound). - Products or services
This section describes how your business will operate. This includes what products you will offer to consumers at the start of the business, how they compare to existing competitors, how much your products will cost, who will be responsible for creating the products, how you will source raw materials and how much it will cost to make. - Marketing plan
The marketing plan identifies the characteristics of your product or service, summarizes a SWOT analysis and analyzes competitors. This section also discusses how you will promote your business, how much money you will spend on marketing, and how long the campaign is expected to last. - Financial plan
A financial plan is probably the core of a business plan because without money, the business will not run. Include a budget proposal in your financial plan along with projected financial statements, such as an income statement, balance sheet, and cash flow statement. Typically, a five-year financial statement projection is acceptable. This section is also where you should include your request for funding if you are seeking outside funding.
3. Market Your Business
Many business owners spend so much money creating their products that there is no marketing budget by the time the product is launched. Alternatively, they’ve spent so much time developing the product that marketing is an afterthought.
- Create a Website
Even though your business is physical, having a website is now very important. Creating a website doesn’t take long either — you can finish it in just a weekend. You can create a standard information site or an e-commerce site where you sell your products online. If you sell products or services offline, include a page on your site where customers can find your location and business hours. Other pages that can be added include an “About Us” page, product or service pages, frequently asked questions (FAQs), blogs, and contact information. - Optimize Your Website with SEO
Once you’ve got a website or e-commerce store, focus on optimizing it for search engines (SEO). This way, when potential customers search for keywords specific to your product, search engines can direct them to your site. SEO is a long-term strategy, so don’t expect a lot of traffic from search engines in the beginning — even if you use all the right keywords. - Make Relevant Content
Provide quality digital content on your website that makes it easier for customers to find the right answers to their questions. Content marketing ideas include video, customer testimonials, blog posts and demos. Consider content marketing as one of the most important tasks on your daily to-do list. These are used in conjunction with posts on social media. - Get Listed in Online Directories
Customers use online directories like Yelp, Google My Business and Facebook to find local businesses. Some city halls and chambers of commerce also have business directories. Get your business included in as many relevant directories as possible. You can also create your business listing in specific directories that focus on your industry. - Develop a Social Media Strategy
Your potential customers use social media every day — you should be there too. Post interesting and relevant content to your audience. Use social media to drive traffic back to your website so customers can learn more about what you do and buy your products or services. You don’t need to use all available social media platforms. However, you need to be present on Facebook and Instagram because they offer e-commerce features that allow you to sell directly from your social media accounts. Both of these platforms have free ad training to help you market your business.