It is obvious you want to learn how to start your own business, but you have no idea what your first step should be.
Many people are doing their best to start a business however small. Here we are today where securing a job, no matter the type, is no longer a safer option since salaries are getting worse and competition in the public sector is very keen. It is obvious many people are fixated on the fact that some very few salaried workers earn quite a decent amount of money at the end of the month. They, however, lose sight of the financial freedom guaranteed by successful entrepreneurship.
Determination and having a sense of opportunity are just two (2) of the many characteristics every successful entrepreneur possess. For a complete list of all the 21 characteristics, read this post.
The bigger problem is when you are determined to establish your own business, with all the illusion in the world and you are even willing to work 12 hours a day if necessary. And in the end, you don’t seem to have a headway.
This is one of the common frustrations most start-ups go through.
But you do really know anything about starting a business?
Are you contemplating whether to start an online business or a physical business? Do you have a difficulty with what to sell or what services to offer? Do you have any idea if you will need a huge capital or something reasonable to start with? It could even be how to attract clients and promote your business to increase your profits.
If these are your main objectives, then you are very fortunate. I am going to show you the right steps you should take to start a business. It is important to know what kind of entrepreneurship is best for you. How to get financing, how to register your business and of course how to create a marketing plan to have a good customer base.
What You Need To Know Before Starting A Business
Starting any enterprise isn’t going to be an easy one since it requires a lot of time, effort, and hard work. Most aspiring entrepreneurs are not able to complete this journey successfully. So if your business survives the various hurdles along the way, then congratulations.
Before you launch your business, there is a lot to plan and consider, and it is very important to prepare yourself adequately for entrepreneurship. But if you think you are ready to start your first business, then you have to consider the following:
1. Think About What Your Business Will Be
This is very clear. If you want to start a business, you must have an idea of what your business is going to be. However, many people have a clear intention of what their business is about, but they do not know what to do.
I can not tell you what your ideal business will be even if you tell me what things you are passionate about or have a good knowledge of. That is a decision exclusive to you.
But what I can do is to give you some tips to clarify your ideas.
To create a successful business, you must consider these three (3) essential factors:
- What you are passionate about
- What you know or the skills you already have
- Do people have an interest in what you want to offer?
And yes, you have to be sure whether or not the businesses you are thinking about makes you excited.
But How do you know that?
If you can be working on your business for most of the day (at least 12 hours) working, thinking, and breathing your business without getting bored, then you are halfway through the journey. Can you remain focused irrespective of the failures that hit you along the way? If yes, then you are a candidate of success.
You can choose to establish a catering service because that is what you are more passionate about. But if you do not know how to do it, or if people are not interested in your style of doing it, then it will collapse.
You may be thinking of selling templates for blogs and web designs because you know how to do it and it’s a business most people are making money from. But if you do not like it that much, or you have little interest in that, you will not put in your best. This will go a long way to affect the quality of your service leading to low patronage.
So think well on those three (3) factors and make a list to decide on one business or another.
It is, therefore, necessary to identify what your interests are and also your abilities in order to produce something that people will be interested in and are willing to patronize. And on top of that, you have to find out if there is a market that is willing to buy what you sell.
After you have incorporated these factors in your business, then it is time to plan your business.
2. Prepare Your Business Plan
I should believe you already know what business you are going to establish. Before you start to go crazy looking for how to attract customers or where to get the money you need. It is imperative that you prepare a business plan.
Although the name may seem a bit complicated to elaborate. Do not worry. It is not as difficult as you may think. It is very useful both to take the bold step to start your own business, and also to solve people’s problems once you open your doors to your customers.
Who Is The Business Plan Meant For?
The first person to be interested in the business plan should be you the entrepreneur. It is you who have an objective or a vision to pursue. You have analyzed and planned your project. You’ve got to know it better as you have identified its strengths and weaknesses. Developing a keen interest in the business plan increases your chances of success. It will also help you in planning the necessary tasks.
The next category of individuals who should be interested in the business plan is financial institutions, private investors, suppliers, etc. The business plan serves as a “Business card” for the entrepreneur. This is particularly important when applying for grants, loans, subsidies, etc. if you so wish.
Remember that a well-written and structured business plan is a very important tool to present your business idea to third parties, especially investors, banks, and institutions who may be interested in your business.
It must be clear and concise so that another person can easily understand it. And it must also be convincing, since it may depend on whether or not to obtain the necessary financial muscles if the need arises.
The business plan should fulfill the following functions:
- Identify, describe and specify in detail the business idea.
- Examine its technical feasibility (can it be done?), Commercial intent (is it going to sell?), and financial prudence (will it be profitable?).
- Plan the strategies to follow, the steps to take, and the resources to use to convert that business idea into a functioning company.
The length of your business plan doesn’t matter. The most important thing is that your business plan answers the following fundamental questions:
- What will be your business
- What will your business offer (products, services, etc.)
- Who will your customers be (men, women, how old are they, what are their interests, how much do they earn?)
- How are you going to get to your potential customers (social networks, advertising in magazines, email)
- Who are your competitors and how can you differentiate yourself from them.
- Where are you going to start your business (Online business, or a physical business)
- What equipment, materials, and expenses will you need (In order to create a budget for the required capital)
- How will you finance your project if you need money (investors, your savings, and your family)
- What risks are there?
When you are satisfied your business plan answers most, if not all the above questions, then you are good to go.
3. Financing Your Business
To get your business going, no matter what line of entrepreneurship you find yourself pursuing, you will need startup capital.
You may be wondering, at this moment, why the need for startup capital. To make it pretty clear for you, I have outlined some typical startup cost that new business owners will be confronted with.
They include the following:
- Electronic equipment
- Legal fees
- Advertising: Pay-per-click or Affiliate marketing
- Office supplies
The list is just endless.
Other strategies can be employed to cut down your startup cost as an entrepreneur. For example, you can use your cell phone or personal car instead of buying a new one especially when you are financially handicapped.
Some people even use a room in their home as an office, warehouse, or something just to keep their business going.
Here are some ways to finance your business
You can use your own personal savings to pay for your startup cost. This way, you won’t incur any cost regarding interest. This is one of the safest means of financing your business since no one will come after you if your business collapse.
It is easier nowadays to secure a business loan to finance your startup business. However, applying for a business loan requires a process that you have to prepare adequately for before you can secure it. You cannot just jump unto any loan manager and expect to be given any funding you need. That is why having a convincing business plan is a good step in winning the attention of investors.
The P2P lending has now become a new yet popular means of getting money to finance your business. This is the practice of lending money to businesses or individuals by matching lenders to borrowers. This is relatively cheaper than the loans offered by the traditional financial institutions.
This is a means of raising fund online by getting small amounts of money from a large number of people. For most entrepreneurs, this is a gray area.
Secure Small Business Administration (SBA) loan
Simply put, an SBA loan is a small business loan that is partially guaranteed by the government. Because the government is involved, this eliminates some of the financial risks posed to the financial institutions which are issuing the loans.
Get help from family and friends
When you are stuck with funds to support your startup business, your family and friends are the safest and easiest option to resort to. It doesn’t mean you should squeeze the hell out of your friends and family who are willing to help you raise funds.
By that I mean you should be sensitive to the limits your friends can afford to lose. You have to ask for a minimum amount you need to reach a significant milestone.
And now that you have secured the required funding for your business, it is time to focus on your customers.
4. Create Your Ideal Customer Profile
How would you feel if you knew everything about your customers? Thus if you knew their living situation, demographics, favorite colors, their budget range, etc.
You may think that your ideal client is anyone who comes to your business and spends USD 400 at a time. But when we talk about the profile of the ideal customer, we refer to the people who are interested in what you offer and are willing to buy them.
If you are going to sell dresses for women that cost USD 120 or more, it is more likely that a man is not your ideal customer. Moreover, a woman with a meager salary is equally not your ideal customer because she may not be able to buy.
That is why it is most important to identify your ideal customer by making your customer profile.
Ask the following questions about your customers:
- Who are they (men, women or children)
- How old are they?
- What are their interests?
- You need to know what they buy and where they buy them (online or in physical stores).
- What are their needs or problems?
- How do they obtain their products or services?
With these in mind, you can envision a person interested in your product. It also gives you a better understanding of what would motivate them to find your business.
According to experts, establishing your business or selling your products without proper understanding your ideal customer profile is like driving a vehicle with your eyes closed.
5. Choose A Location For Your Business
Once you know who your ideal customer is, and have obtained the necessary financing, you should choose the location for your business.
If you are certain that your customers tend to buy more over the Internet, this step will be very easy for you because you only have to buy a domain and a hosting to make your website and open your online business.
If your buyers are more traditional, that is, they like to go to a physical store to buy their products or services, then your company needs a physical location instead of the online business.
If you are going to set up a store, make sure that it is located in the right place and accessible to people interested in what you sell.
6. Find Suppliers If You Offer Products
If your business provides services or you are the one who creates your products, you can skip this step and go to the next point.
But if you are going to sell products that are not manufactured by you, it is important that you look for good suppliers who will give you the goods.
The first thing is to think about what you need from your supplier. Do you want your items to be of quality, but something more expensive? Or do you prefer a lower quality but with lower cost?
Once you have thought about this aspect, look for several suppliers with the features you have. You can start your search on the Internet, talking to other entrepreneurs in the same niche, or going to associations of merchants to see if they have supplier lists.
When you have found some suppliers, talk to ALL of them and select the ones that best suits you. Then try to negotiate the prices to see which one provides the best service with the cheapest price.
Remember that it is essential that you try their services by making a small order. If you like their services, you can go ahead and place more orders.
7. Register Your Business
At this point, before you start running your business, you will need to register it and apply for the necessary licenses and permits.
I can not tell you exactly what procedures you should do because this is different for each type of company and also for each country.
For example, if you want to open a bar or pub, apart from registering your business, you will also need licenses and permits to sell alcohol. While if you are going to set up a cell phone store this will not be necessary, but you may need to process other documentation.
So the best thing will be to go to your local authority or to the agency that corresponds to you and make inquiries on all the necessary information.
8. Develop A Marketing Plan To Attract Customers
This is the last step to start your business. Create a marketing plan to know what message to transmit and which channel to attract customers to your company.
For this, the customer profile you developed earlier in the previous section will also be very beneficial. With it, you will know where your clients go and what they are most interested in.
Your marketing plan should include the following:
What goals you want to achieve: It may be attracting customers, building loyalty, or increasing return on investment, etc.)
Which strategies are you going to use (advertising, social media publications, Affiliate marketing, discounts, organizing events, contests, etc.)
What method are you going to employ to put your plan into action (traditional advertising, digital marketing)
With these data, you must put your marketing plan into action to start making your business known and thus build your customer base.
For example, if you sell sportswear and your customers are men and women between the ages of 18 and 26 years old, who like to exercise and use Facebook and Twitter daily. The most prudent thing would be to promote yourself on Facebook and Twitter by publishing ads about sports, with images related to sports.
WHAT BUSINESS SHOULD YOU ESTABLISH?
There are hundreds if not thousands of new business ideas one can set up. The reality is that a business can be successful in one place, but that same business will fail woefully in another place. The seasonality is also a factor one has to take into consideration.
Some tips to find the business that suits you best are:
- The one that you are passionate about. If you already have experience in the field, it is always better. If you do not have knowledge in Administration, train yourself first (because you will need it later)
- Define a venture capital. That is, the money you are willing to LOSE in case the business fails.
- If you already have a location, identify if there are businesses around (this is a good sign).
- Do not worry about financial issues. Where there is a will, there is a way.
- Do not do illegal business (it may seem obvious, but it is not). Check out for all legal issues regarding the kind of business you want to establish. Some businesses may require a special permit.
Do things genuinely and never try to cheat the system. As has always been the case, common sense will always keep you out of trouble.
Starting a business may seem complicated; but if you go little by little, and step by step, and developing a proper business plan, it is easier than you think.
And best of all: once your project starts to work, if you have done everything right, the benefits it will bring will be an excellent reward for all your efforts.
And you, what kind of business would you like to start in 2019? Leave a comment below and tell me what you think.