Starting your own business is an incredible way to make yourself happy. You get to choose what hours you work, you control your income, and you’re not obligated to third party services like employers are. Plus, there are many ways to run a business that do not require too much investment or expertise.
There are several types of businesses for almost anyone to start. Your best bet will depend on your personal goals, strengths, and interests. It can be something simple like offering freelance writing services via Craigslist or Amazon or more complicated like running your own food truck or owning a dog shelter.
Given how easy it is to launch a business these days, most people don’t know what keeps them from doing it. This article will go into detail about some common reasons why starting a business isn’t quite as easy as everyone makes it out to be.
Create a business plan
Now that you have your initial idea, it is time to start developing a more in-depth business plan. You will want to do this before getting too far into the process of starting your company!
A business plan is an extensive document that covers all aspects of your business including: what services your business offers, how much money you expect to make, who your target audience is, and the marketing strategies you will use to promote your business.
It is very important to be thorough with your business plan because there are going to be investors looking at your business plan to determine if investing in your company is worth their money.
General tips for writing a business plan: Use standard word processing software such as Microsoft Word or Google Docs to create yours. These tools can easily be modified and edited later so that you can add new components to your plan.
Use bullet points and paragraphs to organize your business plan. Try to focus on only one main topic per bullet point and then subtopic under that.
Fund your business
Before you begin looking for businesses to purchase, or start-up services to use as a foundation, you will need to make sure you have enough money to fund your small business.
It is very important that you know what kind of budget you have before buying any businesses, so that you do not overspend. Many people start their search with an empty wallet, which can be disastrous when investing in more expensive businesses and things such as running costs. Make sure your finances are in order first!
There are many ways to source extra cash to invest in your small business. These could include: selling other belongings, asking family members for help, taking out loans, etc.
Remember, don’t spend all your savings on business investments! Only invest what you have set aside for your own personal life – we’ve seen it done too often before.
Pick your business location
Finding a good place to do business is an important first step in starting your small business! Before you start looking for space, make sure you have all of the resources needed to run a successful business. This includes having a source of income, a mailing address, phone service, internet access, and more.
Once you have these things, search for available spaces that can be used for your business. These could include renting or buying a building, leasing commercial real estate, or owning a part-time business such as a coffee shop or restaurant.
It’s best to find a space with adequate parking so people don’t need to walk outside to get somewhere after work. Also, look into whether the area has enough foot traffic to help promote business for yours.
There are many ways to approach this research. Some companies offer free business information through their organization or referral program, so why not take advantage of it? You should also check out online businesses around you to see what kind of success they had and what services they offered.
Choose a business structure
Choosing your business structure is an important decision, one that will have a lasting effect on your small business. You can choose from three main types of businesses: sole proprietorship, partnership, or corporation.
Sole proprietorships are typically run by just you – the owner/operator. This is the most common type of business for individuals due to its simplicity.
You hold yourself out as being the provider of the service or product, and people trust you because you’re personally involved in what you provide.
That said, it can also be difficult to coordinate time off when you’re working alone, so it’s better to get into a team mode if you want to take breaks.
Partnerships are similar to owning a business solo except you’ll need to find someone with whom to share ownership of the company.
This could be a friend who’s willing to put their name on the paperwork, or someone else with creative talent that you can recruit to help you grow your business.
A good way to know if this is a viable option is to ask yourself whether you would feel comfortable having friends or family members own a part of your business.
Corporations offer more formal structures than partnerships and individual owners, but they don’t allow you to easily hire additional staff or expand beyond your initial investment.
Choose your business name
This is one of the most important steps in starting your small business! Before you can begin offering your services, you will need to pick out what business you want to go into. Try thinking about what area of the market you would like to target and then find ways to make that service or product unique so people know who you are and what you offer.
You do not have to use your family name as your business name, but it helps if you can be easily identified under your own identity. Take your time to think about which names feel natural and strong for your business.
Keep generic terms such as “Business Consulting” or “Public Relations” too close to businesses that already exist and could pose a challenge for recognition. An easy way to get rid of this problem is to create a business website using either a free web hosting site or a paid site such as WordPress.com.
Register your business
The next step in starting your small business is registering with both state and federal governments as well as your local government. This process typically includes opening an account at a bank, completing forms, and putting up some signage or advertisements.
Some of these services can be paid through monthly subscriptions, which help cover overhead costs such as phone bills, advertising, and website development.
There are many ways to register your business, so do not feel like you have to use one method over the other. Some people prefer using mail-based systems because it does not require someone else’s service, but there are plenty out there that offer free tools to get started.
Get federal and state tax IDs
Starting your business requires you to identify yourself as an individual or company. This is typically done through having a social security number, a business name, and either a State Tax ID or Employer Identification Number (EIN) from the IRS.
Having these three pieces of information makes it easy for others to do business with you by using your legal identity. For example, when people log in to their own accounts at Amazon, Facebook, or Netflix, they use their personal identification numbers (social security numbers, etc.) so that their account can access those services.
By having this same kind of identification for your business, people will know who you are and what rights they have to do business with you. They’ll also be able to verify that you exist by looking up your Tax ID, EIN, or both.
There are two ways to get your business Tax IDs. You can apply directly with the government agencies that handle taxes, or you can hire someone to help you do it on your behalf. Either way, there are free resources available online and in books and magazines.
Apply for licenses and permits
Before you start your business, you have to make sure that you’ve got all of your legal ducks in a row. You will need to apply for various licenses and permits as well as sign agreements with suppliers and customers.
Some of these can be done online while others may require going into a government office or meeting with someone directly. It is best to do this as early as possible since the longer you wait the more chance there is of something getting in the way.
When buying products from outside vendors, proof of payment and delivery needs to be verified too! Getting these things in place ahead of time helps prevent any headaches later.