Starting your business is definitely a fun way to make yourself some extra money, or even a full time income! Before you dive in, however, you should do some research and prepare for everything – from creating your business model to finding an area of the market that needs help to running your company.
In this article, we will talk about how to get started with a business idea, what types of businesses have succeeded, and how to pick the best option for you!
Business ideas come in all shapes and sizes, so don’t feel like you need to be working in a big corporation to launch your own empire. Many small business owners start their careers out as employees before moving onto owning their own companies.
A good starting point is looking into making your current job easier or bettering the workplace environment through the implementation of new technology or practices. Or maybe you can create a service or product that other people are missing or paying too much for.
Develop your business plan
Before you actually launch your business, you will need to have a solid business plan. This is an essential piece of preparation that should be done well in advance.
A business plan can help you get started, keep you motivated during the early stages, and provide you with needed inspiration and guidance as your business grows.
It’s not necessary to have a beautifully written, highly detailed business plan, but it does require enough detail to prove that you’ve thought about what kind of business owner you want to become and how to make it succeed.
You don’t have to do this yourself, there are many great freelancer and small business service providers out there who can help you create and edit your business plan.
Fund your business
Before you even begin looking into how to start a business, you need to make sure that you have enough money to fund it. It is very unfortunate to start investing in equipment or marketing strategies only to find out that you do not have enough money to fully finance your business!
If you want to be successful, you will need to know when to stop trying new things and instead focus on what has worked for other businesses like yourself. Starting a business requires lots of resources so make sure that you have all the funds necessary before diving in.
There are many ways to get started with no cost or low-cost alternatives to more expensive modes of funding. Many people start their own business by selling products from their house or creating online stores using free website services.
Pick your business location
Choosing your business location is an integral part of starting your business! While it may seem like a simple process, it can be tricky deciding where you want to open up shop.
Thinking about this ahead of time will help you streamline the process once you’ve got the initial investment made. For example, if you wanted to start a yoga studio, choosing a place with good transportation would be important so that people can get to your class easily.
If you already have a source of income, you can use that as leverage to pay for some of the costs associated with opening a business — such as rent or buying supplies.
By investing in things such as a private email account, website hosting, and professional looking business cards and receipts, you can bolster your image while establishing yourself as an expert in your field.
Choose a business structure
Before you can start running your business, you have to determine what kind of business entity you will use. This is one of the most important things to do as starting a business can cost anywhere from nothing to lots of money!
You will need to consider three different types of entities when establishing an organization that will own or run your business: sole proprietorship, partnership, and corporation.
A _solo professional_ (also called a l individual) owns and runs his/her business alone. They are usually taxed directly as individuals rather than through partnerships or corporations, which may be organized as an S corp (for small businesses), C corp (for companies), or LLC (for limited liability).
Businesses such as restaurants must be operated as corporations because of how much regulation there is in the serving food industry. Corporations are also more tax efficient due to the way income is allocated into personal taxes versus corporate ones.
For both solo professionals and corporations, additional paperwork and legal fees are involved with incorporating.
Choose your business name
Now that you have an idea for a business, it is time to pick a name! This will be your company’s brand so make sure you choose something you can live with and grow into.
It is very important to use descriptive words in your business’s name. Make sure your potential customers can easily find your product or service through a search engine. Try going online and doing some research to see if your proposed business name is already taken by another company.
Also make sure your chosen business name doesn’t violate any laws and don’t include anything too politically charged or sensitive.
Register your business
The next step in starting your business is registering it with the state or country as well as doing so as an individual, not as a company. This includes creating a business name, filing necessary documents, and verifying you are legal to run this business!
Business owners often get stuck here because they think of all the things they need to do for their business as an owner, but none of them make sense as a person who owns a business.
Running a business means hiring employees, marketing, buying supplies, paying bills, etc., so unless you’re willing to hire others to help you run your business, you can’t start working on any other area yet.
And don’t worry about being too fancy when naming your business! Most people use either just their last name or some sort of acronym (like KIYDS – Keep It Young, Dependable). A good rule of thumb is if you would say it out loud, then put that into your business name. For example, if your given name is Jennifer, then your business name could be “Jenny’s Reusable Sanitary Products.
Get federal and state tax IDs
Starting your business requires you to have some sort of formal identification. This includes getting both your business licenses and employee badges, as well as having valid health coverage for yourself and your employees.
Business license requirements vary by location and city, so make sure to check out what is required in yours before starting! The licensing process can be quite expensive depending on the type of business, so do not spend money unless you are certain that you will need one.
It’s also important to know whether it’s mandatory to have these documents on file, or if you can get an exemption from doing so.
Apply for licenses and permits
Before you can start running your business, you need to make sure that you have all of your licensing and permit paperwork in order. This includes buying or renting the place where you will do your business, obtaining permission from nearby businesses to operate there, and proving ownership of the business as well as proof of insurance.
It’s also important to check out how much “doing business as (BAA)” liability coverage an individual policy has before you go into business under that name. Many states require one year of coverage per person, which is why it’s best to be prepared by purchasing a secondary policy in that case- otherwise you could lose your home!
Getting these things in order is not very difficult, but it does take time so don’t rush through it unless you really want to see what happens when people are not properly licensed.