Starting a business right

The way a business starts can have an impact on its overall success or failure. It is important to be aware of this fact as an entrepreneur starting out. Within its infancy, a business is delicate and requires careful nurturing through good decision making and a solid routine to ensure its survival. Whilst businesses come in all shapes and sizes, there are general guidelines that can be followed when starting out to contribute to the success of the business. These points are not complete in their entirety but help an entrepreneur on their journey to make their business dream a reality. 

Check for demand

Find out how the market responds to your product or service. It is crucial to establish this before going full throttle on a business idea. Test your ideas using samples of your product and get feedback from the consumers. Also check if there is competition within that product niche and how the competition is faring with its products. This practice of researching what is going on in the marketplace is referred to as market intelligence. An entrepreneur with the drive to succeed will use market intelligence to forecast whether the product they are about to bring to the consumers has the potential to make money.

Write a business plan

A business plan is a document that details the inner workings of the business. This document is also used to secure funding from investors hence the detailed nature. Business plans map out the key areas of a business and can be used as a point of reference as you run your company to see if you are still on track. The document usually starts with an executive summary that defines the company, its vision and mission. The executive summary is a bird’s eye view of the entire company, its operations, location, employees and why it will succeed. After the executive summary follows the company description that explains the company in detail and the strengths that give it a competitive edge in the industry it wants to be part of. Market analysis follows the company description detailing the makeup of the market environment the business wants to enter into. Questions such as who are the target customers and what are the industry trends are addressed here. 

After market analysis is the organizational structure that details how the company is going to be run from a human capital perspective and who are the key people. The service offering or product line segment follows detailing what it is that the business wants to give the customer and the lifecycle of the product. The marketing strategy detailing how the business will penetrate the market and convert into sales follows. After the marketing strategy, a financial projections section follows detailing the hypothetical cash flows for a specific number of years from business launch. Finally the business plan document wraps up with an appendix that harbors supporting documents.

Capital sourcing

A business owner needs to identify sources of funding to start and run their business. They could consider approaching a bank for a loan that is repayable with interest. Some entrepreneurs may seek funding from friends and family to scale their business. The most common source of funding is from Venture Capitalists who are very keen to help startups with potential in exchange for a stake/ shareholding within the company. An entrepreneur can also choose to self-fund their business using their savings.

 Location

Where your business is zoned has an impact on your sales to a greater extent. For example, a shop selling food and fresh farm produce makes more money if it is built near a suburb or within town so that clients can easily access the products. Location is of paramount importance when starting out.

Register 

When you have made sense of the points above, it is now time to register your business under a good name and establish a brand. Depending on the nature of business trading, ensure that you have registered with the federal and or state government. 

Apply for Tax ID’s

Contact the Internal Revenue Service (IRS) and apply for tax id known as an Employer Identification Number(EIN). The Employer Identification Number will enable you to :

• Get a bank account
• Pay  taxes
• Apply for permits and licenses
• Hire Employees

Get Permits and licensing

To be compliant with laws and regulations, an entrepreneur should get the necessary permits and licenses that enable their business to operate smoothly.

Get a business bank account

Last but not least, a bank account for the business is crucial.  With an Employer Identification Number in place getting a bank account is easy.