Although a budding entrepreneur’s to-do list may seem endless, that shouldn’t stop you from launching your own small business. By breaking down the individual components of starting a company, you’ll find that the process isn’t as overwhelming as you initially suspected. Here’s what to keep in mind before getting started.
Create a business plan
First things first: Come up with a strong business plan. Your ideas will have a much better chance of coming to fruition if you put them down on paper. This document, typically no longer than one page, should describe your company’s goals and provide a clear roadmap highlighting how you’ll achieve those objectives. As well as explaining your mission to potential investors, a business plan can help you better understand your own company.
Find funding
Speaking of investors, you may want to consider securing outside funding to help your company get off the ground. While plenty of successful companies are bootstrapped, know that you’ll have several sources of funding to choose from, including venture capital firms and small business loans from banks or credit unions. Peer-to-peer lending is also gaining steam, especially among businesses that have some sort of social cause. Make sure to figure out how much money you’d need as well as how that cash would be used.
Select a business structure
Before deciding how you want to structure your company, take the time to learn about your various options. This step is crucial, as it will determine which taxes you’ll end up owing. There are important differences between a sole proprietorship and a limited liability company (LLC), for example. It’s up to you to determine which arrangement will work best for your business.
Know your tax responsibilities
To paraphrase Benjamin Franklin, nothing is certain but death and taxes. This sentiment certainly holds true for small business owners. Finding out exactly which taxes you owe will depend on what type of business you operate and where it’s located. If you owe federal taxes, you’ll need to apply for a tax ID.
Take care of permits and licenses
If you’re planning on opening a bar, you’ll need to apply for a liquor license. Stores that sell firearms will also need certain licenses and permits. The fees for operating your business without the proper documentation can be stiff, so be sure to double-check whether this applies to your company.
Spread the word
Once you’ve taken care of the necessary paperwork, shift your attention toward building a strong marketing campaign. You’ll want to zero in on creating a strong website that can help drive business at a time when your brand is still relatively unknown. Your job is to highlight how your company is different (read: better) than the status quo. What do you offer that competitors don’t? Using social media is a cheap yet effective way to answer those questions, which will quickly broaden your audience.
Find and retain talent
Along with securing new customers, a strong marketing campaign will also attract top-tier talent. As your company expands, so too will your need to bring more people aboard. Because your first few employees are so instrumental in establishing your company’s culture, you’ll want to be meticulous about hiring the right people.
Final thoughts
Opening a small business is like assembling a piece of furniture. From tax forms to funding, everything you need is out there, and it’s your job to use the right tools to make all the pieces fit together. Approaching the building process one step at a time will result in a sturdier and more durable business.
Image of small business owners via Shutterstock.
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