Staring up any kind of small business is undoubted, a big undertaking. However, it is definitely not something that is impossible.
Anybody with a unique idea and good set of the workforce, backed by a considerable financial resource will be able to start any kind of small business with ease. Nevertheless, it is also a fact that not every small business is bound to succeed.
A recent study on the small business startups reveals that only two-thirds of these businesses with employees make it up to almost 2 years of tenure. If you are looking at the data for a five-year run, the numbers are even low with only half of them surviving until that period. These statistics will always make you twice before starting your own business.
So what is that magic ingredient that you should be adding into your plan while starting a business? How are you going to ensure that your business sustains the tuff competition and the unpredictable market conditions that are going to be thrown at you?
As we all know that the secret behind the strength and stability of a building lies in its foundation, this very same principle can be applied to the concept of starting your own business. So, we will be revealing you the seven magical steps, which if followed promptly, will create a stronger foundation for your small business and help it sustain in the market for a longer period of time:
Starting a business is somewhat similar to buying a car. You always need to carry out an extensive research before taking the first plunge. A proper due diligence in this aspect will define your position between success and failure.
The interesting fact is that it does not even cost much. There are various sources that will help you do the research. These include networking, informal focus groups, and various online references. You can even delegate it to agencies who are experts in carrying out such research works.
In order to convert your business idea into reality, it’s mandatory for a proper business plan to be in place.
A business plan is a strategy that will escort your business through the various stages of the business life cycle such as The start-up embryo stage, the establishment phase and growth and expansion once the business becomes stable.
It is also mandatory for you to choose the right business plan that suits your business model. For example, if you are having your own financial reserves that are going to be used in your business, you can implement the one-page business plan. If you are taking financial aid from angel investors; the traditional business plan is the best option.
The starting phase of your small business will involve many transactions. In addition, if these transactions are not monitored and controlled, the ROI will be way too less because of the initial setup costs incurred.
The best way to do this is by implementing an investment plan and allocating a specific cost limit to every field where the funds are being invested. This will give you an upper hand of control over the set-up expenditure and at the same time, help you maintain lower start-up costs by avoiding unwanted spends.
Your small business can be anything. It can be a partnership firm, a sole proprietorship or even a limited liability company. It all depends on what you want your business to be.
The type of business structure that you opt for your entity will play a major role in your liability, taxation and even the naming of your business. If you happen to choose a business structure that is different from the nature of your business, you always have the option to reevaluate and make a change to the structure as per the prevailing situation.
The name that you choose for your small business will be playing a pivotal role in almost all the aspects of your business. Therefore, it is extremely important for you to find a unique and catchy name for your business and gets it registered at the earliest so that no other firms can be started with the same name.
There are different ways to register your business. If your business is a sole proprietorship, it is mandatory for you to register your name with either the country or the state clerk. In case your small business falls under the limited liability or partnership model, you will have to get your business name registered at the time of filing of the formation paperwork.
The most important part while starting up of a business is Paperwork. You must be legally authorized to carry out the business activities. And for this to happen, you need to have the required licenses and permits to be in place.
The type of licenses and permits that you need to procure depends upon the nature of the business that you are doing.
You have an impressive business idea. You have obtained all the necessary permits and licenses for carrying out the business in your area. You also have a strong financial backup and your overall business plan is sorted out in with a fail-proof guarantee.
But, the question remains: Does the operation of such a highly organized business from a completely irrelevant location make it prosper in the coming years? The answer is a big no.
Setting up your place of business operations is very much significant for the overall functioning of your business. It can be a home office, a retail location or even a private or shared office space. You should always ensure that it is set up in a high location with high accessibility to your warehouse or the other areas that are related to your business.
Once you have followed these above-mentioned start-up steps you will have in front of you, an organized business with a strong foundation. Success does not come to you overnight. Once you have created a rigid foundation for your small business, you will have to follow the business plan to enhance your chances of success.