You’ve decided on your ground-breaking business idea and you are more than eager to start your new business. But are you truly ready to do what it takes to succeed as an entrepreneur?
Here’s a look at common foundational steps you need to take to prepare for an effective business launch.
The business idea
Start with a clear and definitive understanding of your business idea. Why do you want to start a business? What is the purpose? How will you evaluate success? What value does your business provide to you, your ideal customers, community and the world?
Your business idea should be something that you are passionate about. It can be as simple as offering beauty services that is promoted on Gumtree, to establishing a healthy vending machine business or as technical as creating a new marketing software platform.
It’s also important to have a solid understanding of the offering. How does it differentiate from competitors? This can be in the form of location and proximity advantages, a feature of the product or service, or perhaps a niche market.
Consider your ideal customers and the size of the market opportunity. Conduct research around the context of your idea. Are there similar businesses and if so how can you improve the business model?
The business plan
Once you have decided on a product or service you wish to provide, create a business plan to evaluate its viability. This will give you a good understanding of what is truly needed to launch.
There’s debate on the type of plan you’ll need, but as Benjamin Franklin once said: “If you fail to plan, you are planning to fail!” So do yourself a favor and define your goals upfront along with a plan to achieve them. You can formulate your business plan by using a pre-existing business plan template as a guide.
Legal requirements to set up your business
It’s important to understand the legal requirements before you launch your small business. For example, you’ll want to register your business name, get basic information of Federal, State and Local tax laws, obtain business permits and licenses if applicable. It’s also wise to conduct a risk assessment, obtain business insurance (if necessary) and register any intellectual property.
Business finance and accounting
When you start a business, you will need startup capital to cover startup costs and operating expenses. You can finance your startup through personal investment, family and friends, business loans, venture capital (not suitable for all types of businesses), or crowdfunding. Platforms like Patreon– a membership platform that provides business tools for creators to run a subscription content service–or Kickstarter make it easy for founders to raise funding for their projects by tapping into the power of the crowd.
If you aren’t proficient in accounting take time to learn the basics including cash flow management. As your business grows you may want to hire a bookkeeper or an accountant. This will be useful when tax season rolls around as well.
Passion is important, but it takes a lot more than loving what you do to launch a sustainable business. Consider why you want to become an entrepreneur in the first place. Be prepared to work hard and smart.
Jock Purtle is the founder of Digital Exits, an online brokerage service. Jock has been featured in Forbes and contributed to numerous websites and podcasts. He specializes in appraising, buying and selling online businesses and enjoys helping other entrepreneurs do business online.
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