Starting your own small business is a dream that many pursue. The idea of calling the shots and owning something all by yourself is greatly appealing, but getting there is more difficult than you might think. Starting a business is a complicated process. It takes more than a great idea and an entrepreneurial spirit to be your own boss. Fortunately for you, we’re here to help make your dream a reality. Here are the first steps to starting your own business.
Create Your Business Plan
The first thing that you need to start your own business is create a business plan. A solid business plan helps you organize your ideas, realize your vision, and attract potential lenders and investors. Your business plan doesn’t need to be overly complicated. A concise business plan is much easier to read and will be a more effective representation of your business. Ideally, your business plan should include these key elements.
Your Mission Statement and Vision
This is where you want to put down your business ideals. Why are you starting this business? How do you want your business to be run, and what principles will govern how you conduct business? What are your ideal business goals?
Running a business means you will be catering to a target market. Understanding this market is crucial to making decisions around your business. Do your research and figure out how your target market will support your business. Consider what competition you might face, and if anyone else has tried your approach in the same area.
Estimated Expenses and Financing Needs
It’s easy to imagine the profit that a business can make, but it’s more difficult to come to terms with the reality of business expenses. No matter what kind of business you are planning on running, business expenses are an inevitability. Estimating these expenses helps you figure out how much financing you’ll need for your business, and how much it will cost to keep it going month over month.
Organization and Management Structure
This part is very easy if you are running a business all by yourself. But if you have dreams of expanding your business, or are already planning a larger business, you’ll want to create an outline of the business structure here. Designing a hierarchy gives you a visualization of how people in your company might relate to one another.
Find a Mentor
Starting a business for the first time is a scary process. It can help to have a mentor there to guide you through your business plan. A small-business consultant can sit down with you and coach you through the processes that you are unfamiliar with. Additionally, they can help you plan out your actions and guide you through creating objectives.
You can find business mentors by searching online or asking around locally. There’s a good chance that the business owners that you know can connect you to a trusted business consultant that they use or have used in the past. If you’re running on a tight budget, there are also many free and low-cost options. SCORE, sponsored by the U.S. Small Business Administration, offers business counseling. The SBA also has a wealth of free online training tools to prepare you for starting a business. You can also check out our library of articles for some free business advice.
Your business’s structure will affect your liabilities, both personal and tax related, so it’s important to devote time to researching your options. Your business will likely fit one of these four categories:
- Sole proprietorship.
- Limited liability company, or LLC.
- C corporation.
- S corporation.
You can learn more about the different kinds of businesses on mass.gov.
Ask your mentor for help choosing what type of business you should apply for, and for help navigating the bureaucratic process. Once you’ve settled on what kind of business you would like to be, your next steps are to register your business and apply for a tax ID number.
Organize your business finances
Your business’ finances should be separate from your personal ones. Start by opening a business checking account (link), setting a budget, and determining how you will pay for startup costs. As you begin to develop your business further, you will likely want to open a business credit and explore some payroll and cash management tools. You can meet with a cash management expert to determine what tools your business should be utilizing. And if you end up needing a loan, connecting with a commercial lender is easy.
Build your team
Unless you’re a one-person operation, you’ll need to recruit the right people to help your business flourish. This is a great time to reference the business plan that you created earlier. Start networking in-person and online to connect with potential employees and consultants. Websites like LinkedIn and Indeed are great for posting available jobs.
Register for Permits and Licenses
Apply for any required permits and licenses as well as workers compensation insurance, if applicable. Taking care of these details now could help you avoid hefty fines later.
Marketing and Online Presence
Your business can only succeed if people know about it, so creating a strong marketing presence is a must. Start by creating a website and some social media accounts for your business. These will help establish your presence online and give customers a place to research what you offer. Your website might be barebones when you first begin, but you can work on establishing some stronger roots while you go. Start by learning the five best ways to grow your business using social media.
Build a website
The good news is that you don’t need to be a computer programmer to build a website. Programs like WordPress and Squarespace have easy-to-use templates and tools to help you create your website. And if that isn’t something you’re interested in, you can always hire a website designer to build one for you. It’s more expensive to hire someone to do the work, but the quality is a worthwhile investment. And when something on your website inevitably breaks then you have someone you can call to help you fix it.
It takes work and planning to start a new business, but the rewards of pursuing your passion can be well worth the effort. Small businesses are an essential part of our economy, and while they may be difficult in the beginning, they can also be an incredibly exciting adventure.
Here at Main Street Bank, we want to make it as easy as possible for anyone to start a small business. We provide the banking support that is essential for a beginning entrepreneur. Come book a free consultation with one of our experts today. Using Video Connect, you can be connected to a real banking professional from your home or office. Book a consultation with a banker today.