It may be a dream you have had for years. It may be something you woke up thinking about this morning. It could be somewhere in between. You’ve now begun the process of starting your own business and if successful, being in charge of your own economic destiny.
But it takes more than a dream. Starting a business takes time, effort, help.
Your Startup Business Process begins with establishing a variety of processes and actions that help you create a sustainable growing and profitable business. It is important to understand some key points regarding a startup business. These are:
- Most businesses are not profitable in their first year. Some aren’t profitable until their third year.
- Some business owners cannot pay themselves in their first year. Others can, but the wages are small.
- Cash is King. Do you or will you have sufficient cash to pay your bills including any employees you may hire?
After you understand and know how you will manage those points you can begin creating your business. Generally, you will start with your business structure. Your structure will involve:
Legal and Accounting issues –
- What legal structure will you operate under? Will you be an LLC, an Inc, or some other legal entity?
- You will need a separate business bank account. At a minimum that means a business checking account. Do not make the mistake of using your personal checking account for your business.
- Who will be your accountant or bookkeeper? Or, if doing this yourself, are you knowledgeable enough to know and use basic Accounting principles?
- Establish a Business Plan. You don’t need a detailed plan but at the very least you should have some written document outlining what your business will do and how it will do it. This also involves creating a Business Vision and Mission statement.
- Developing a Business Budget. Before you make your first dollar you need a budget. Some financial plan for how you project revenue, expenses and any profit. Tracking how the money will flow through your business is critical to your success. My clients create a simple 12-month balanced budget that provides them with a budget structure regardless of their level of sales or revenue.
Providing Your Product or Service –
- Know what your product or service will cost you to deliver. This is necessary for you to determine if you can make a profit doing what you want to do. If you can’t, this process can be reviewed and refined to become profitable.
- Know what you will sell your product for – can you add value and charge more? Can you improve your product, charge more for it, and increase both your revenues and profitability? Conversely, what can you remove from your product or service, charge less for, and appeal to other buyers?
- Understand the assets needed to develop your new business. This can be people, equipment, money, supplies, home office, shop, storefront and so forth.
Develop a Marketing and Sales Strategy –
- Not how you will advertise but where your product or services will add value. What groups, as opposed to individual customers, will you market to. For example, Schools, Hospitals, Car Dealerships, Stores, homeowners, etc. If you know your market you will know how to find customers.
- Determine how you will sell your product or services. How will you present your product or service features, advantages, and benefits? How long do you believe your sales process (cycle) will take? Can you effectively meet your prospective customer’s needs, wants or desires while creating a relationship where they like you, trust you and respect you?
While going through those steps you may realize that you need help. That isn’t a weakness. In fact, seeking help is a sign of maturity and intelligence. We don’t all know everything and many startup businesses are established by experts in a particular field or trade who, while very good at what they do, don’t have the business skills to successfully launch and maintain a business.
There are several options for this. Sometimes, you may need or want more customized help that offers you specific tools or educational services for your business. This could be for reasons of the nature of your business to you simply want personal help. A professionally certified business coach/consultant skilled in small startup businesses is usually an ideal choice for this type of effort. You can seek assistance from a local University or Technical School. For those with common business issues or where unique solutions are not needed, this may be an option. Some communities have free business mentoring programs through volunteers. Exercise caution here as not all volunteers are created equal and you may find the mantra, “you get what you pay for” to be quite accurate.
Regardless of your needs, starting a business takes planning. Without planning your experience could be one of confusion or even disaster. Plan your work and work your plan for success.
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