It is no secret that these have been tough times for everyone. Yes, starting a business may sound daunting and expensive, but it need not be either. In fact, what it can also be is interesting and exciting, especially if you know what to expect and what you are doing.
Here's a good path to follow:
1. Plan ahead
You've got the inspiration. Do you really need a business plan?
Plenty of people argue yes. One is Sean Hackney, who co-founded Roaring Lion Energy Drink in Sun Valley, Calif., and grew it from a $62,000 investment to the No. 2 energy drink in bars and nightclubs. Hackney says writing a business plan was "absolutely" worthwhile: "I had a lot of stuff in my head that needed [to be] put on paper."
Entrepreneurship professor William B. Gartner of Clemson University in South Carolina analyzed data from the Panel Study of Entrepreneurial Dynamics, a national survey of more than 800 people in the process of starting businesses. He found that writing a plan greatly increased the chances a person would actually go into business.
2. Analyze the business: Once you have some idea of a business that fits your goals and lifestyle, the next step is to analyze your idea. Who will be your customers? Who will be your competition?
3: Make it legal: There are several ways to form a business:
• It could be a sole proprietorship
• It could be a partnership
• It could be a limited liability company (LLC)
• Or it could be a corporation.
Generally speaking, the latter two options are preferable because they limit your personal liability and create a business that is separate and apart from you. You will also need to get the proper business licenses and permits from your city, county, and/or state. Start with your city business office and see what they recommend.
You should also check out your insurance options, and find a good accountant and lawyer to be on your team.
4: Draft a business plan: If you will be seeking outside financing from friends, relatives, investors, or a bank, a business plan is a necessity. But even if you are going to self-finance the venture, drafting a business plan will help you figure out
1. How much money you will need
2. What roadblocks to be on the lookout for
3. How long it should take before becoming profitable
It is like a pilot's flight plan – a business plan helps you figure out how you are going to get from here to there.
5: Get financed: Most small businesses begin with money from savings, credit cards, personal loans, help from family, friends, and do on. You should also check out Small Business Administration (SBA) guaranteed loans. These loans, administered by banks, offer great terms.
5. Find your first customers
Your first customers are key--and not just because they're turning on the revenue spigot. They also legitimize your idea, demonstrating that there actually is a market for your products and services.
They're also a source of valuable feedback that will help improve your business so more customers keep coming in. Don't overlook the opportunity to ask if you can turn some of the positive feedback into testimonials.
Where do you find your first customers? The answer varies somewhat based on your industry, but one common strategy is to leverage your personal and professional contacts--and their contacts. Those could include former employers, employees and customers, contacts within your civic activities, such as Rotary or Kiwanis, and tradespeople and professionals, anyone from your dentist to your plumber