Whether you’ve just thought of a great idea for an IT startup or are planning to become a social media celebrity and make a name for yourself, you need to know where to begin. With this step-by-step guide to starting your own business, you’ll get familiar with the basics.
Step 1 – Do your research
A good product idea isn’t enough to make a business – you need to make sure there actually is a demographic that will buy it. Extensive market research is a must before starting a business, as you need to figure out who your potential customers are.
You should also make sure you are knowledgeable enough about the industry your business will be in, as well as research your local and global competitors. Make sure your product offers something that other similar products do not – this way you’ll have an edge over the competition.
Step 2 – Don’t neglect your business plan
Writing a business plan using the best template is probably the most important step to starting a business. Don’t simply rush into it – a lot of startups come to regret not putting in the hours when writing their business plans, as it creates dozens of problems later on.
Your business plan should provide evidence that proves your idea to be profitable. It should also clearly describe the purpose of your company, your customers, your goals, and your financing methods.
Step 3 – Think about your accounting needs
Accounting is more than just doing your taxes – proper bookkeeping and frequent ledger analysis will allow you to create future projections with ease. They will also help you evaluate your financial situation and assess your company’s performance.
Statutory compliance is a huge part of every business – to avoid future problems, you need to make sure you operate fully in accordance with the law. Before starting your company, check whether it’s functioning without breaking any rules.
If you can’t handle your own bookkeeping, consider hiring a professional accounting and auditing company. It’s often the best bet to let experts handle delicate processes like:
- financial statement analysis
- creating amortization schedules
- payroll compliance and preparation
- VAT handling and compliance
Without accounting, you can easily lose your business to fines given in case of an audit – better safe than sorry.
Step 4 – Establish solid financing methods
Having a sound business idea is one thing, but finding the means to finance it might become a problem if you let your imagination run wild. A break-even analysis is one of the most commonly used tools for establishing your company’s financial needs – it provides you with a minimum performance your business needs to maintain to avoid going into the red.
Business loans are among the most common funding methods, especially when you’re considering starting a small business. You might also look into potential investors who will provide funding in exchange for shares in your company.
As you can see, starting your own business can be a complex task – and these are only the basics. When planning to launch your company, don’t rush the preparation phase. It’s often better to delay the launch than harm your growth opportunities in the future.