Things to consider before starting a business

Everyone wants to be an entrepreneur. But do you believe that being an entrepreneur and running a business is a cakewalk?

Never!

There are millions of reasons for you to start your own business. Several people start a business without having a long vision or a proper plan. As a result, a minor proportion continues it, and a very few flourish in it.

If you are a budding entrepreneur or someone who is aspiring to be, then this is for you. Here are the 15 steps you need to consider before giving it a shot.

1. Choose the category of business.

You should have a proper idea of what you are going to sell/offer to the customers through your business. Generally, they are of 3 types.

A) Service – Here the product is not a tangible one, instead it is an activity that helps the third party or the consumers. Example: transportation, salon, etc.

B) Merchandising – It is retail sales or wholesale, which is the provision of goods to consumers. Example: retail outlets, online sellers, etc.

C) Manufacturing – In this case, it utilizes raw materials, parts, and components to produce several products. Example – gadgets, clothing, etc.

2. Identify your Customers

Having a beneficial product or service will not give a profit unless you fail to identify the target customers.

Before you begin to design and develop a product or service, conduct market research in-depth. In addition to that, identify your customers and their needs. This will help you to develop your product accordingly.

3. Location

The location has a crucial role in the impact of a business. Make sure your business is accessible to your target customers and it is in the perfect location where it can attract new consumers.

4. Formation

After completing the above-mentioned steps, plan how to form this business. It can be either sole proprietorship, partnership, or corporation.

A) Single proprietorship – Here, you are the only owner of the business.

B) Partnership – Here two or more people share ownership, as well as the responsibility of the business.

C) Corporation – In this case, the business is divided with stakeholders, and a minimum of 5 members are needed to form the corporation.

5. Capital

It is the initial investment that is required for the starting of a business. It can either be in the form of cash or non-cash. However, in order to find the initial capital, one must list down all the expenses such as operating expenses, assets to purchase, renovation, etc.

6. Asset Requirements

You should have a proper plan on the assets that will be needed while operating. This can include furniture, computer, vehicles, equipment, etc. All the necessary items have to be identified and list down their quantity as well as price.

7. Lease, Renovation, and Improvements

The next factor to consider is if you will require a space to rent out. If you are planning to rent one such space, have an idea of what kind of space is required, how much is your budget, the amount required to refurnish and renovate these places, etc. Form a rough budget based on this. In addition to that, some may ask for advance rent and security deposits. Hence, prepare for this as well, while forming your business plan.

8. Suppliers

Succeedingly, identify potential suppliers who will produce the goods or services that you will sell. Choose them by considering certain factors like reliability, price, location, working hours, quality, etc.

9. Operating Expenses

Identify and note down every expense that is needed while running the business. This may include rent, salary, utilities, office supplies, other operating costs, etc. However, it is always suggested to keep in advance the 6 months to 1-year expenses as initial capital in order to run the business smoothly.

10. Hire people or outsource

This is one of the crucial steps to keep in mind before starting a business. Either you can hire people or outsource the work. While hiring employees make sure you follow every regulation regarding this. However, in case if you are planning to outsource, consider the reliability of the company you are planning to outsource to.

11. Registration

Once you decide to move ahead with your business plan with proper clarifications in the former mentioned steps, then register your company to legalize the business as well as to get support from concerned authorities before you begin to operate. Register your business carefully by following the proper guidelines.

12. Bank account for the business

While starting a business, it always suggested having a separate bank account. This will help you to track inflow and outflow of the money as well as preventing mixing up of financial details from a private account. Remember, while choosing a bank, it should be accessible and available.

13. Marketing

Marketing has a pivotal role in the success of a business. A proper marketing plan has to be there to attract your target customers. Remember to choose a perfect platform too for marketing your business.

14. Government Compliance

This is an important factor to consider, which is reporting to the government at regular intervals on a monthly, quarterly, and yearly basis. Failing this may result in facing consequences such as paying huge penalties. Hence, this should be considered seriously.

15. Accounting and Financial Analysis

While operating a business, it is necessary to have a reliable accounting and financial reporting system to track the entire flow of the business. This is necessary for taking decisions, formulating plans, and policies for the future.

Insights into these steps will help you to have a proper plan before starting your own business. Have a proper look through all of these and plan accordingly.