When venturing into business ownership, you have two options: franchising and starting from scratch.
It’s clear you want to build your business from nothing, and it’s easy to see why. Starting a business from scratch gives you a great sense of autonomy. You’re in control of your entrepreneurship destiny.
But then, you need to know that starting from scratch increases your chances of failure. Way too many small businesses fail and you don’t want yours to be among them.
To help you start on a solid footing, we’re sharing a guide on how to set up a business the right way.
Validate Your Business Idea
No one wakes up one morning and opens a new business. Well, you can do that if you want, but it won’t be long until you’re back where you started.
The first step to starting a business from scratch is to have a business idea. And it’s not enough to have an idea. You need to validate the idea. This is the process of ensuring that the idea will lead to the development of a product or service that solves a problem and will generate strong market demand when it hits the shelves.
Validating a business idea largely involves conducting market research. Send prototypes of the product to people and see what their response is. If most of them like it, that’s a sign your idea is valid.
Draw a Business Plan
Some small entrepreneurs don’t bother to write a business plan when starting a business from scratch. They assume that such a small business doesn’t need any detailed planning.
Don’t make this mistake.
A business plan fleshes out key details about your upcoming business, including the business name, mission and vision, sales and marketing strategy, startup capital requirements, and financial projections.
When you, for instance, have an idea of when your business will start generating a profit, it’s easy to assess the performance of the business once it’s open and establish whether it’s hitting the set milestones. If it isn’t, you’ll be in a better position to make changes early enough.
Secure Startup Capital
Another key benefit of writing a business plan is you get a clear estimate of the amount of money you need to set up the business. Startup costs vary depending on the kind of business you’re starting, but the gist of this is whatever amount you need, ensure you have it before opening the business.
You can use your personal funds, secure a personal or business loan, run a crowdfunding campaign, or get an investor.
Register the Business and Set Up the Premises
You already have a business name and an address. It’s time to get registered.
If it’s a sole proprietorship, you can do the process on your own. But if it’s an LLC, you might need to seek the help of registered agent services.
Once registered, set up your premises. If it’s a brick-and-mortar store, get the space ready for business. If it’s an online store, build a proper ecommerce website.
How to Set Up a Business Simplfied!
Starting a business is a smart move, but success won’t come easy. You need to build a strong foundation and work toward your business goals. Follow this guide on how to set up a business from scratch and you’ll be well on your way.
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