A Step By Step Guide To Start A Business

Starting a business is a big and scary step; thus, people often ask us for the list of steps they can use to start their own business. Although starting a business entails understanding and dealing with many issues such as legal, finance, human resource, liability protection, intellectual protection, and various others. Someone who never done it before may feel a little nervous and possibly overwhelmed, but don't let these feelings stop you.

10 Best Business Guide To Start A Business

Starting your own business is a brave decision, and if you are the one who is ready to take the chance, then it comes with various big rewards. Here in this article, we will break down the 10 essential steps that will help you start your business smoothly.  

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Also Read- How To Register Private Limited Company? A Complete Guide

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So, Let’s get started

1. Perform Research And Find A Business Idea

When you are thinking about how to start a business, you are more likely to fall into one of two categories. First, you might have a fantastic business idea, but you are unsure about launching a business. In this case, you can skip the market research discussion section.

On the other hand, you have no idea about what kinds of small business to start. In this case, your first but crucial step is to decide the perfect business idea. To find the excellent business idea, you can ask yourself some question which are

• What Skills Do You Have?

The answer to this question might involve your passion, hobby, skill from your previous job, or your college project skill.

• What Resources Are At Your Disposal?

Starting a business involves a significant investment. Identifying what resources already available can help you start a business at minimum expenses and maximum profitability.

• What Need Could Your Fill?

Carefully analyze your little corner of the universe, what product, service, or conveniences do you see are missing? Many of the most successful ideas come from identifying a problem and then inventing the solution.

2. Write Your Business Plan

A strong business plan is crucial to start a new business successfully regardless of what business idea you decide to pursue. You might be excited to launch your business idea and start a business right away instead of creating a business plan. But writing a business plan is one of the smart and most important decisions in launching your business.

According to the various studies and research, business with proper plan grows 30% faster than other businesses without any plan. Before creating your business plan, ask these below-listed questions to yourself.

• What Does Your Small Business Do?

When you have a business idea, then the first but the most crucial and simplest step is to write what product or services your business offers.

• Who Is Your Small Business For?

This is called target marketing, i.e., the group of people whom your business meant to serve. The more specifically you answer the question, the better you will be able to create a product, service, and marketing campaign that meets the needs of your demographic.

• Who Are Your Competitors?

If you are starting a business, then analyzing your competitors is extremely important. For this, you need to perform proper research, and this research will save you from creating a business model that is too similar to the established business.

3. Choose Your Business Legal Structure

When you initiate your business, various paperwork and legal requirements are to fulfill. Therefore, the first official task on your to-do-list is to decide on your business entity structure. The business structure you choose will impact how you file state and federal business taxes, the role of the different team members, and how you can be held liable if a customer or other shareholder files a legal claim against your business.

Here are the few business structures you can choose one best suitable form this

• Sole Proprietorship

This is one of the fundamental business structure in which you alone own your business and are responsible for any liabilities associated with it. If you are planning to operate a service business and not looking to hire an employee, then a sole proprietorship is the best business model. 

• Partnership

This defines a single business having two or more individual owners. There are a few small business partnership structures that you can choose from. Most of the lawyers don't recommend partnership as a business structure. It is because, as a sole proprietorship, the partnership also not offer much protection from liabilities.  

• Corporation

It is one of the complex business structures which usually reserved for larger companies. If you are planning your business to take on a lot of employees, eventually, this business structure can be worth full.

• Limited Liability Company (LLC)

This business structure offers liabilities protection of a corporation and the flexibility and tax simplicity of a sole proprietorship. With these benefits, the Limited Liability Company (LLC) has grown significantly in popularity over recent years.

Thus selecting business structure in one of the crucial steps which need to done smartly. It is an important decision that will have long-term impacts on how you do business. So before finalizing your business structure, you need to perform your research and also need to get in touch with the expert.

4. Register Your Business

The next step to discuss in our step by step guide to start a business is how to register your business. Once you complete all your business legal activity and paperwork the next step is business registration, and it can be done in a few simple step

• Choose Your Business Name

If you are looking to use a trading name for your business, then you need to register your business name. To get your business name register, your need to file RUN (Reserve Unique Name).

• Get A Tax Identification Number

It is also known as your employer identification number (EIN). Your tax identification number helps the ITD keep track of your tax purposes. If your business is established as a corporation or partnership, then EIN is essential, but if your business is established as a Sole proprietor and LLCs, you need EIN only when you plan to hire an employee for your business.

5. Apply For Licenses and Permits

After the registration of the business name, a few additional applications left to complete to ensure that your business is compliant with a legal requirement. These are

• Get A Business License

Many locality require a business license or permit before they can start operating. In some places, there is a generic business license for every type of business. Certain highly regulated businesses like childcare centers and foodservice companies need particular business license types before they start operating.

Therefore before you apply for the business license, you need to check the regulations for your industry, state, and municipal to ensure that you get all the permissions you need to start your business legally.

• Apply For Any Needed Trademark Or Patents

This step is not necessary for everyone to start a small business. If your business revolves around a new invention or rely heavily on a particular band, then filing a trademark is essential to protect your intellectual property.

6. Obtain funding For Your small business

Every business has different needs, and for these various capitals are required. Creating a business plan will help you get an idea about how much money is needed to start a business. The funding for business can arrange in a few simple ways;

• Self- Funding

Self-funding lets you leverage your financial resources to support your business. With self-funding, you retain complete control over your business, and at the same time, you also have to take all the risk yourself. Thus while investing, be careful, and don't spend more than you can afford.

• Investors

An investor can give you funding to start your business in the form of venture capital investment. Venture capital usually is offered in exchange for an ownership share and active role in the company. Almost all venture capitalists want a seat on the board of directors. So be prepared to give some portion of both ownership and control of your company to the investor in exchange for money or funding.

• Loans

If you want to control your business solo but don't have enough funds, then the best option is to get a small business loan. To get the loan for your business, you need to create a business plan and expense sheet and financial projection for the next 5 years.

Having these things will give you an idea about how much funds you need to initiate your business. Once you complete your material or document, contact the bank to request the funding. Carefully check all the offers to get the best possible terms for your loan.

7. Create Your Team

An organization is as effective as its people are. Thus after getting funding, the next step is to consider your team and start hiring the employee for the help you need. Your team might consist of freelancers, virtual assistance, consultant, and contractors.

Although any person who supports or deliver on your company's mission is the part of your business team. When you plan to start the hiring process, you need to pay a sufficient amount to time to create job descriptions and interviewing candidates. In a start-up business job description, you only go so far, so during the interview, you need to check the attitude and comfort level with uncertainty.

8. Open A Business Bank Account

This is one of the crucial steps for getting started and for the future of the business. Because a business bank account is going to be the place where you will house all of your funds and well as you use for paying your will and receiving your amount from the customer, it also essential to separate the personal and business finance.

With the business bank account, you will be able to separate your expenses, protect your funds, and assets, and also saves your time and effort when it comes to both bookkeeping and taxes. If you are starting a new business, you are more likely to choose a business checking account, as opposed to a business saving account. But before creating your business bank account must check for bank account features like monthly fees, transaction limits, cash deposits, wire transfer, and many more.

9. Learn How To Manage Your Finance

Even you have created your business bank account, but there are still a few essential steps you should know to manage your finance properly. Here is the beginner's guide on how to manage your business finance when starting a small business:

• Create Basis Account Details

Documenting of account details is one of the crucial steps. It helps in various processes, such as filing your taxes, applying for business financing, and internal tracking of your revenue, expense, and profitability. Almost all the business owners at least maintain three primary financial statements those are a balance sheet, an income statement, and a cash flow statement.

• Choose The Best Accounting Software

Managing your business finance can be tricky; thus, choosing the best accounting software is recommended. There is various accounting software which takes the guesswork out of your bookkeeping and generates these accounting document automatically.

• Hire An Expert Accountant

Although accounting software can do an excellent job for you in managing your small business finance, there are few areas of small business that are accounting beyond the limit of software. Then, you need to have an expert accountant to the job correctly.

10. Start Running And Promoting Your Business

We have reached the final point of our step by step guide to start a business. In the above section, we have discussed almost all the essential points. Now in our last point, we will discuss how to run or promote our business.

Once you officially start your business, then promoting your business becomes your topmost priority. For promotion, you need to decide the channel to promote your business by taking specific methods. Promotion is a crucial step to bring customers to your business.

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Also Read- A Complete Guide For Cancellation Of A Registered Trademark In India

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Conclusion

The truth is, listing step by step guide on how to start a business is not easy. We have done our best to explain steps you should follow to start and grow your business strongly. Being an entrepreneur is not easy. It is a never-ending process, 24*7 adventure. Therefore if you are planning to run a small business, you should keep in mind that your learning curve should be constant. In the learning process, Google can be your best friend. 

About Author 

Abhishek Kumar

M.Tech (Biotechnology)