The following are 12 most effective tips on how to start your own small business:
- Find business idea
- Research business idea
- Do market research
- Raise the startup capital
- Write a business plan
- Choose business location
- Register a business name
- Get the relevant licenses/permits
- Choose accounting system
- Build a website
- Launch your small business
Maybe it has been your dream to start your own small business but you do not know how to go about it.
To start your own small business need not be a daunting task. People have done it in the past. You too can do it.
This article, therefore, show you the most effective steps you can take to start your own small business.
Find Business Idea
Every business starts with a business idea. Therefore, finding a good business idea is one of the most important tasks you need to perform before you start your own small business.
Sources Of Business Ideas
There are many sources of business ideas. You can get business ideas:
- during conversations with people.
- Business journals/magazines
- Social media platforms
- When people discuss their problems
- Personal observations
For example, when someone tells you that he is making good money from fixing cell phones. This is a salient call for you to learn and start fixing cell phones.
Choose A Business Idea
When choosing a business idea, your skills, interests, hobbies and experience all have roles to play.
For example, you cannot set up a pharmacy if you are not a pharmacist.
Similarly, you cannot start automobile fixing workshop if you have no formal training and practical experience.
However, you can turn your hobbies into a money spinning machine. For example, you can set up a coaching class for examination candidates.
Before you start your own small business, you need to provide honest answers to the following questions:
- Do I have the skills, interests, experience and the knowledge required to fit into the industry?
- What kind of business would best match my interests and skills?
- Am I good at planning, making decisions and carrying them through?
- Am I ready to take suggestions and criticisms from people in good faith?
- Am I good at setting goals, implementing and monitoring them to achieve the desired results
- Will I be able to stay focused even when things get really tough?
- Am I honest in all my dealings with other people?
- Do I learn from my mistakes and make changes based on what I have learned?
- Am I self-confident?
- How much time do I need to devote to starting and running the business?
- How much money can I afford to put into starting a business?
- How long do I need to stay before the business begins to make money?
- How much salary can I pay myself?
Most importantly, if you are not sure what kind of business you want to start, think about your interests and skills.
Research The Business Idea
You should research the various business options available to you before you make a choice.
For instance, your research should be able to find answers to the following important questions:
- Who are the people in this business
- Have other people done this business before
- Did they succeed? If not what was the reason for their failure
- Is there a possibility that government could introduce a policy that might negatively affect the business?
- What is the state of the industry now?
- How will the industry be in the next 5-10 years?
Do Market Research
You need to do market research before you start your own small business.
You should not just wake up one morning, out of sheer curiosity, start a business you know little or nothing about.
Consequently, you need to find answers to the following questions:
- Who will be my target?
- Are they men, women, boys or girls?
- Where do they hang out?
- Do the potential customers know this product?
- If yes, how did they get to know?
- If no, how will i get them to know the products?
- How often will they buy?
- What marketing strategies am I going to use to sell to customers?
- What is the competition like?
- Why will people buy from me, instead of another?
- What will I do differently to make my business stand out from the crowd?
- How much Capital is needed to start this type of business?
- How long will it take before the business starts to make profits?
- Is there sufficient demand for this product to keep me in business?
- Are there other businesses offering the same or similar product?
- Are people buying this product or service online or from physical store?
- Do I need any special licenses or permits to operate the business?
- How can I get steady supplies of stocks?
- What local laws will I need to comply with?
Therefore, you should spend quality time to find credible answers to the above questions to enable you make sound business decisions.
Raise The Required Capital
You need to determine how much money you will need to start your own small business.
For example, you need to decide whether you:
- Will finance the business with your savings
- Get support from family and friends
- Will look out for some government-assisted programs you can zero into.
However, you should not borrow money to start your own small business.
The reason is that interest charges on borrowed money can hurt your business before it even has any chance of succeeding.
Therefore, it is highly recommended that you:
- start your own small business with your fund
- set some money aside to meet your personal expenses for a least the first six months.
- not mix your personal expenses with your business expenses.
Write A Business Plan
Before you start your own small business, you will need to write a business plan.
As Benjamin Franklin puts it, “if you fail to plan, you are planning to fail.
There are different business plans templates for different businesses.
For example, professionals such as engineers, accountants do not need to write a detailed business plan.
However, if you are looking at seeking funding from the bank in the future, you will need to write a detailed business
Furthermore the whether your business plan will be simple or detailed will depend on the nature of your business and your aims and objectives for the business.
Additionally, your business plan should be tailored to meet the needs of your business.
Your business plan should:
- keep you focused on your vision for the business
- serve as a handbook or road map for your business
- show management structure
- figure out succession plan, in case of death, resignations and so on
- your financial projections for the business
- set short and long term goals and objectives
Most importantly, you will need to review and update your business plan as you continue to learn more about your market and competition.
Choose Business Location
Next you need to choose a good location for your small business.
Remember that if you choose a good location, you could:
- get many customers
- make more sales and profits
- plus your business will grow
You should locate your business where it will be easy for potential customers to find you.
Therefore, a good business location is very crucial to the success of your business.
Register A Business Name
Before you start your own small business, you might need to register your business name with the relevant government agency.
However, whether you will need to register a business name will depend on the nature of your business.
Beyond that, you will not have much problems opening your business account with any bank.
Furthermore, lenders will be much more likely to approve financial lifeline for your business in the future.
Most importantly, registering your business name will give your business more credibility. And people will be much more confident to do business with you.
Get Relevant Licenses/Permits
To start your own small business, you need to find out if the business is regulated by government.
For example, some businesses require that you have licenses/permits before you can go into such businesses.
Furthermore, some businesses have a network of associations and unions
Choose Accounting System
Irrespective of the nature of size of your small business, you need to keep some accounting records.
For very small businesses, a well kept cash book might do until the business begins to grow to enable you employ accountant.
At least, at the end of the year, you can call in an accountant to prepare annual financial statements for your business, using the info in the cash book.
Build a website
Moreover, you may need to get a website. This is because many people now do online businesses.
A business website will enable you to showcase your products or services.
Consequently, some of your potential customers will like to visit your website to see your products or services before they do business with you.
Most importantly, you will need to set up some social media accounts: Facebook, Twitter, Instagram, LinkedIn and Pinterest are good candidates.
launch your own small business
When you start your own business, you need to let the world know that you are now in business.
In other words, you should advertise and promote your business so that potential customers will know:
- where you are
- how they can find you
- what you do or sell
- give you referrals and recommendations
Do not just seat down in the comfort of your shop waiting for customers to come and buy from you.
Furthermore, you should work on your business, not in your business.
The following tips will help you to get your business off the ground:
- Use word of mouth to tell as many people as possible.
- Create flyers, business cards and brochures
- Insert your contact addresses in all your outgoing advert materials
- Start networking with people and businesses
- Ask for referrals.
- Register your presence on social media
- Place ads on local media outfits
- Read articles in business journals and magazines
- attend seminars, workshops and conferences
In conclusion, you should remember that business is not for the lazy.
You need to work very hard to nurture the business. And make it grow so that you can get good returns on the money you invested to start your own small business.
Remember that if you succeed you will take all the benefits. But if you fail, you will certainly be on your own.