Question 1: Things to consider before starting a business?
- What am I wanting to do?
The first you need to think about is what you will offer. What are you going to sell in your business and why do you think this will be profitable?
- Target Customer
Ensure that you have a service or product that is needed or wanted by your target customers. Study the market and see how other people have been profitable.
Ensure you have a location that fits your needs as well as the needs of your customers.
Once you’ve identified what to sell, who to sell it to and where to sell it, now think about how you’ll form the business. You will need to obtain a name for your business as well as choose what type of business you will want to be. You can choose on sole proprietorship, partnership or corporation.
Single proprietorship – you’re the sole owner of the business.
Partnership – you can divide the business with another person(s) which you will call partners. You need at least two people to form partnership.
Corporation – you can register as One-Person Corporation (OPC) or divide the business with two (2) or more individuals.
Where will I be getting the resources to start my business? This includes money to start a business as well as but not limited to supplies, tools and materials.
Identity potential suppliers needed to produce the service or goods you will sell. Consider their price, location, reliability and operating hours.
- Operating Expenses
Identify all expenditures that you need to operate the business such as payroll, rent, office supplies, utilities, etc. Consider the monthly costs in your business plan. What will you need to bring in to stay profitable?
Will you need a staff or a team of workers? You will need to determine this and factor these wages into your payroll. Where will you find your team?
Marketing is one of the key factors that can determine why a business will succeed or why it may fail. If nobody knows about your business then how will you sell your product or service?
- Accounting and Financial Analysis
Last but not the least, when you start a business, ensure you have a reliable accounting and financial reporting process in place. Accounting is the language of business. To know what’s really happening in your business, you must have a reliable accounting and financial reporting system.
Question 2: What are some things I should have to start a business?
A: Have an idea for a product or service that you are wanting to provide.
Create a business plan.
Study the market of the business field you are looking to enter in.
Choose your business location.
Determine how you will be funding your business.
Determine the legal structure of your business.
Register a business name and ensure there are no other businesses with the same name.
Register your business with the state in which you will be operating.
Determine if you will need additional employers for your business.
Question 3: What should be my business structure?
A: There are different types of business structures and all of them have their own advantages and disadvantages depending on the business you are wishing to start.
Sole Proprietorship: A sole proprietorship is a type of enterprise owned and run by one person and in which there is no legal distinction between the owner and the business entity.
Limited Liability Company: An LLC is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation. The biggest benefit of an LLC is that it protects its owners’ personal assets should the business face any legal issues.
C Corporation: A C Corp is a legal structure for a corporation in which the owners, or shareholders, are taxed separately from the entity. C corporations, the most prevalent of corporations, are also subject to corporate income taxation.
Partnership: A partnership is a formal arrangement by two or more parties to manage and operate a business and share its profits. There are several types of partnership arrangements. In particular, in a partnership business, all partners share liabilities and profits equally, while in others, partners may have limited liability.
S Corporation: An S Corporation is a business entity that has elected to pass its corporate income, losses, credits and deductions to its shareholders to include on their tax forms.
Question 4: How will I know if I need to hire additional employees?
A: Determine if and how many employees you can afford. Are there required employee benefits I must provide?
Determine your workload as well as the workload of your other employees. If there is more work coming in than your team can handle then you should consider hiring additional help.
Question 5: How do I hire employees?
A: You should reach out and market the position you are wishing to hire for. Determine a competitive pay that is adequate with what other jobs are paying for similar work.
You should consider doing pre-employment background checks to better understand who you are hiring to represent your business.
Ensure that you clearly state your company’s beliefs and standards when hiring so that you have a formidable team that all has similar goals in mind.
Question 6: How much will I need to operate my business each month?
A: Please consider all aspect of starting a business. Create a full monthly breakdown to determine how much you would need to make to pay for employees, supplies, rent, utilities and all funding needed to operate a business. This number will need to be met each month for your business to stay open.
Question 7: How much will it take to open a business?
A: This is all dependent on what the business you are trying to open is going to be. There won’t be a definite answer that is the same for each business but you will want enough to cover startup that includes all supplies, tools, rent, payroll and all costs associated with the business. You will also want to have enough to cover any benefits you wish to provide.
Question 8: How do I determine my target market?
A: You should research the market you are wishing to enter before you ever start a business. You need to determine that there is a need for additional businesses in this market. These are some of the things you will look for when determining your target market:
Demand: Is there a desire for your product or service?
Market size: How many people would be interested in your offering?
Economic indicators: What is the income range and employment rate?
Location: Where do your customers live and where can your business reach?
Market saturation: How many similar options are already available to consumers?
Pricing: What do potential customers pay for these alternatives?
Question 9: Should I have a website for my business?
A: In today’s day a website is very beneficial for any business. Although it is not required for many people a web search is the first place a customer will go when looking for information on a business. You will want to be as competitive as possible in the business market and a website will give you an immediate advantage.