How to start a business
Owning your own business is what many dream of. However, after making a decision to open a business, you need to realize the full responsibility of this step and think through many nuances, each of which can significantly affect the course of business.If you want to start your own business, it is also important to understand that you assume financial, moral, social and other responsibility for all your actions.
How to start your own business
Of course, there is no clear and only correct instructions on how to open your own business. Much depends on the type of business, on your financial capabilities, on your goals. But we can offer you the most generalized scheme for opening a business and it consists of the following steps:
1. Choosing a business idea.
The modern world is full of many possibilities and ideas that can be realized. To choose from them precisely “one’s own” is not an easy task, and many fall into a state of stupor when they start thinking about it. All you need is to collect your thoughts and identify two main things: what you like to do and what you can do. A business idea that perfectly fits both the first option and the second at the same time is what you need.
Many start-up entrepreneurs make a big mistake at this stage – they think only about the financial possibilities of the business, and they completely forget that the business in which they are engaged should be enjoyable. Otherwise, there will very soon be a loss of interest in the activity and, accordingly, such a business cannot become successful.
2. Collection of information.
It is necessary to enter the market only with a sufficient amount of knowledge about it. You will spend a lot of time studying both the basics of running a business and the specific market you have chosen. However, this time will not be wasted in vain – because you create the foundation on which you will later organize your business.
It is important to soberly assess the opportunities and prospects of the market in which you are going to conduct your business. Perhaps, when collecting information, it turns out that the market is already oversaturated and consumers simply will not accept you. Or the market is no longer relevant and has no prospects for development. In such cases, it is worth reviewing your goals and thinking about another area of business.
3. Drawing up a business plan.
This is an important step towards a successful start of a business. Many studies have shown that companies that started with a business plan turned out to be more profitable than those that did not have one. You can use the services of companies that make business plans to order or try to cope with this task yourself.
For more information on how to make a business plan and why it is needed, read the article “How to make a business plan. Example”.
4. Definition of sources of capital.
Some businesses require large amounts of money to start, others more modest. But without start-up capital you can not do. Its sources can be the following: your own savings, a bank loan, or investments from investors.
Many businessmen take a loan already at the first stage (this is especially common in the restaurant business and the real estate business), but here it is important to understand the degree of financial risks. Business can go bankrupt, and the loan taken will be yours. Well, if before starting a business you will have a certain amount of money that will help you cope with possible financial difficulties and not get into debt.
5. Choosing a company name.
The correct name is, in fact, very important. Unusual name will help to stand out from a variety of competitors. The name should contain the essence of your activity, but at the same time be aesthetic and attractive.
6. The choice of legal form and registration of the company.
In what organizational and legal form to register your company depends on the expected scale of activity, cash flow, the number of founders and employees, the availability of property, etc. The most common forms are individual enterprise, limited liability company, joint-stock company. They have a number of fundamental differences, and the registration procedures are also somewhat different.
If you are going to open an enterprise together with partners, then it is important to assess the degree of the relationship between you. Even if you trust your partner 100%, you can never be responsible for the actions of another person.
7. Organization of the accounting system.
At this stage it is necessary to think about how accounting will be maintained. If you have enough knowledge in this area, you can do it yourself. Otherwise, hire an accountant or use the services of an auditing company. Proper accounting is something that you will always know how the financial part of the business in your company is.