Step 1: Conducting personal evaluation and industry analysis
First, you should begin by asking yourself some questions. What skills do you already have? What do you really like doing? What is the reason behind your business idea? How much capital do you have for investment? Will you provide a service or product?
These questions should narrow your focus and help you determine the objectives of your venture. Remember, this step needs not act as a halting point for your idea, but rather, aid you in the thinking and planning process.
There is a lot you need to start a business beyond your passion. Besides, you need to set goals and make proper plans. What are your weaknesses? What are your strengths? At this level, you can conduct a SWOT analysis of yourself. The SWOT analysis basically involves evaluation of aspects of your business idea namely Strengths, Weaknesses, Opportunity and Strengths.
Once you settle on a business idea that reflects your objectives and lifestyle, you need conduct an industry analysis to understand the niche holding your business idea. Who is going to buy your products or services? Who are your competitors? You can do this analysis by conducting Google searches, read books touching on your target industry, researching key people, and so on.
Step 2: Make it legal and start the planning process
This step entails registering your business and getting relevant certificates and documents of operation. You need to know the pros and cons of a variety of business formations, tax laws, insurance requirements, and your rights and so on. If necessary, work closely with a commercial attorney to obtain useful advice. Depending on the type of business, there may be regional requirements that are unique from the state regulations. This is the time to find out every bit of legal requirements of your business. Other things you need to decide at this stage include business name and logos.
All goals, however, can only be realized through the vehicle of a plan. A business plan is, therefore, very necessary regardless whether you are financing the business yourself or not. The role of a business plan is to make decisions on how much capital is being availed for investment, what part of the business will receive how much amount of the investment and so on. In simple terms, a plan is like a roadmap which you will use to chart your progress and outline the direction of your venture. However, try making your business plan as simple as possible since you will need to use it over and over for a long time.
Step 3: Get financed and set up the shop
This step involves determining the location of your business and set up the premises. Please note that the location of your business relies heavily on the type of clients you are targeting, promotions that you can run and even the length of time you will take to grow. Besides, you need to consider other factors such as the price of your products and the target profit margins, access to public transportation or parking, visibility, regional rules and overall distribution of competitors.
Step 4: Trial and Error
In this step, your business should get on its feet and begin its operations. You may make mistakes regardless of whether you are experienced in running the business or starting the business for the first time. It is natural. Although some mistakes can be devastating, they make you learn some lessons as your business continues to grow. One good thing about being the owner of a business is that you own the mistakes you make and also decide on the direction to take thereafter.