How To Start A Business

Guide To Getting Your Business Off The Ground

How To Start A BusinessIt takes a huge commitment and a lot of determination to start your own business. Many entrepreneurs fail before they even officially launch their companies – mostly because they have not thought out the steps necessary to get from the initial concept to realized business, and beyond to success.

Some will say you have to fail in order to succeed, but it is best to be as fully prepared as you can be when taking on the task of launching a new business. That is why we have created this resource to help educate entrepreneurs interested in starting a business and providing them with insights on some of the strategies needed to be successful.

How Do You Start A Business?

Regardless of industry, starting a business follows a fairly universal procedure. It begins with a concept, which is expanded upon in the form of an official business plan. From there, entrepreneurs must register their company names and get a federal tax identification number. After that, business owners must find sources of financing to successfully launch and sustain their operations.

Is There A Need Or Desire For what You Are Offering?

Every year, people start businesses all over the country, only to have them fold shortly after launching. One of the main reasons for this is the lack of market research. For a business to succeed, there has to be a viable need or want for the products or services offered by a company. Entrepreneurs must look outside of their great ideas and research what products and services are currently available, and if they line up with your business idea. Additionally, it helps to do market research to see if people are interested in what the business is going to offer. Some entrepreneurs put together focus groups or online surveys to hone in on potential customer responsiveness and price points.

What Sets Your Business Apart From The Competition?

Some people will start a business geared toward a specific niche in a larger industry. The reason for this is to not only reduce the amount of competition but to also stand out to the target client base. For example, there was a time when bookstores did not have much that differentiates them from one another. They all sold new releases, and the competition to offer the best prices to customers did not leave much of a profit margin. Suddenly, there was a push to one-up the competition by offering “more than just books.” Almost overnight, bookstores started to incorporate cafes, music, movies, and other items to differentiate themselves. Unfortunately, almost every bookstore had the same strategy, and it did not take long until they were all on the same page once again. In the meantime, smaller bookstores realized that by specializing in different areas, such are antique books, rare editions, local history and the like, appealed to people more than the larger book vendors, who found themselves losing out major online stores and the consumer switch to e-books. Instead of trying to keep up with the competition, figure out what sets your products and services apart from other companies, and start a business with a unique offering that allows you to carve out a niche in your industry.

How Big Do You Want To Be?

Starting a business requires entrepreneurs to have a vision. How big you want to be, needs to be thought about on two levels. First, how large of an operation are you comfortable with? Does your business require a sizable workforce, or is it designed for an agile and lean team of experts? Second, how big of an impact do you want to have in your industry, and how much territory do you want to cover? All emerging entrepreneurs should have growth goals in mind before launching. This does not mean that businesses need to adhere to the road map to meet those goals. However, it is wise to have a general plan for growth. Real world situations can delay business growth, or it can propel entrepreneurs into growing pains well ahead of schedule. This brings us to the next important step in starting a business.

Without a doubt, a business plan is the most important key to starting a business. A business plan details everything from start-up costs to operations, resources needed, and a timeline that shows how long it will take for a company to start turning a profit. Business plans are incredibly useful guidelines and reference tools, and they are required by most banks and commercial lenders when seeking working capital to launch a new business. It is important to note that business plans are not carved in stone. When starting a business, any part of the business plan can be modified or rewritten entirely. The key word is “plan.” Reality rarely lines up with plans. Sometimes, businesses find that the direct competition is a lot lower than initially expected, or that the potential for growth and revenue are a lot higher. Emerging entrepreneurs should be as detailed as possible when writing their business plans. Lenders want to see that no stone is left unturned when reading a business plan. If business owners present their forecasts, projections, budgets, and analyses from a position of thoughtful authority, lenders will be more inclined to approve funding requests.
Starting a business is a lot like starting out stranded on an island. If you want to survive, you need to have an understanding of your surroundings. You need to know how to acquire resources. You need to reach out to other possible inhabitants to network or to build a team and put the right people in charge of certain duties which as in line with their strengths. Once you have established a small village and begin to grow, you will need more resources and possibly transportation. You will want to signal other people and let them know why your village is the best so you have their loyalty and establish trade routes. A business plan shows that you have done your research to show lenders why your business should exist. Beyond that, you need a practical approach to starting a business from the ground up. You need to make inroads with suppliers and vendors. You need to scout out talented people to fit the roles you need so you can focus on running the business, rather than wearing all the hats in the company.
Branding is much more than having a clever slogan and visually appealing logo. Branding is a much larger concept that incorporates your company’s values, mission, commitment to customers, and marketing. To use real-world examples, people recognize the Coca-Cola and McDonald’s logos very easily, but its what those logos stand for that generates billions of dollars in revenue. McDonald’s sells food. That is their product, but it is not their mission. If you talk with the powers that be at the corporate level, they will tell you that McDonald’s sells happiness. That’s right. The fast food “Ambassador to the World” has Fun Zones, Happy Meals, and offers a place where families and friends can gather to have a safe, enjoyable time. Because of this, people will pay for the food as a price of admission. Combine this with the great work of The Ronald McDonald House and all of their charitable work, as well as creating new menus to appeal to international customers, and it is very difficult to see the McDonald’s brand as simply a fast food franchise. There is a synergy of sorts that takes all of the aforementioned that makes the Golden Arches internationally recognizable. In a similar manner, you need to take a hard look at your own branding when starting a business. What are you offering to your customers? What are your goals for the company? What values make up the core of your business? What intangible values – happiness, for example (and no, McDonald’s does not have the monopoly on smiles) – are you trying to convey to your target audience when you start your own business? For that matter, who are your customers? These are hard questions you will need to ask yourself when starting a business in order to develop a strong and unique brand for your company.
Even if you are starting a business for an idea that has never been done before, there are still some basic laws of business that cannot be avoided. If you have never owned or run a business, it is imperative that you take courses in business management and accounting to get a handle on the most basic skills to ensure you have a successful launch. If you already have experience holding executive positions at other companies, it can never hurt to take a few refresher courses, or brush up on the latest trends and innovations in your industry. There are many free resources online that will teach emerging entrepreneurs how to do things like business accounting, taking inventory, dealing with suppliers, securing start-up financing, and how to develop contingency plans. There are also more advanced courses available on topics such as business ethics, project management, logistics, and other factors which are key to long-term success. Starting a business is a very involved process, and building your own skill set is a great place to start.

There are myriad financing options available for entrepreneurs. Most people who are new to owning their own business may have a difficult time securing a bank loan (less than 40% of all business loan applications are approved by banks), which leaves entrepreneurs looking to alternative lending methods to get the start-up funding they need. It is best to explore private lending options to figure out which type of financing works best for your business model. As mentioned earlier in this article, all lenders – be they banks, commercial lenders, or private investors – will want to see a detailed business plan so they can understand your business, and for reassurance that you have done the necessary research to understand how much financing you need and how it will be allocated.
Starting a business requires entrepreneurs to register a business name and get a business tax identification number. Once registered, the business will have a credit record. When seeking financing for a business, lenders will want to check the credit ratings of the business. For new businesses, there may not be enough of a credit history to qualify for most financing solutions, in which case lenders will look at the business owner’s personal credit score. It is imperative that business owners get a detailed copy of their credit history before seeking financing. Look for any anomalies or outstanding balances, and clear up anything that would stand out as red flags to lenders. Keep in mind that any changes to your credit ratings will take roughly a month or so to reflect in the report. Also, credit agencies are large organizations. On rare occasion, an outstanding balance will linger on a report when it was paid off a while ago. In these cases, it is very important to contact the credit agency, or the company reporting the outstanding balance, and have it removed. The best advice is to get a copy of your personal credit report the second you start to put things together for your company, so you have the best credit rating possible when approaching lenders for financing to start our business.
Most entrepreneurs find that the easiest way to get financing is through loans from the Small Business Administration or SBA. SBA loans are geared toward those people who are starting a business of their own and need financing for everything from working capital on up to equipment and even commercial property. However, not all SBA lenders are created equal. With the number of small businesses on the rise, the SBA is inundated with loan requests on a regular basis, which can slow down the approval process. In order to expedite things and help entrepreneurs start their businesses faster, certain lenders have been designated as “preferred financial services companies.” These financial professionals can process SBA loan requests in-house and get the most competitive terms and rates. When starting a business, using a preferred financial services company can get funding in your hands much faster than trying to submit a loan request on your own.
As a state and federal tax requirement, all entrepreneurs must register a company name, in addition to deciding what type of business the operation is going to be (LLC, S-Corporation, etc.), and get a Tax Identification Number (TIN) from the IRS and state tax agency in order to legally operate as a tax paying business. All of these things are necessary, even if the only employee in the company is the business owner. Starting a business means all tax and legal aspects must be squared away before doing business with any clients.
Depending on the type of business, there may be permits and licenses that are required by state and federal law in order to operate. When opening a restaurant, for example, a business owner needs permits to sell food, a liquor license if the establishment sells alcohol, and any requisite health inspection certificates and safety permits. Starting a business can require many permits, especially when operating out of a commercial building or office space.

In the business world, as with most things in life, things rarely go as planned. Sometimes there are obstacles. Sometimes there are huge successes. And other times, new business ventures find themselves venturing into uncharted territory, with no precedent to draw upon for guidance. Business owners need to plan for multiple outcomes at every turn, and have working capital to act upon those contingencies, should they arise. There are also unexpected occurrences which no one can control. If there is a recession, for example, what safeguards do you need to put in place to ensure your business can weather the storm? Is your business based on something people will still purchase when money is tight? These are things you must consider before diving into the entrepreneurial world.

In every city, there is an organization for small business owners. Overtly, these organizations offer great networking opportunities for business owners, which allows to partnerships and plans to showcase local businesses to help improve companies as a whole. Beneath that, business owners associations are places where emerging entrepreneurs can draw upon the experience of more established business owners to overcome obstacles or avoid pitfalls that not be obvious to those just launching their own operations. When starting a business, it is important to join one of these community organizations for business owners help one another and get their companies noticed.

Marketing is integral to any business, and in this day and age, starting a business means marketing on a number of fronts. Leveraging social media is integral to not only selling products and services but also with branding, as we mentioned earlier in the article. Having a strong social media presence is a great way to launch marketing campaigns. Remember, today’s consumers are much savvier than ever, and can recognize a sales pitch a mile away. This does not mean you have to be devious about things because customers also recognize dishonesty. When starting a business, incorporate your core values into your marketing. Improve the signal to noise ratio by generating marketing materials that engage customers on some level. Marketing needs to connect with your target audience in order to draw them in for a potential sale. Think about the ads you see on television, online, in the paper, or hear on the radio. Which ones appeal to you and why? Take a look at the social media feeds for large corporations. Study how they engage their viewers. Develop a marketing style that reaches your customers.

Starting a business does not mean learning about your industry stops. The bookstores we mentioned toward the beginning of the article? Major chains went under because they refused to acknowledge that the consumer market was shifting towards digital formats. All industries are fluid, to a degree. New technology comes out and changes methods of production. New platforms become available for marketing to customers. Certain services and products become outmoded, opening new markets for innovative thinkers and leaders. The point is that starting a business, while it is a goal, is not the finish line by a long shot. Read articles, go to trade conventions, and seek information wherever it is available to stay ahead of the curve. To drag out a tired adage, sharks must always move forward to thrive. If they stop, they die. Starting a business in a competitive marketplace is no different.

Want To Start A Business Working From Home?

Many entrepreneurs desire financial independence while having the freedom to set their own hours and work out of their own homes. This greatly reduces the start-up costs, licensing, and the need for excessive marketing.

The Commercial Capital Training Group (CCTG) gives people the tools and training they need in order to work from home as commercial finance professionals, as well as providing the support of a panel of finance professionals who are available day and night, to help you grow your own business.

CCTG has a very low start-up cost, and provides the freedom to run your business on your terms, while building up revenue streams and bringing in profits that are virtually limitless, simply by introducing entrepreneurs to private lenders and then taking a broker’s fee for yourself.

If you are looking to start a business, but want the training and guidance that does not come with most other entrepreneurial ventures, with the potential for six-figure profits on your terms, then consider joining The Commercial Capital Training Group.

Further Reading