Opportunities to launch a business, in many respects, have never been easier than today. Digital technology has advanced to a point where many of the necessary components can be addressed online, without the time-consuming and labor-intensive obligations of the past.
Nevertheless, for anyone wanting to launch a business, you may need to take certain key actions in order to tilt the odds of success in your favor. Here are several must-dos to include in your own startup checklist:
Bring passion to your enterprise. A new business will probably consume most of your waking hours, so it's important that you care deeply about your proposed product or service. This will get you through difficult times and keep you energized on a continual basis.
Do industry research. Before going further, it's important to know that someone else hasn't already preempted your great new idea. Fundamental market research may quickly indicate whether there's a void in the marketplace that your new product or service idea can fill.
Create a business plan. Having a business plan in place will help save you considerable time and resources later on. The good news is that you don't have to "fall into the trap of trying to create the world's biggest and most robust business plan," notes serial entrepreneur Matthew Toren. Instead, focus on a one-page business plan that provides a big-picture view of your budding enterprise. Toren recommends the following:
- Identify the end-result of your business vision.
- Explain why you have embarked on creating this vision--that is, its reason for existence.
- Pinpoint your key objectives and strategies for attaining those objectives.
- Outline a basic action plan to move your strategies to reality.
Start the search for funding. You'll need financial resources to get your business off the ground. If you have funds in reserve, be sure to place them in an account that's separate from your personal savings or checking account. Establishing a free business account at a bank or credit union generally requires no more than an initial deposit, filing paperwork, and proprietor licensing data.
Other potential funding sources include investors (such as friends or family members), a small business loan, home equity loan, or a personal bank loan.
Choose a legal entity. Speaking of licensing, be prepared to attend to city, county, municipality, or state licensing requirements for your new business. Designating yourself as "sole proprietor" has both advantages and disadvantages, so consult a local attorney or tax professional for the best professional advice on how to proceed (and save your business from legal mistakes).
Put together a realistic budget. Nearly everything about a startup costs money. Your job is to establish a realistic budget that accounts for all these outgoing expenses. Typically, this involves planning your startup's "burn rate"--the amount of money you'll likely spend on a monthly basis before making a profit becomes necessary. As a general rule of thumb, it's a good idea to add 15-20 percent to your estimated burn rate in order to cover all the expenses you don't foresee at this time.
Line up your first clients. While you're attending to the nuts-and-bolts items listed above, start getting in front of friends, family members, and those in your professional network to let them know about your new business. Line up some initial orders for your new product or service, but also be prepared to give something away.
The key is making people aware of your business, gauging interest in what you have to sell, and conducting some test sales to gauge potential interest. You might also get insights from prospective customers in ways to refine your pitch (and/or your product) in a way that makes it more appealing to others.
There are plenty of other to-do items on a new business checklist (securing a URL and setting up a website, for example), but attending to the actions on this checklist can help get you up and running, with a clear vision of the future and a strategy for getting there.