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Starting your own business in the current economic climate can seem daunting, but it doesn’t have to be. With the right planning and knowledge, you can learn how to start a small business!
When you begin your journey to become an entrepreneur, you need to determine what type of business you want to run and who your target market will be. Here are five steps to starting a small business from concept to execution.
1. Identify a market gap.
Every industry has holes, and not just in the way. Understanding what no one else is doing and finding a way to fill it can be powerful. Plus, it’s good to know what you’re running into, because if you’re looking for something people are already well versed in, you need to have a new or significantly different perspective or skill set. For example, women have been marginalized in business startups in the past, but I have found that they are a huge untapped market. Research shows that companies with at least one woman on the board of directors performed better than companies without.
2. Select your goods or services.
One of the most essential parts of starting a small business is creating a product or service that people want. Research different industries first to find which niche you want to go into. Then figure out what you are going to offer your customers. One way to do this is by learning about their pain points, what their interests are, and what they would like more of to meet their needs. Finally, once you have an idea for a product or service, think of some ways to market it.
3. Make a plan and get advice from experts in the field.
A business plan can help you map out a lot of details about your business, but it’s not the only thing you need to know. Be sure to reach out to other experts in the field for more knowledge. For example, here are some things you can get advice on: legal, financial, marketing and social media strategies, sales tactics, and more.
Once you have all this information from experts, create a plan of action: take what they told you and use it to craft an action plan that will help you grow your business. Focus on what makes sense for your business based on what was discussed during the meeting or phone call with each expert.
Start small when expanding into new markets: One way to expand is by leveraging digital channels such as Google Ads or Facebook Ads, which allow businesses to target very specific groups of people with specific interests.
4. Spend some time on your finances.
To say you’ve planned your finances properly, you need to calculate the start-up costs: the cost of labor, rent, licenses and permits, and any other additional costs that may arise. It is also important to make plans for the future. It is often recommended that you have the money to cover up to six months of operating expenses as it can take a while for your business to turn a profit.
Now decide how you will finance your business, such as internal financing (personal savings, money from friends and family, credit cards) or external financing (including small business loans, grants, venture capital and crowdfunding).
Another important aspect of finance is insurance. It’s a good idea to set aside money to insure your business, regardless of its size. The type of policy you get will depend on your business model and the risks you face.
Finally, allocate some of your finances to acquire the right tools for your business. Not only will this make your life easier, but it can also keep your business running seamlessly.
5. Market and scale your business.
It is common for many business owners to invest heavily in product development and neglect the marketing budget until after the product is launched. However, in my experience this is not the best way to go about it. Marketing helps your business scale to the next level by expanding your customer base and ultimately increasing your sales. Be sure to remember to build a solid team as your business scales.
Starting a small business takes a lot of time and work, but it can be very rewarding. Trust the steps above and once you get your business up and running, stay organized and don’t lose focus.
The information provided here is not investment, tax or financial advice. You should consult a licensed professional for advice on your specific situation.
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