Success is the ability to go from failure to failure without losing your enthusiasm. Starting a business is no easy task, anyone that owns one will tell you that the beginning is the hardest part. You work hard, get paid nothing, and are lucky if you don’t have to pay your business to stay afloat; so we ask ourselves what makes the difference between success and failure. The answer is simply within each individual and goes back to how bad you want it to work. If you want it bad enough you will make it, if you want it bad enough failure will only drive you harder and never stop you.
We heard Michael Jordan say how many times he has failed in his career and speak of it as if it was success. The reality remains that failure is a stop on your road to success; it is simply an obstacle that we must anticipate and must have a backup plan for.
So how do you start a business?
There are many aspects to starting a business and we are going to address them all. This is going to be your one stop source for knowing the basics behind starting a business.
This is your 7 step guide to starting a business:
1. Perfect your product or service
If you are going to sell a product or service, make it is solid and full proof before trying to sell it or offering it to your customers. A few failed products will get you a bad reputation and the word will travel fast, without mentioning that the liability for the service you offer might also end up in a nasty lawsuit. Making sure you understand what you are selling and making sure it is in its best shape is very important.
2. Have enough money!
There are many things you can do to acquire funds, you can use your savings or a personal line of credit, such as a home equity line of credit or a personal loan. You can also apply for a business loan depending on the type of business and your experience level in that field. Keep in mind that most business loans will be a min of $25,000 and require major amounts of documentation including personal guarantees. Whatever amount of money you need to produce your product or offer your service is not enough to start a business, you will need 4 times as much to make sure you can survive and cannot count on unearned profits.
3. Set up your business!
Starting the business itself can be as cheap as $100 or as expensive as a few thousands, knowing what type of organization you need to set up and the type of accounting system will be key to saving you money. Remember to not overspend and get a complex corporation set up if you haven’t yet had a clear understanding of where your business is headed. The more complex the business structure, the more expensive the set up the more expensive the upkeep and the tax set up. Places like Legalzoom.com are usually a great place to start to set up an LLC or S corp and require very little effort. The cost of their service is $200-$500 depending on the level of paperwork you need. This charge is in addition to the cost for filling with your home state.
4. Make some strong connections
That you choose to hire a CPA, Lawyer and Banker or simply know them. These are important people to have on your side, for advice, counseling or simply to know what your limitations are. You need a good CPA for record keeping, and to know what you can get away with in terms of taxes. You need a good lawyer as your business grows to protect yourself and get sound advice in case of legal trouble and finally you need a banker to stay ahead of your finances, they can help guide you through loans and financing, but also help with fees if you get yourself in trouble. great relationships are important and should be valued.
5. Marketing is key!
Major corporations are eager to cut their marketing budgets quickly as they see no real value to brand anymore during tough financial times. As a new business, your marketing should be a significant part of your costs. You must brand yourself and get your products out there for people to start talking and start using your product/service so they can refer people over to you and you can grow your business. Market your business through stickers, banners, demonstrations, networking and sponsorships.
6. Work HARD!!!
Working smart, not hard is a great philosophy but working hard and smart is much better in the early phases of a business. Having a smart strategy coupled with hard work to deliver your product or service to your customers is very important.
7. Do not neglect service
Customer service should always be your first priority and should be even more important after the sale. This is key to driving more referrals and driving good word of mouth advertising. Make every attempt to offer perfect transactions from beginning to weeks after and ask for referrals. it is important to make sure your clients are happy.
These basic 7 steps are what you will need to breath in order to create and run a successful business. As simple as they may seem, they get harder as you get larger and become harder to manage but as long as you stick to your core business model, you will be fine.