How to Start a Small Business in 7 Steps

how to start a small business

A small business always starts out with an idea. Maybe it is something you have been thinking about for a long time while working at your full-time job. Or, maybe you had a breakthrough “epiphany” moment and came up with a brilliant new business idea. Good business ideas do not have to be completely new, either. You can achieve success by offering improved versions of products or services that are already available, perhaps with lower price points.

Whatever the case, getting your small business off the ground does not require a boatload of money, or years of management experience. All you need is a good business plan and strong business acumen. If you are unsure where to begin, this Balboa Capital blog post can help. It explains how to start a small business in seven steps.

1. Conduct research.

Researching your market, your competitors, and your future customers will help you plan for success. Market research will help you determine your business idea’s immediate and long-term potential. In addition, the information you gather can be used when differentiating your brand, and when developing your marketing campaign.

If you do not have enough capital to hire a research firm, you can conduct research on the Internet. Libraries, industry associations, and state agencies are also good resources.

2. Write a business plan.

Coming up with a solid business plan is a challenge for many business owners. They are passionate about their ideas and want to get started quickly, and writing a business plan can slow things down. While creating a business plan is an involved and time-consuming task, it needs to be given your utmost attention.

Your plan will describe your company and the products or services it offers, along with all of the details relating to operations, financing, staffing, marketing, and growth. The basic sections of a business plan include an executive summary, business description, financial overview, marketing strategy, and sales objectives.

3. Choose a business structure.

Choosing a structure can be confusing, as corporations, S corporations, partnerships, LLC’s and sole proprietorships each have their own unique benefits. As a result, it is a good idea to consult with an attorney or accountant prior to making your decision. The type of legal business structure you choose will depend on liability, tax considerations, and record keeping.

4. Select a name.

The name you choose for your company is extremely important. It needs to convey what your company is about, and resonate with potential customers and investors. Catchy, simple, and easily understandable names can grab the attention of your intended audiences. Write all of your choices down and revisit them after a few days or weeks to see if you still like them.

After narrowing down your favorites, conduct an online search to find out if they are already taken. You can also check with the US Patent and Trademark Office to see if a company name is trademarked. Once you decide on a company name, register it with your state or county clerk’s office. For added protection, hire an intellectual property attorney to trademark your business name.

5. Get licenses and permits.

Depending on the type of business you are starting, and the state in which it is located, you may need to get a variety of licenses and permits. Federal, state and local governments require these. Consult with an attorney to find out which licenses and permits you need in order to comply with business laws. Not doing this can result in legal problems down the road, as well as hefty fines.

6. Obtain business funding.

Most entrepreneurs are cash-strapped prior to launching their companies. If you lack start-up funds, there are several small business funding options for you to consider. Credit cards, crowdfunding, short-term business loans, and raising money from family members and friends are popular choices to finance start-ups. It is worth noting that obtaining a business loan from a bank can be difficult because of their strict lending criteria.

7. Launch.

After all of your hard work, it is time to make your dream of entrepreneurship a reality, and launch your new business. To make your launch a success, get the word out in the weeks ahead on social media, and on your website.

Also, send an email announcement to your friends, family members, and business contacts. New businesses are newsworthy, so call the editor at your local newspaper to let them know about your company, and ask if you can be featured in a story.