The road to small business success begins by taking the right first steps
There are many steps an owner needs to take to build a successful small business. For a lot of entrepreneurs, the hardest step is the first one. Determining how to take your idea and turn it into a business requires planning and knowing which first steps to take.
Don’t jump into entrepreneurship head first until you’ve created a plan. Here is a list of first steps every startup should take prior to launching.
Determine Your Value Proposition
What problem will your product or service solve for your customer? What need will you fulfill? And, is there a large enough pool of prospective customers with the same need in order for your business to turn a profit? These are the first questions to ask yourself as you put together your plan.
Find a Small Business Attorney
Choose an attorney focused on supporting small businesses. A small business attorney will be familiar with the unique challenges your business may face and have the experience to help you properly navigate the startup process.
Determine the Type of Entity You’ll Create
Will your business be registered as an LLC, S Corp, C Corp, or sole proprietorship? Each entity type impacts your taxes and legal liabilities differently. Talk to your attorney to understand the options and select the best legal form for your business.
Find a Small Business Accountant
Once you’ve registered your business entity, fine an experienced small business accountant familiar with the particular needs of small businesses including tax filings, deductions before and during the startup phase, bookkeeping, possible payroll requirements, creating and maintaining your financial records, and more.
Select a Financial Institution
To officially start a business, you’ll need to open a business bank account. Find a financial institution for general use and also one that can provide potential funding if you ever decide to expand your business.
Secure Business Liability Protection
Find an insurance agent experienced in supporting small businesses. Before you launch, work with an agent to purchase the right types and amounts of liability insurance so your business is protected.
Create a Business Plan
If you’re seeking startup capital, you’ll need a thorough business plan with financials to present to a bank or private investor. If you’re not seeking funding, a business plan is still a valuable exercise, forcing you to evaluate each aspect of your startup so you can see the big picture and launch with a clear direction forward.
Execute a Cash Flow Analysis
The number one reason small businesses fail is because they run out of cash. It’s important to do everything you can before you launch to understand your cash needs for the first year. Do a month-by-month Source and Use of Cash projection for the first 12-18 months. This will help you determine the right selling terms so you have enough revenue to support your business.
Create a Logo
Develop a logo and overall look for your company that is recognizable and speaks to your company’s personality and mission. A graphic designer can help you create a professional-looking logo – an investment well worth making to help you stand out among your competitors.
Create a Website
Your website is one of the primary ways you’ll interact with your customers and prospects, so it needs to function properly, look professional and create a positive user experience. Especially if you’re planning to sell online or use the website as a sales tool. Work with a web development team and invest in this important area of your business.
Set Up Social Media Channels
Social media is one of the most critical marketing tools for today’s businesses. Identify which social media channels are most important to your customers and make those your priority. Then, come up with a plan for creating content regularly to connect with customers and keep them engaged in your business.
Identify Your Technology Needs
If you’re running a brick and mortar storefront you may have different technology needs than if you’re running that same business through an online app. Determine your tech needs and make sure you have things covered to reduce glitches after you launch.
If You Have Employees, Get a Payroll Quote
Payroll should be a priority if you’ll have an employee on day one. There are a lot of aspects to running a business that owners can and need to handle, but payroll likely shouldn’t be one of them. Payroll providers are usually affordable and pay for themselves with the peace of mind you’ll gain knowing your employees are getting paid on time and your payroll taxes are being filed correctly.
Contact Your Local SCORE Chapter
There’s a lot to do and consider as you take these first steps toward launching your business. Contact your local SCORE chapter and get connected with a mentor. Your SCORE mentor will help you think through each step towards entrepreneurship and connect you to resources and other small businesses that can help you check these steps off your list so you’re ready to launch.
You’ll find a wealth of small business-related information, resources, and training, plus free, confidential counseling from more than 11,000 business experts. For more information about contacting a mentor or volunteering contact the Lake of the Ozarks SCORE Chapter at www.LakeoftheOzarks.SCORE.org, by e-mail at email@example.com or call 573-346-5441. Serving Mid-Missouri with offices in the Lake of the Ozarks, Columbia, Jefferson City and Lebanon.
Funded in part through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.