Entrepreneurship is an idea that appeals to many, but figuring out how to start a business can sometimes be so overwhelming it scares people away. It’s time to stop telling people that you’re going to start a business and actually put in the work to make it happen. In this article, we’ll break down the steps of starting a business to set yourself up for success.
How to Start a Business
Starting a business involves planning, making financial decisions, doing market research, and acquiring knowledge in areas you never thought you would learn about before. We created this 12 step guide to starting a business to help you put your best foot forward today. It is important to note that there is no one size fits all model to starting a new business but these steps will help you organize your thoughts, and iron out important details so when you launch your business you have answered all the important startup questions.
Step 1. Ask Yourself if You’re Ready
There will never be a right time to start a business. If the stars couldn’t align for Romeo and Juliet, they probably won’t align for you either. But you can either look at that as the thing that holds you back from starting or use that to push you to start today.
When it comes down to deciding if you’re ready to start a business, it’s more about mindset than timing. Are you in the frame of mind right now to win? If you didn’t shout heck yeah at your computer screen, you might need to re-examine if entrepreneurship is the right path for you.
The reality is saying you’re going to start a business is easy. But doing it, turning nothing into something that makes money, that can be a whole lot tougher.
And you need to be mentally prepared to take something on. Why? Well, there are going to be challenges like creating ads that generate sales. And if your mindset isn’t in the right place, any failure could devastate you. But if you’re in the right mindset, you’ll KAPOW! failures until you finally start hitting your big wins.
Step 2. Determine What Type of Business to Start
The next step of starting a business is to figure out what type of business to start.
Is there a niche that you’re particular passionate about? Are you looking for a business that you actively work on or just own? Are you looking for a business to start by yourself or with a partner? These are just a few of the questions you need to ask yourself before starting a business.
You can start everything from a Shopify store like MVMT Watches did to a freelance business. You can choose to build a business by yourself by owning a consulting business or you can build a company with a team such as a manufacturing company or a restaurant.
To figure out what type of business you want to start, create a list of things you’re passionate about. For example, yoga, personal finance, dogs, movies, food, and clothing.
Next, use a tool like Keywords Everywhere to look up the search volume of your list in Google. This will help you understand how popular your list of ideas is. You can also use Google Trends to analyze whether the trend is trending upward or downward or if it’s stable to determine the niche’s long-term viability.
Then, look at the top three most popular keywords on your list and answer this question, “In five years from now, which niche would not only get me out of bed in the morning but would also excite me enough to continue creating content/products/tools for it?”
So, what’s your big business idea? Feel free to share in the comments.
Step 3. Do Market Research
So now that you have your business idea it’s time to figure out if and how you can make money in that niche.
For example, say you wanted to start a dog business. You can start a dog kennel, a grooming business, a dog sitting website, a dog blog, or start an online dog products store.
In this phase, you’ll want to break down which business type is easiest to start, best aligns with your talents, fits within your budget, and analyze how the industry is performing.
If you’d like to start a business with more than one idea, you can definitely do that. For example, a person selling kitchen equipment online can also other home-related items . And a kitchen blog can also be monetized with an online store.
After figuring out what type of business you want to start, it’s time to start planning your business.
The search volume in the graphic below comes from the Keywords Everywhere Chrome extension in case you want to use that in your research.
Step 4. Set Realistic Goals and Expectations
One of the biggest reasons for failure in business comes from naive expectations. I constantly hear stories of people pouring thousands of dollars into ads thinking they’ll triple or quadruple their money only to end up with that big, fat zero.
So, let’s try to paint what a realistic scenario looks like. Your first year in business is all about failure. Why? Because it’s your first business.
Most people approach their first business with a sense of false optimism. If that guy can do it, so can I, you casually think to yourself. But what you casually ignore is the fact that that guy is on his fourth business or he’s been running it for seven years.
I love, love, love how excited people are as they begin learning how to start a business. But if you go into it thinking you’re going to dominate the world on day one, you’ll be failing in a matter of months due to drastic disappointment.
The difference between a successful business and a failed one is perseverance. Do you have what it takes to keep promoting your business even when you have no customers or website visitors after a month? Are you savvy enough to know when a strategy just isn’t going to work? And are you patient enough to play the slow and steady game (meaning that you might not see sales right away but will see bigger returns down the road)?
Now that you know that those first few months will take every ounce of hustle you’ve got, how will you approach your goals in the foundation stage of your business?
Maybe instead of focusing on your first sale, you might focus on creating content to drive relevant traffic. Or maybe before you start a business, you choose to build a following on Instagram so that you have an audience when the time to launch comes.
You can use SMART goals to guide your goal setting but ultimately the goals you set for yourself based on your experience and business type will be very personal to you.
Image Credit: Crawford Thomas
Step 5. Create a One-Page Business Plan
Unless you’re going to the bank to get a loan, you don’t need to overspend time on your business plan. On a piece of paper, handwrite a plan for your business. While this may be a bit voodoo (sorry!) I find that whenever I handwrite goals, I’m always more likely to achieve them. I always carry my goals around with me which helps remind me of them so I can’t escape them.
Now back to real-world advice. On your one-page business plan include the following:
- Problem your business solves
- A one-sentence elevator pitch (what does your business do)
- A list of your target audiences (e.g. people who own dogs, people who follow dog accounts on social media)
- SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats to your business)
- Marketing plan (list of ideas on how you’ll promote your business)
- Financial plan (list of business costs, how you’ll make money to pay for the business in the beginning and how your business will make money)
- Financial projections for each quarter (e.g. January to March, April to June, etc.)
Step 6. Get Feedback
So now that you’ve got the idea, you’ve set some goals, and you’ve created a plan, it’s time to get feedback on your idea. This stage has been known to kill many ideas (and sometimes even good ones). The point of the feedback stage is to get a second opinion on how you can improve your idea. Instead of asking for feedback on the business idea, ask for feedback on a certain component of it. And whatever you do, don’t ask someone you love. Trust me.
Most cities have business centers where you can speak with an in-house entrepreneur who will give you feedback on how to start a business. Some cities even have programs for younger adults that allow you to be mentored by an entrepreneur in your field. So be sure to get feedback from the right people to help you inch closer to business success.
Step 7. Find a Way to Pay for Your Business
The most common way people pay for their business is through their 9 to 5 job. Avoid quitting your day gig until you’ve generated enough to pay your costs, taxes, and yourself with six months runway. In the beginning, you likely won’t be able to pay yourself, as you’ll need to reinvest your earnings back into your business so you can scale the business faster.
However, some businesses have very minimal costs such as freelance businesses which might require some software or a computer which you might already own or have access to.
Step 8. Pair Up With a Partner
Solopreneurship is on the rise and so this won’t apply to all. But success in business sometimes comes in pairs. Rome wasn’t built in a day and neither was any successful business. There’s going to be a lot of time and resources that’ll go into your business. And having someone you trust to build alongside you can allow you to break up the workload so you progress faster. It’s also great for holding you accountable.
The important thing to stress about a partnership is that you really need to know how well you work with someone. Is this person trustworthy? Have you worked together before? How have the two of you managed conflicts in the past? Do your skillsets balance each other out? Will a business relationship ruin your current relationship/friendship? Make sure to ask all the tough questions because choosing the wrong partner, if you even decide to have one at all, can have negative consequences.
Step 9. Name Your Business
Coming up with the perfect business name can be hard, especially if you want a .com domain to go along with it. You can use a free business name generator to help you come up with a name.
Most brands try to include their keyword in the brand name, such as Fashion Nova. However, some brands create a unique name, such as Oberlo.
The business name you choose should be catchy, memorable, easy to spell when heard, have available usernames and a domain, and be concise.
Sometimes the best naming ideas come after bouncing names with a friend as a second opinion helps give you a different perspective. So feel free to get a second opinion if you feel stuck when choosing the right brand name.
Step 10. Register Your Business
In some cities or states, you don’t need to register your business until you’ve earned a set amount of income or profit from it so you’ll need to do your due diligence to see what laws apply for you.
However, some entrepreneurs register their businesses on day one to prevent liability. For example, if you’re incorporated on day one and you get sued in the early stages of your business, your business takes the hit instead of you. So, the sooner you incorporate your business, the safer you (personally) are from a legal perspective.
Of course, incorporation isn’t the only business model. You can also choose to become a sole proprietor or create a partnership business. You’ll need to do some research prior to starting a business to determine which business model is best for your situation.
Step 11. Create Your First Product or Service
There are a number of products or services you can create to sell to your audience when starting a business.
In e-commerce, you can use Oberlo to choose from millions of products that you can sell from any popular niche such as fashion, jewelry, home decor, automotive, beauty, electronics, and more.
If you’re an industry expert, you can create digital products such as ebooks, courses, music, or other digital content to sell to others. You can monetize your expertise with products and upsell with services.
As for software businesses, you can create a SAAS product that helps other businesses. Or if you’re a consultant, you can offer speaking gigs, coaching, or your skillset.
The products you create for your business will depend heavily on your skillset and business type. However, there are countless products that can be ordered or created that you can sell to an audience.
Step 12. Promote Your Business
The most important part of starting a business is the promotion stage. Getting your business in front of people will help you generate sales so that your idea turns into a business. Here are a few ways you can promote your business idea:
- Facebook: You can run Facebook Ads by going after “broad” interests and including relevant brands as an interest to capture their audience. You can also post in Facebook groups as your fan page which is great for businesses with niche audiences.
- Instagram: Grow your Instagram followers so you can make sales with each Instagram post. You can also add direct links in Instagram Stories to capture more sales.
- Pinterest: Group boards are a great way to get visibility on your posts when you’re starting out. You can also create your own boards to promote your content on. Be sure to promote other brand’s content to avoid triggering your account as spam.
- LinkedIn: Build your personal brand by creating posts and sharing thoughts on articles on LinkedIn. Invite relevant users to follow you to increase your reach.
- SEO: By optimizing your website for search and creating blog content you can generate more leads, email subscribers, and website traffic.
- Quora: Answer niche questions on Quora to promote your website. You can use SEO tools to find high-ranked Quora keywords to help increase your visibility on the platform.
Additional Resources to Start a Business
Starting a business is no small feat. You need a lot of courage, creativity, motivation, and so much more, to take the leap. So here are some additional Oberlo resources that will help you start a business in 2020:
Reasons to Start a Business: Looking for reasons to start a business? We asked entrepreneurs why they started a business and they gave us answers so real you wouldn’t believe it!
How to Find Time to Start a Successful Side Business: Not ready to dive head-first into a full time business? We share our time-saving secrets that you can try through starting a side business before you move onto your full time idea.
30+ Small Business Ideas That’ll Make You Money in 2020: Want to start an ecommerce store but not sure what to sell? These small business ideas are perfect for new entrepreneurs who are looking to get their startup off the ground.
What’s Your Motivation? 11 Merchants Share Their Reasons for Starting a Business: Worried about starting a business? There are many different reasons for starting a business and your motivation might be totally different to others. Whatever your reason, it’s important to stay inspired throughout the entrepreneurial journey. We talked to 11 successful merchants and discovered their reason for starting a business to help you.
Realistic Dropshipping Budgets for 2020: Our top performing YouTube video walks you through how, working with Oberlo and Shopify, you can set up a dropshipping business that will be low risk, and low cost.
Now that you know how to start a business, there’s an exciting adventure of creating one that awaits you. Pushing yourself to finally take life by the horns and take that first step can be a bit scary. But once you get started you realize that the process of starting a business can be pretty fun. There will be challenges and roadblocks along the way but as long as you push ahead and learn from mistakes there’s nothing that’ll block your success. All you need to do now is take that first step and you’re well on your way to starting a business.
Want to Learn More?
- How to Start a Dropshipping Business
- 30+ Business Ideas That’ll Make You Money
- 25 Free Business Name Generators to Find the Best Brand Names
- What is Dropshipping?
The post How to Start a Business: A Guide to Starting a Business appeared first on Oberlo.