One of the hardest things about starting a business is, well, just getting started. Here's a checklist to help you organize and prioritize.
Research your market:
You've been working at a sideline — more of a hobby, really — for years. Now you're finally ready to quit your day job and pursue it as a full-time business. Before you take that plunge, here's what you need to explore:
- What is your target market?
- Is your target market large enough? Are enough people interested in paying for your product or service for you to make a viable living?
- Who is your competition? What can you do better than they do?
Write a business plan:
As this article suggests, your business plan doesn't have to be elaborate — nor will it ever truly be finished. Still, in order for you to get started, it should include the following:
- A basic timeline
- Estimated startup costs, including for equipment and office space
- Potential funding sources
- Strategic planning and differentiators
- An exit strategy
Choose a name:
Your company name should be simple and memorable while conveying some idea of what you do. And it should have a long shelf life. (The second "T" in AT&T originally stood for telegraph.) Once you settle on one you like, you'll need to:
- Make sure the name is available.
- Register it with the appropriate government agencies. (Note: You might want to hold off on this step until you complete the next one.)
Before you earn your first dollar:
You need to determine a basic infrastructure for your business, including your tax status and banking procedures. That means you'll have to:
- Decide which entity best suits your prospective business — sole proprietorship, limited liability company, etc. You should consult an attorney before deciding. (Note: This completes the naming process you started above, so you can add the appropriate designation, such as LLC, to your name when you register it.)
- Open a separate bank account for your business and keep it separate for the reasons explained here.
- Set up your systems, including bookkeeping, time tracking and invoicing. You should consult a CPA early on in this process.
Brush up on bookkeeping:
If you don't keep track of the money that's flowing into and out of your business, you won't be successful. It's that simple. You could also end up in trouble with the IRS. You especially need to be vigilant about:
- Doing your bookkeeping on a monthly basis
- Understanding the importance of various financial reports, such as income statements and balance sheets
- Maintaining adequate cash flow to keep your business afloat
- Learning your key performance indicators
Call in experts:
By now you might be starting to fret because you realize there's a lot involved in running a business — including many specialties that you know little or nothing about. Fortunately, help is available in the form of outsourcing. Here are a few possibilities:
- Website developers
- Certified Public Accountants
- Providers of back-office support
Starting a business is a lot of work. But if you can make it succeed, it's incredibly satisfying.
Supporting Strategies’ Resources for Entrepreneurs