How to Start a Small Business

Write a business plan. A business plan helps determine what you need to promote your company out, big or small. It also sums up the meaning of your business in one page. It creates a general outline for investors, banks and other parties to use to decide how they can best help you and decide if your project is OK.

Write a business description. Describe your business in more detail and describe how it fits into the market. If your company is a joint stock, limited liability company or one-member enterprise, explain why you chose that direction. Describe your product, its salient features, and why customers need it. Please answer the following questions:

• Who are the potential customers? Once you understand who they are and what they want, you can build a marketing strategy.
• What price are customers willing to pay for your products and services?
• Who are your competitors? Do a competitive analysis to identify your main competitors. Find out who is doing the same thing as you and how successful they are. It is also important to find out what causes their failure and what causes their business to fail.

Write an action plan. This plan will describe how you will produce or deliver the product or service and the costs involved.

• How will you create the product? Is it an existing service or if it is more complex like software, for example, a tangible product like a toy or toaster – whatever it is, how will it be made? Build the process, from raw materials to assembly, packaging, storage and shipping. Do you need to hire more people? Are unions involved? All of these factors need to be included in the plan.
• Who will lead and who will follow? Define the company’s organization, from the front desk clerk to the CEO, and the roles of each, including functions and compensation policies. Knowing your organizational structure will help you plan your operating expenses and capital adjustments needed to operate effectively.
• Receive feedback. Friends and family are great sources for you to ask questions and get feedback. Don’t hesitate to ask and listen to their suggestions.
• Need to increase the size of your business premises? This happens more often than you intended! Once the goods start to pile up, you may have to store them in the living room, bedroom or garden. Think about renting warehouse space if necessary.

Make a marketing plan. The operational plan should describe how you will manufacture the product, while the marketing plan describes how to sell your product. When planning your marketing, try to answer questions about how you will use it to promote your product to potential customers.

• You will have to include the type of marketing that will be used such as radio advertising, mass media, promotions, billboards, networking events, or all above?
• Define the marketing message. In other words, what will you say to convince customers to choose your product? This means you want to focus on your Outstanding Business Score (also known as the USP). This is the only advantage your product has to solve a customer’s problem. It could be lower costs, faster service, or higher quality than competitors.

Build a pricing model. Let’s start by looking at competitors’ prices. You need to find out how much they sell similar products for. What can you add (value) to make your product more different and more attractively priced?

• Competition is not only about goods and services. It is also about social and environmental responsibility. Customers are increasingly concerned about whether your business is responsible for employees and the environment. Certificates and certificates of merit from prestigious organizations such as titles and star ratings can assure your customers that your products and services are associated with higher value than products that do not. .

Calculate financial metrics. Financial statements translate marketing and operations plans into numbers, profits, and cash flow. They determine how much money you need and how much you can earn. Since this is the most volatile part of the plan, and also the most important for long-term stability, you should update the plan monthly for the first year, quarterly for the second year, and annually thereafter.

• Take into account start-up costs. How are you going to fund your initial business? Funds from banks, start-up funds, venture capitalists, Small business management, savings: they are all reasonable options. When you start a business, be realistic. You won’t be able to start making 100% of what you expect, so you need to have reserves available to keep you afloat until everything runs smoothly. One of the surest ways to failure is lack of capital.
• At what price are you going to sell your product or service? What is the production cost? Estimate net profit, taking into account fixed costs like rent, utilities, labor, etc.

Build an overview summary. The first part of a business plan is always a summary. Once you have developed the other sections, describe the general business idea, how the company will make money, how much capital you will need, current position including legal situation, people involved and Brief history and anything that makes your company look like a success statement.

Build a product or develop a service? Once every business strategy is planned, finances are calculated, basic personnel is set up, let’s get started. Whether it’s working with engineers or coding and testing software, or sourcing materials and shipping them to the factory, or bulk purchasing and pricing, the build process is the amount of time you are preparing to bring the product to market. During this time, you may notice the following:

• It is necessary to edit the ideas. Perhaps your products will be more appealing if they come in different colors, textures, or sizes. Perhaps your service needs to be scaled up, narrowed down, or more granular. This is the time to focus on whatever comes up during the testing and development period. You’ll obviously notice something that needs tweaking to perfect or cut out in the sense of a competitor.

Guaranteed start-up costs. Almost every business needs capital to get started. Money is often needed to buy supplies and equipment, and to keep the business running in the period prior to profitability. The first source of finance usually comes from yourself. ^[1] .

• Do you have any investments or savings? If so, consider using some of your savings to invest in your business. However, you should never invest all of your savings in a business in case it fails. Plus, you shouldn’t invest your emergency savings (experts recommend having 3-6 months of income set aside for this purpose), or money you’ll need. for the next few years for other obligations.
• Consider a home loan. If you own a home, finding a way to get a home loan can be a good idea, as the loan is often easily approved (since your home acts as collateral), and interest rates are usually lower as well.
• If you have a 401(k) savings plan through your employer, consider borrowing from the plan. Plans typically allow you to borrow up to 50% of your account balance for a maximum of $50,000 (applies in the US).
• Think of saving first as another measure. If you have a job, save a portion of your monthly income over time to cover startup costs.
• Ask for a small loan at the bank. If you follow this method, consult as many banks as possible to choose the lowest interest rate.

Control your operating costs. Pay close attention to your operating costs and make sure they fit into your plan. Whenever you see wasteful spending like electricity, phones, stationery, packaging, look around and estimate how much you really need to reduce it to a minimum or eliminate it if possible. . Be frugal when you start a business, including renting instead of buying; Use prepaid plans for the services your company needs instead of binding yourself to long-term contracts.

Be prepared to spend more than the minimum. You may think that it only takes 50 million to start a business and it is also true. You need 50 million VND to buy furniture, printer and raw materials in the first month, and the second month comes, you are still in production but the rent is due and the employees want to be paid and All bills to pay come at once. When this happens, you will pray to get it done soon. So if possible, reserve money for a year in a scenario where you don’t generate any income that year.

Save every penny. Plan to keep your office supplies and overhead costs to a minimum when you start. You don’t need shiny office supplies, latest tech chairs, and expensive paintings on the wall. A small cabinet is enough if you invite your guests to the cafe every time you meet (meet them in the break room). Many cases of a start-up company fail just because they buy a lot of expensive gadgets instead of focusing on the business.

Select payment method. You need to find out the appropriate type to receive payments from customers. You can use a program like Square, which is great for small businesses because it requires very little paperwork and fees are low. However, if you don’t like using a lot of technology, you can still use the traditional method of opening a business account at the bank.

• A business account opened at a bank is a contract in which the bank provides a line of credit to a business who wishes to accept payment for transactions via a card of a certain card institution. Previously, without this contract the business could not receive payments from any major credit card institution. However, the Square app has changed that, so don’t be constrained by this traditional option. Learn more and familiarize yourself with new technology.
• Square is a card swiping device that connects to a smartphone or tablet and turns it into a payment machine. You may come across these devices in your regular business as they are increasingly common in cafes, restaurants, street food stalls and other types of businesses (look out for a card). postage stamp-sized plastic that plugs into a smart phone or tablet).
• Please note that all forms of payment such as Paypal, Intuit, and Amazon offer the same solution. Be sure to consider all options before deciding.
• If you have an online business, Paypal is a great payment service for receiving and transferring money.

Consider finding an agent or legal counsel. It will be difficult when you go from employee to owner of a small business that is often overworked but does not get paid. Some of the difficulties include the pile of documents on regulatory laws, from contracts to city regulations, local government permits, city/province requirements, taxes, fees, contracts, shares, partnerships and more. You will feel more secure when you can call someone for advice on problems that arise and this is also an essential resource to help your plan succeed.

• Make “choice” of the right people and they must know your business. You’ll want someone with experience in this area because a less-experienced lawyer can land you in legal trouble, pay fines or even go to jail.

Looking for an accountant. You need someone who has a knack for handling finances, but if you can manage your own books, you still need someone who understands the tax aspects of running a business. Tax accounting can be very complicated and you will need (at a minimum) a tax consultant. Again, it doesn’t matter how much money they manage for you, but the person has to be trustworthy.

Establishment of a corporate legal entity. You will need to know which type of entity helps you to pay the least taxes and to attract investors. Once you have determined whether you will raise capital from your own capital or from other people or borrowed capital, with consultation from tax and legal experts, you will know the type of legal entity that is right for your business. his career. This is one of the last steps to take before you actually put money into it or call someone else to invest. Most people are familiar with the partnership model, limited liability company, etc., but for most small business owners, you should consider starting a company in one of the following ways ^[2] :

• Sole proprietorship, if you will do this business by yourself or with your spouse (no employees).
• A partnership if you will be doing business with a partner.
• A limited partnership (LP), created between a few general partners who have (unlimited) liability for matters related to the company, and a few limited partners who will only be liable ( limited) in the amount of capital they invest in the company. All share the company’s profit and loss.
• A limited liability partnership (LLP), in which no member is liable for another member’s mistakes (protects innocent members from the negligence of another).

Build a website. If you’re selling online, get your ecommerce strategy ready and build a website or outsource. This is your facade so anything and everything you can make customers want to visit, and want to stay, go for it.

• Similarly, if your company is focused on a “person-to-person” interactive experience, traditional marketing will be important. For example, if you are starting a real estate business, focus on word-of-mouth marketing to your neighbors before opening a website.
• When creating a website, keep in mind that simplicity and clarity are essential. A simple design that clearly articulates what you do, how you do it, and the cost of the product works best. For your website, remember to emphasize why your business is the best solution to your customer’s problem.

Hire a professional designer. If you decide to make a website, do it professionally. Design costs will be expensive at first, but a well-presented and reliable website is essential. It needs to look professional and be simple to operate. If you plan to have both trading/payment features on this site, invest in secure encryption and thoroughly check that your money transfers to companies are reasonable and reliable.

Discover your inner salesman. You may be very confident in your product or service, but to be successful, people must also believe in you. If you’re new to advertising or marketing or you hate sales, it’s time to overcome those hurdles and develop your sales skills. You need to create a compelling pitch to convince customers that they need your product or service, and that it also represents the value, purpose, and potential that your company offers. Write your pitch in multiple ways until you find the best one and you’re always ready to speak up. Then practice masterfully!

• Depending on your business, you may need attractive, eye-catching business cards.

Take the time to grow on social media. This can be done before starting a business to increase attention. Use Facebook, Google+ and Twitter, and any other social networks you believe can build interest and promote. You may want to build curiosity and people will follow your progress. (Be sure to choose a business account for your company and separate it from your personal account. Your message should also be relevant to different audiences depending on the type of account you’re using. .)

Implement marketing and distribution plans. Once your product or service is complete, it’s time to sell and start marketing.

• If you plan to advertise periodically, they will need copy or images at least two months before publication.
• If you sell in stores, sell pre-orders and set up a booth. If you sell online, be prepared to have your website up and running.
• If you are a service provider, advertise in specialized magazines, newspapers and online as appropriate.

Secure workspace. Whether it’s an office or a warehouse, if you need more space than your bedroom, it’s time to do it.

• If you don’t need an extra office outside of your home, but do need a place to meet your partners from time to time, there are often locations that can solve this problem. A quick Google search for “rent a meeting place in [province/city]” will give you plenty of options.
• Be sure to contact your local authority to find out about zoning laws. Some types of small businesses cannot be run in cramped quarters, and it’s important to make sure your business is operating in the right area.