You’ve had a flash of inspiration and have come up with a world-beating business idea. Or you’ve been mulling over an idea for a while, and you’re thinking of taking the next steps. Either way, knowing how to start a small business isn’t as easy as the internet seems to suggest.
Countless online articles claim to show you how to start a small business in just a few steps, but it’s not quite as easy as that. There’s work to be done, no matter what kind of business you hope to launch. So here’s our look at how to start a small business, covering everything from having the perfect business idea to accounting advice for small businesses.
The big idea
The fact is, it’s never been easier to launch a new business. If you’ve got the budget and an idea, you could be up and running faster than you ever thought possible. Living in an incredibly connected world means that you can launch a new business entirely online, and you may never have to meet an investor, hire a team or struggle with a brick and mortar store or office.
Now, you still need that idea. But it doesn’t have to be fully formulated just yet. If you’re in the “mulling it over” stage, start writing down those thoughts. Remember, you don’t have to come up with a business idea that’s 100% original. You simply need a unique approach to it that other businesses don’t have.
The business plan
One of the biggest mistakes made by new businesses is not understanding the value of a business plan. For older generations, in particular, the idea of a business plan is simply to hand it to investors or bank representatives when you’re looking for a business loan. But a business plan can be one of your most useful assets.
A well-developed business plan has many sections that will help you identify everything you need to know about the future of your business. It involves mission statements, identifying your brand’s core values and extensive research into your target audience and competitors. Not only will this roadmap give you actionable steps to follow, but it can also be used to clarify your thoughts and ideas.
Never treat your business plan as a static document. Keep it close, and regularly check and update it. A flexible business model that can adapt to change quickly will always be more likely to survive than a brand that’s set in its ways. Update company goals as you meet them, fine-tune your target audience research and always have a running observation of your competitors.
One of the big barriers to starting a business is money. However, even if your budget is tight, there are options. Many new startups are moving forward and attracting investors even when they’re “bootstrapping” (which means launching a business with very little or no funds).
It can be hard work to bootstrap a business and will involve creative solutions because you can’t spray a money hose at them. Ideally, you want access to some kind of funding or investment. For most people, that means heading to your bank (online or in-person) and applying for a business loan. Remember that banks are hesitant to just hand out cash, so you’ll need a robust business plan and the other things your bank manager wants to see.
The alternative to a traditional business loan from your bank is to find investors. There are lots of ways to find people willing to invest in your business idea. Some people ask their friends and family for a loan or some capital in exchange for a percentage of the business. Others will seek out angel investors looking for ways to grow their wealth.
If you decide to hunt down potential investors, there are sites available that make it easy for investors and business owners to connect. They act a bit like social media for entrepreneurs. Remember that if you are looking for any kind of investor, they will want to see your business plan and review your cash flow forecast extensively.
Streamlining your business
You’ve got funding, and you’ve launched your business. While that’s great news, and you should feel proud of your achievement, now it’s time for the hard work to begin. If you don’t want your business to be one of the many that fail every year, you need to roll up your sleeves and start looking closely at every aspect of your business.
At this stage, you don’t want to think too much about growing your business. Instead, you need to fine-tune it so that everything is as efficient as possible. One of the most popular ways to do this is through the 10 Types of Innovation framework. While this isn’t your only option, it’s fast becoming one of the most popular business methods for making improvements.
When your internal and external communications are seamless, your product performance can’t be beaten, and your brand experience keeps bringing in more customers, only then can you start thinking about scaling your business up.
Always try to find ways to improve every aspect of your business. Look for accounting advice for small businesses that can up your finances, find automation tools to cut down on wasted time and boost your productivity, and use the latest cloud software so that you and your team can work from wherever your day takes you. Technology has made streamlining a business easier, but you’re still going to have to put the work in.
Growth through marketing
While you should be doing some form of marketing long before the official launch of your business, now it’s time to take it to the next level. The problem is that marketing is such a massive, sprawling, ever-evolving practice that it can be hard to know where to start. Mistakes in marketing can have dramatic long-term effects on the future of your business, so don’t rush into your marketing strategies blindly.
Take the time to learn some basics of digital marketing while understanding that traditional marketing methods still have plenty of value. While there are plenty of benefits to good marketing strategies, it can be such a massive undertaking that it’s easy to keep putting off. If you’re unwilling or unable to learn more about how to use marketing to grow your business (and your profits), then you’ll need to hire or outsource some of the main responsibilities.
Start your small business
While it’s not quite as easy to launch a business as people often assume, it’s not the challenge that many assume it’s going to be either. Thanks to the countless resources available for entrepreneurs, and the connected world we live in, you have a lot of tools at your disposal.
So it’s not that knowing how to start a small business is easy or hard. It’s more that if you don’t work with a focus on the future, your business is simply more likely to fail.
Take your time to get everything right, and your business could be spanning the globe before you know it. Remember that if you need accounting advice for small businesses, you can contact the team at Big Red Cloud today and find out more about how we can help make your bookkeeping and finances a stress-free process.