You had a dream from a young age to be your own boss. The thought of working for someone else never had that appeal to you. And now, as a young adult, you feel it is time to take that bold step into entrepreneurship. Good for you. Not many people are confident enough to pursue their dreams.
You may not know that so many people have the same aspirations. Research shows that every year, enterprising individuals create about 305 million startups. 472 million is the number of entrepreneurs in the world.
There is no limit to the self-employed talent pool. You can find business lawyers, landscapers, beauticians, food truck owners, and more. On a sobering note, though, as many as 90% of startups will fail.
So how can you avoid contributing to such statistics? Well, it all comes down to planning and covering the basics of setting up a business startup.
Business Startup: Things to Consider
Start With Thorough Research
Setting up a startup is not as simple as opening up a physical location or eCommerce platform and hoping customers come in. Proper research is critical for:-
- The market to see how you will plug in. for instance, are there existing gaps that you can provide a solution to with your goods or services
- Competitor research to know what you are up against. If there is an oversaturation of the area you want to go into, you will find it tough to break through. Unless, of course, you have something unique to offer
- SWOT analysis gives you a clear picture of the reality of opening a business in that particular market.
- Audience research for a good understanding of your target audience.
Construct Business Structure with Help from Business Startup Lawyers
What type of structure do you want your startup to have? The options are:-
- Sole proprietorship
- Limited liability Company (LLC)
For this part, it is vital to consult business lawyers for advice. You should know that each type has different legal and statutory obligations that you must adhere to. Let’s say you have your heart set on an LLC. In that case, you will need a Federal Employer Identification Number (FEIN). This is critical because you must have it to open a business bank account or even process payroll.
The business lawyer will also give critical advice on issues like taxation. Lack of compliance can land you serious problems. You could face severe penalties if you don’t give unto Caesar what belongs to him.
Also, if you run into legal issues concerning your startup, it helps to have a team of competent business attorneys to help you out.
Work On Your Business Plan
Your business plan is like a blueprint that will guide all your activities. The insights from step one above will prove especially helpful. It should highlight:-
- The business summary
- Your mission, vision, and business proposition
- Market, competitor, and audience research
- Service and product description
- Marketing and sales strategy
- Financial plans
There are tons of online resources you can use to help you with this part. But you should also seek advice from a business lawyer for some areas.
Please note the business plan is a living document. That means you can update it as need be.
Decide On the Source of Capital for the Startup
You must have enough capital before setting up your startup. Remember, it will take time before you start seeing a return on investment. Yet, you will still need money for the logistical and day-to-day expenses.
Sit down and devise a checklist of everything you may need to launch the business. Please include assets, lease payments, staffing, and operating expenses. Ensure that the inventory is as detailed as possible.
You may think it is unnecessary to put smaller items like office stationery. Yet, they do take up a significant amount of cash. Also, make sure you put a dollar amount to each item. Once again, you have tons of resources you can use for this.
Next, determine where the capital will come from. You can use this if you have enough money set aside in savings. Family or friends can help you out by extending loans to you. You only need to ensure that you pay back the money. Otherwise, you could damage relationships forever.
A better alternative would be to seek funding from lending institutions, angel investors, or venture capitalists. But, you must prove the viability of your business idea. That is why it helps to have a solid business plan.
Decide On a Suitable Business Location
Are you planning to have a physical location for your business? With e-commerce platforms, running a startup without brick-and-mortar establishments is possible. But it depends on the type of business you are setting up. Even if you’re running an e-commerce platform, you may still need warehousing facilities to hold the stock.
Location is critical because it will have a significant impact on how your customers reach you. Start sourcing for a safe, accessible site with parking facilities. Convenience is a crucial factor if you want to attract customers.
Prepare for Risk
It would be unrealistic to think there is no risk when setting up your startup. Take time to calculate, understand and plan scenarios. This point further emphasizes the need for Due attention to point number one of market research.
The SWOT analysis will help you understand the threats and weaknesses in the business environment. You place yourself in a better position to deal with any risks.
Preparing for risk also means taking preemptive measures like getting business insurance. Professional liability insurance can cover expenses if a client decides to sue the business. General liability will cover things like accidents at the workplace and more.
Learn From the Experts
Do seek advice from mentors or people who have found success as entrepreneurs. You will get a clear picture of what you can expect and how to navigate the startup environment better.
Avoid a lot of disappointment by networking with professionals. Do take time to attend industry events and actively seek out professionals in your industry. It also doesn’t hurt to hire a business coach to teach you a few things.
Don’t go into setting up a startup blindly. Planning is critical to have a sound foundation upon which to build the business. We have shared some essential steps to make sure you cover the basics.
Have on your team professionals who can guide you on the right path. These include business lawyers, mentors, business coaches, financial advisors, and more. Good luck on your entrepreneurial journey.