Steps to Open a Small Business

Written By Steps To Faculty Published September 18th, 2010

Starting your own business is an exciting venture into unknown territory. Unfortunately, many small business ventures end in disaster, mainly due to a lack of proper planning. If you are thinking of opening your own business, you can avoid failure and get ready to open by following these 5 simple steps.

Step 1. Research and plan your business carefully.

No matter what your product or target audience is, research thoroughly before you get started. Perform as much market research as you possibly can – this will be part of your market analysis in your business plan. You will also need to include a description of your company, management structure, product or service, and plans for funding. This is the foundation of your business, so do not neglect it!

Step 2. Choose a location for your business.

Check with your city to determine zoning requirements if your prospective location is outside your home. Even if you are working from home, you may have to comply with zoning or business license requirements, so checking before you start is a good idea. Remember that location is part of the keys to your success.

Step 3. Raise capital.

Unless you are starting a very inexpensive online business, you will need to have enough money to get your business rolling. If you need financial backing, now is the time to write your pitch. You can show potential investors the business plan you wrote in step one – it should have a brief description of your estimated expenses. Remember that starting your own business means you will not be profitable right when you start.

Step 4. Figure out your business structure.

Are you planning to have a sole proprietorship, partnership, LLC (limited-liability company), corporation, or “S” corporation? Each structure will have different regulations, taxation requirements, and liability. Although starting your own business as a sole proprietorship is extremely common, remember that if you do so you put your personal assets on the line.

Step 5. Hire or consult an account.

Although it may be tempting to do your own bookkeeping, a good accountant can help you work through your taxes as well as assist you with your record keeping. Talk to an accountant if you have no idea where to get started. He or she can help you set up a system that will keep you on track.

Get all the permits and licenses you need to operate. If you researched your location and zoning requirements in step two, you might have already talked to someone about which permits you need to operate. Now is the time to learn whether you need permits (like some contractors) or licenses. Remember even if you are starting your own business from your home, some states may require you to get a business license. Once you have all the paperwork done, you’ll be almost ready to set up shop!
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Roger Due

Investing in Your Destiny® & Coaching Program - Wealth Building Summit Dallas, Texas

My name is Roger Due and I am from Albuquerque, New Mexico and I am the owner of the Monsano software company. This has been an absolutely fantastic conference. This is the best I have ever been to.