6 Tips to Help You Start a Business From Scratch Useful tips for young entrepreneurs looking to to take their ideas from scratch to profitability.
By Pui Ki •
Opinions expressed by Entrepreneur contributors are their own.
The thought of being an entrepreneur and running a successful business is on the wish list of every ambitious and career-oriented person. However, when it comes to laying down the foundation of a business, a lot goes into making it happen. With the advent of technological innovations across industries in recent years, people are aspiring to become top-notch entrepreneurs and they aim to change the dynamics of the business.
Generally, the common notion among aspiring entrepreneurs is that the best time to kickstart your business is when you are in your early 20s. However, this myth seems to have created a lot of pressure on young and hardworking would-be entrepreneurs who want to make a name for themselves in the market.
Interestingly, a research report titled by ScienceDirect suggests that the success ratio of people who set up a business in their 20s is actually the same as for those who become entrepreneurs in their 50s. The research stated that there seems to be balance at play. While the young entrepreneurs tend to be more tech-savvy and reluctant towards taking risks, the older entrepreneurs get an advantage from their vast iexperience, business skills, access to finance and key industry contacts. Meanwhile, the people who are in their 30s and 40s enjoy less success from their ventures due to responsibilities such as family, not being willing to take huge risks, and saving for the rainy days.
Undoubtedly, launching your venture gives you the liberty to execute ideas, make amendments to company policies at any given time, seek more funding from various sources, and create a healthy working environment. Though it may look easy, there are some factors that budding entrepreneurs need to take into consideration before starting a project.
Related: The Most Important First Step When Starting a Business
Research about the business idea
Once an entrepreneur gets a business idea, it is very important to ensure that it is feasable. Market research and assessing your competitors is the key in determining the customers' needs, target region, finance requirements, etc. In addition, this also helps in increasing engagement with your potential customers and building a product that will cater to a large section of society. Moreover, the clarity about budget allocation and funds requirements will also be addressed.
Write down the business plan
As you are launching the business, there will be several targets and goals which you might have thought of when you first conceived of your idea. Successful businesses use this plan as a roadmap to determine which direction the company is moving. In this plan, the most important things are a statement of purpose, market analysis, product descriptions and competitor analysis. These help you to set a clear target for every department and assess the accomplishments over months. Composing a business strategy is significant because it can assist you with settling on more proficient and key choices. It also assists you with zeroing in on your objectives and procedures.
Validate your business officially
Once you have developed the idea and arranged all the resources that have the potential to grow your business, it's time to validate your business on legal grounds. This includes registering your business with your state, securing the right licenses and permits, and getting a tax ID number. This enables you to operate the business without any roadblocks. It will also provide a platform for raising funds in the future and help you create a brand name in the industry.
Watch your finances
This is the most important element when planning the launch of your business. Gathering the right amount of funds is also an uphill task for budding entrepreneurs considering that business loan offers from banks and financial institutions can be limited since your company is new. The need for finance can arise at any given time, so it is very important to evaluate your available financial backing and sources that could be reliable when you need money the most. Every business needs some amount of finance, therefore you need to have clarity about the kind of business which you intend to launch and the reliable sources that can bail you out monetarily during the crisis.
Related: 5 Steps to Building Your Personal Brand From Scratch
Safeguard your business
As it takes a lot of hard work to build a business from scratch, it becomes equally important to protect your venture from any unforeseen incidents. Proper insurance coverage that protects your business property from natural calamity and slander, libel and damage should be your topmost priority. In addition, there are other areas such as professional liability coverage, data breach coverage, commercial property insurance and more which need to be fully protected. This helps businesses to resolve any matter within the proper framework of the law.
Market your business
You can't build your business without having a marketing plan in place. In today's digital age, marketing and media coverage is essential in order to highlight your products or services. A strategic marketing plan coupled with appropriate media coverage can scale up your brand much faster. Promotional activities about the company on popular social media websites, along with features in magazines or digital news portals, is the best way to market your business effectively.
