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Steps to Starting Your Own Business

Introduction:

Thinking of starting a business? My hat is off to you, and I hope that this blog can provide resources for you to get started. Since my retirement from industry six years ago, I have been a SCORE volunteer (Service Corps of Retired Executives). Over these years I have met many clients who dream of starting their own business. Their motivation to start a business may vary, but their common goal is a desire to be successful and to be their own boss. My experience has imparted to me a good sense of those who will be successful and those who will not be successful. It is those people who are prepared and have a strong urge that are successful. From my training and experiences I have prepared a suggested road map to start your own business. Do take advantage of your local SCORE volunteer while planning for your business. The service is free and the volunteer can be found through your local Chamber of Commerce.

The Business Idea

The idea to start your own business can come from many sources: your hobby, your work experience, your desire or a situation you found where a service was not being met. To confirm that you have a sound plan you have to:

- Describe the business in a paragraph or less.

- Decide if the product or service is unique… cheaper or faster, etc.?

- Decide whether this business meets your personal goals?

- Commit to investing many hours to make your business successful?

There are many other questions that you will need to answer truthfully to yourself and then discuss them with your spouse and close friends. Once you are comfortable with the answers then you are ready to proceed to the next steps. The Small Business Administration has a full list of questions to help fulfill this part of the journey.

Above all, your business has to “solve your client’s problem”. It is this objective that makes a business successful. If this main objective is met, then all your other needs can be fulfilled.

Start Preparing for Your Business Plan:

You need to do some basic work before you prepare your business plan.

Finding a Business Name:

You need to derive a business name that represents your dream of a business yet does not infringe on another business. Your State’s Secretary of State can readily tell you if you have a unique name. You will find that this is important as you get deeper into your business plan. Try to derive the most attractive name you can identify.

Finding a Potential Location:

Is your business going to be a storefront, web site, home or perhaps out of a van business? Inputs to your business plan will require lease or rental expenses, insurance and other facility expenses. Just as importantly, you will have to determine the traffic past your selected location and how many potential customers your business will attract. The more attractive locations will attract more business but will be more expensive. A local commercial real estate agent is of great value to help you with this decision.

You need a Logo:

I believe that all businesses should have a logo. It will be added to checks, business cards, literature and other materials. In my opinion, it brings the business together. The logo will be used on business cards, letter heads, web sites and all other forms of advertisement. Take a look at http://www.logomaker.com/index.html for a very reasonable logo design.

Business Structure:

You need to decide on your legal business structure. The options are:

Sole Proprietorship

C Corporation

S Corporation

Partnership

Limited Liability Corporation (LLC)

For the majority of my clients, the Limited Liability Corporation is the best fit. For a reasonable fee you can have a business entity that has limited liability for business debts, which protects your personal properties. You can form the LLC with your State’s Secretary of State.
A good Web Site to review the four business structures is: http://www.quickmba.com/law/org/

Employer ID Numbers (EINs):

You should get an Employer ID Number (EIN) from the Federal Government. The number is issued by the IRS and it is free. http://www.irs.gov/. At the minimum this will save your using your Social Security Number for identification. The IRS site has lots of good information on small businesses that can be of benefit to you.

Write Your Business Plan:

The business plan is the most important document for starting your business. The Small Business Administration has a template that you can use to write the business plan. http://www.sba.gov
The business plan document should have the objectives of the business, its structure and it financial road map. This document will always be used to keep all participants on the same road map. It is the most laborious yet important document you will derive. This document should be reviewed by your spouse, good friends, and SCORE Counselor. A good web site to find samples of business plans is http://www.bplans.com/. This site shows examples of successful business plans and also has good information for starting a business.

Again, I must emphasis thatyou need to keep the overall objective of “What Problem am I solving for the Client” in front of you. If you fulfill this objective the rest will fill in.

Financing:

You have finished the business plan and now will decide if you need financing to start your business. How much do you need? Most of the clients that I see can actually finance their business with a credit card. They need a financial record of 650 or better to get a card and probably can use the card for up to $10, 000.00 financing. Perhaps you can provide money from your savings or take in a financial partner.

If you require more money to finance your business, prepare for battle. The banks are tough and you are competing for time with people who will be doing much larger business with the bank.
This is what you will need:

A polished business plan

A list of start-up costs

Past three year personal tax returns.

A statement of personal histories

Credit reports from Equifax (1-800-658-1111), Experian (1-800-682-7654) and Tran Union(1-316-636-6100)

Be prepared to answer all questions on your finances and needs. Be prepared to show that you are conservative in your plan. Seek out used or rental equipment or other innovative techniques to save money. You should remember that the banker is usually interested in helping start a small business if they have a strong plan and collateral. You have to be prepared because his or her time is limited.

Further Steps for Success:

Hopefully, you will make it through these hurdles and be ready to open your business. You are to be congratulated because this is a great accomplishment. You are your own boss and in charge of your future. Do not celebrate too much for now, though, as you still have to hire employees, choose the technology you require for running your business and wade through many other details. May it be rewarding and profitable.

Networking For The 21st Century Home Based Business

The home based business has exploded in recent years because more and more people are getting out of the mind set of staying with the same company for thirty years and retiring. The new generation of business minded people don’t want to waste their talents to make someone else the big profits-but instead want to line their own pockets from talents they have obtained. This is an exciting period in the business cycle when individuals break down the barriers to achieve their own success. With that said how exactly would a new business obtain a network it needs to survive in today’s marketplace?

With most new small businesses being home based start-ups.It’s important that these businesses build a solid network of contacts that can help sell the business for you. Networking can provide invaluable business opportunities for sales that otherwise would cost the business thousands of dollars in advertising dollars to obtain. Some of the ways to start building a solid network utilizes two very important but equal strategies. If you follow these two strategies your almost assured that a solid network of business contacts can be achieved.

The first approach is what I call the “Street” plan of attack. This strategy consists of the old way of doing networking. After all you don’t want to stop doing something that has proven to work time and time again. What a small business owner must realize right off the bat- they must get out there and meet people if the business has any prayer of getting off the ground. If you are a shy or timid person it’s time to get over that fear or your new business will never get off the ground. The market place is really for those that are strong and determined-all being timid will do for your business make you broke.

With that said the very first thing you should do as a new business owner is to join your professions networking group. If your in real estate- then it would be advisable to join some investment groups or attend your Realtor associations events. After all Realtors pay big money to be apart of the national and local associations so why not utilize it to your advantage. The next step in networking on the ground would be for you to get involved in your community. Nothing brings more interest in your business then socializing with people within your community. Join the local chamber of commerce and attend the event meetings they have once a month. Join the different boards within the commerce to let people know who you are, volunteer for events that your commerce organization is having. Another good place to pick up contacts is by joining social organizations like the Elks or Moose- Lyons club or Rotary. These social organizations are usually national and can go a long way in building contacts outside your local area. Again just don’t join to say you joined- get out there and be active within the organizations.

The second approach to use is through the internets-many great social networking sites exist right now that can give you great results if used correctly. Myspace and Facebook can bring your business a treasure trove of business- even presidential candidates are utilizing these sites to bring in contributions and votes. Although the new internet can be a blessing to your business efforts. A business owner must recognize how to be effective in using them. Most people in business think that you sign up for an account and just start requesting as many friends as possible. This is the deadly sin as I call it for anyone truly wanting to build a network for their business. Again let’s take real estate for an example. Your a Realtor and want to build a good network of people that can help you grow your business.

As a real estate professional you want to build a network by getting other people who know your business and can give you referrals. Thus in starting your network you want to do a search for all those profiles that are Realtors and making a friend request. After you complete that you want to move onto mortgage lenders and maybe business brokers- anyone that can help you build your business base. Once you build your base then you start requesting people in your geographic area that might be interested in your services. But remember you want to build relationships and not just spam people with your services. If thats your goals then you will fail period. People like doing business with someone they think they know- if you communicate through emails or comments then you start to build that relationship. Remember if done right this tool can take you a long way in bringing you business that can be repeat as well as building a solid business relationship for future deals.

Local Business Search 2.0

The web-world of small business has a handful of very valuable solutions for businesses and consumers alike. The internet has provided many opportunities for local businesses of all types to enhance their business through use of the internet. Businesses of all types us the internet to find customers and make them happy. This article is designed to research some of the ways that small businesses may use existing applications on the internet to enhance their business.

Old fashioned local business directories, or Yellow Pages, were the first websites designed to utilize the internet to improve local business. The internet provided a platform for these local business directories to improve their local search with a keyword search feature, faster search times, and easier directions than traditional paper directories. Since the web has grown, a handful of new websites have emerged that improve the way that people and small businesses interact online.

This article will briefly explore some sites that provide a new-valuable way for local businesses and their customers to interact. Various yellow page websites are the most popular way to find local businesses online; however, this article is designed to explore other websites that people are using to find and support local business.

1. Craigslist – The general public has fallen in love with this free classifieds website. Craigslist provides a great medium for buying, selling, finding jobs, and even finding dates in a local geographic communities. Craigslist receives millions of visits every day and provides its service free of charge, other than posts for employer job openings. A section on Cragslist is dedicated to ‘Services’ and many small and home based businesses use this to promote their business. Users are allowed to post information promoting their business once every 48 hours, although many businesses find ways to repost within this timeframe. The postings will stay online for up to 7 days, but they get the most attention when they are at the top of the list or right after they are posted. The main benefit of Craigslist is how quickly people can reach a number of interested consumers in their area. Some shortcomings of Craigslist are that business listings expire, and to reach customers businesses must re-list several times a day to generate more sales leads. Also, there is no quality assurance with Craigslist. There is no easy way to check the legitimacy or quality of the businesses that are listed on Craigslist.

2. MoreWorld – MoreWorld takes great web 2.0 technology and delivers it to small businesses, home based businesses, and their customers in an attractive and easy to use package. Businesses enjoy free registration and highly customizable company accounts. This includes a free business website, a complete menu of products and services and free inclusion in MoreWorld’s local search. Businesses may even use MoreWorld to manage a list of their customers and employees and send out group emails. MoreWorld also provides a comprehensive local search for companies, products and services. Users can also browse companies by category. Search results provide pricing details and customer feedback information. The most exciting part is that when a user views more details on a company, they get far more information than is available in traditional yellow pages. They get a detailed description of the company by the company, including a detailed description of the company’s products, services and prices. The greatest drawback to MoreWorld is that they only have information on company’s who have registered with the site.

3. Yelp – Yelp has found success by integrating social networking with a site designed for rating local businesses. Yelp provides a fun, easy and addictive platform for users to create and submit reviews on many types of local businesses. Further, all of the services available on Yelp are free, other than the sponsored search results for businesses. Users interested in finding a product or service may search or browse listings by distance and star rating as well as several other search areas. The website also provides a forum for users to discuss local businesses, events and other things in their area. All of the information on this site is managed and updated by Yelp users. Yelp customer service will review all requests for changes to a business listingso ensure the most accurate information is available. Yelp provides a great way to find detailed reviews on local businesses. The main drawbacks on yelp are the reliability of reviews and the lack of any business side interface. Also check out InsiderPages for another great site based on user reviews.

4. ServiceMagic – ServiceMagic delivers an interesting new approach to the local business front. ServiceMagic provides an attractive and easy to use platform that helps connect consumers to the contractor for their job. Service magic has a simple project description form for people to complete. Once the form is submitted, ServiceMagic matches them with a handful of qualified contractors, and the communications begin. Users may read ratings on different service providers as well as a detailed description provided by the company on themselves. Users seem very happy with the amount of time ServiceMagic saves them in finding the right business for their job. While ServiceMagic is great for finding a contractor it is limited to the types of businesses it can help you find. Another problem is that businesses must pay to be on service magic, so the best business for a job may not be available to the user because that company is not interested in paying. The final drawback is that there is no search feature for users, causing people to be limited to viewing only the companies that ServiceMagic allows.

5. Angie’s List – Angie’s List is another site that aggregates consumer reviews of local businesses, much like Yelp. Angie’s List separates itself from other similar sites in that they charge for membership. This includes charging both to see and write reviews. Angie’s List prides itself on their level of user participation and the credibility of their information. A major benefit to Angie’s list is that companies can’t pay to be on the list, they must be reviewed by a member in order to be listed. Major drawbacks to Angie’s list are that it is not free and that there is no interface for businesses.

There are many great tools available to small businesses and their customers. Weather you are a business owner trying to attract new customers or a consumer trying to find the a businesses, there are sites out there that can help. With the variety available sites there are options available to meet the varying needs and preferences of different businesses and individuals.