March 26, 2019
How to Build a Business from Scratch
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You have an idea for a business, but no idea where to start. For many entrepreneurs, this is where their business idea dies.
Not you, though! The fact that you're reading this article is a good start. Learning how to build a business isn't easy, but it's worth the time in the long run.
Ready? Let's make your passion come alive.
Before we get into the steps, take a minute to remind yourself that this will be hard. That's ok. The good things in life take work.
When you come up with the idea for your business, solid or not, figure out why you want to start it.
Is it because you saw a niche market that's underserved and you want to profit? Profit isn't a why; it's a bonus.
Your why is something like, I have this experience and I don't want anyone else to go through it.
Or, I know this helped me and I want to help others. Write yourself a statement about why you need to do this, who it'll help, and how.
Bringing emotionality into business isn't a bad idea, it's an essential one. This is how people stay passionate and don't burn out.
Now that you know how and why you can help someone, come up with your business idea. It doesn't need to be a full plan yet, but you need a concept.
Try to come up with something you can explain in less than two minutes. When you're explaining your company (to yourself or investors) don't use words like "I want".
Instead of saying "I want to start a company", say, "my new company". This shows investors and yourself you're confident in the idea and brings it into the foreseeable future.
Okay, so now it's time for the official stuff, your business plan. If you have no idea where to start, that's ok.
People have laid the groundwork for you. What kind of business are you opening?
Many sites have templates or ideas you can use, for a small fee. Make sure you read through them before you commit. You can change small details, but don't want to reinvent the wheel.
If you're looking at templates, see if there are reviews. Do some quick googling of the names of the reviewers. Where are they now? Did they succeed?
Read the frequently asked questions on the business plan template or the site. This will show you any shortcomings that need to be further explained.
Now it's time to do the big entity stuff. Are you opening an LLC? Each type of corporation has its pros and cons.
Mostly, this is for tax purposes but can affect your future employees.
Will you be the only owner of the business? Can you find a business partner? That tells you whether you have a sole proprietorship or a partnership.
If you don't understand the legal jargon, look it up. Don't be afraid to learn something new, it's all for your future!
Once you have your business plan, your legal logistics, and the passion, ready your funding. If you're starting this business out of pocket, call your bank and open a new account.
Use one account solely for business purposes until you grow large enough to qualify for a business account. This makes it easy for tax tracking down the line.
If you're getting a loan, having a business plan and your ideas together will get you approved easier. Someone is more likely to trust you with their money if you've planned ahead.
Once you have your funding, you need to register your entity. This means telling the government you're a business instead of a person.
If you search your state's site, they should have an articles of incorporationdocument. Fill it out, pay whatever fee it requires, and send it in.
Decide now if you want to trademark your name since the official name will go down in ink.
Once that's done, check with the IRS or your accountant to file any tax forms necessary for state and federal levels and get your Federal EIN.
Business insurance isn't something a lot of us think of and not having it is how people go broke.
Don't open yourself up to failure before you even launch. What if they're building your location and lightning strikes?
What about your employees? States require businesses to have workers compensation insurance and some to have unemployment.
Whatever lawyer you worked with to establish your entity can help with this. Other things to think about are general liability and E&O malpractice-type insurance.
So many times business owners get so excited about the opening, they forget to set money for marketing. Or they don't set aside enough.
Don't let this common pitfall happen to you. Make sure people know who and what you are before you tell them where your location is.
Word of mouth is great, but you'll need Facebook ads or radio time too.
As a successful entrepreneur myself, I'm always asking other successful people questions. Growing a business is dynamic and you can never know too much.
As an entrepreneur, you should always keep learning and sharing your knowledge.
Before you close this article out, sit down and write your why. Even if it's one sentence and it's on the edge of a newspaper nearby.
It'll help you concrete what you've learned in this article and charge up your brain.
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