Big or small, a business brings a lot of responsibility as well as risks with it. Starting a business is not a child’s play. It requires the same amount of hard work as involved in starting a big scale business. As an owner of a small business, you have to face many challenges in various arenas. A small business whether in retail, wholesale, industrial, or manufacturing units, the businessman needs to plan accordingly to achieve the set goals to exist in the competitive market.
Networking: The Foremost Step
Apart from the other steps involved for starting a small business, networking is the foremost step that should be followed. Networking means expanding your network of friends and businessmen that could help you in starting the business. You can expand your network by-
Join the Chamber of commerce of your region. You can benefit from the advice of professionals.
Join a professional networking site generic terms. Through these sites you can become aware of the business world and opportunities beyond your local network.
Benefit from your current circle of friends and family. Talk to them about your new business and seek their advice, if necessary
Starting A Small Business
Starting a small-scale business requires planning, study of the market, and knowing the competition. There are important points one should keep in mind to initially start a small business. These include-
Selecting generic terms and the best opportunity:
Among the various opportunities, you need to select the best opportunity. You can create as well as choose an existing business idea.
Prepare a business plan: After finalizing on the kind of business, the next step is to prepare a well-crafted business plan. You should gain complete knowledge about the market and investment required while preparing the business plan.
Financing: A small business is usually funded through family/friends, banks, and financial institutions. Each of these options need some degree of authority or guarantee over the money that is being lent.
Opting business structure: You need to choose a legal structure for your business. You can run your business as a sole proprietor or can be a part of partnership or Limited Liability Company.
Registration: Business registration involves paperwork, which lays down the different rules, and regulations that are to be followed while commencing it. Along with this, always keep a backup for your business by opting for small business insurance.
Accounting and bookkeeping: Right from the start, regularly keep the records of accounting in order to avoid any type of future financial crisis.
Financing a Business: Various Options
After the business plan and idea for starting a small business is finalized, the next question arises for arranging funds. Before arranging, calculate how much capital is needed and then look out for various options available. Being a small-scale business, your first dependency is on your personal savings. Other options available are investors and banks. But the financial institutions and investors will always ask for a share in the management and profits. Moreover, you may also need to submit collateral as a back up for the money borrowed.