Are you wondering how to start a business successfully? We often have a desire to start a business, but we do not know how to start and what is the list of things needed on how to start a business successfully. We have made an article analyzing ways to start a business, so you can start taking the first steps in becoming a successful entrepreneur.
One of the first things before you even start your business is to make sure to validate that there is a demand for what you are offering and after you validate that there are people interested in buying your products and services, then you can actually start setting it up from a business and legal perspective.
So I have divided ways on how to start a business successfully into two crucial sections: Pre-startup phase and phase of setting up your business.
In the pre-startup phase of starting a business, you want to not only discover your key strengths and passions first and give yourself every possible opportunity to leverage them each day but also to determine if there is a market need for what you are offering.
Here are some of the steps you can take to start a business successfully:
Step 1. Ask Yourself if You’re Ready To Start A Business
There will never be a “right time” to start your business. When it comes down to whether you’re ready to start a business, it’s more about mindset rather than the timing. So ask yourself this question: Are you in the right mindset to win?
Step 2. Determine What Type of Business to Start
The next step of starting a business is to figure out what type of business to start.
For example: are you looking to turn your hobby into a business? Or Is there a niche that you’re particularly passionate about? These are just a few questions you need to ask yourself in order to determine the type of business to start. One of the ways to determine that is to create a list of the things you’re passionate about. It could be anything from yoga to personal finance. Every person has different passions. The question is: What is yours?
Step 3. Do Some Market Research Before Starting A Business
a. Understand Customer Problems
First, you need to understand the problem your customers are having by starting market research and get behind your customers’ wants, needs, and desires. You need to identify your target market and know to whom exactly you are selling. This will help a lot in your first steps on starting a business
A few things you could do to get started are:
- Find top influencers – find the top 10 influencers in this niche in order to gain some business ideas.
Who do other people look up to in this niche? Check out their social media profiles. What things are they saying? What things are getting the most likes?
- Research blogs on business ideas – read the top 10 blogs in this niche and see what they have in common. Look at the most popular post on those blogs and check the comments sections. What are people saying? What are people agreeing on and what are they mostly complaining about?
- Find Top FB Groups – find the top 10 FB groups related to that niche. Start doing research and see where there are the most members in the group and start joining these groups. Start looking at the posts and members’ comments. What are they talking about? What are the most liked posts and what do these posts have in common?
Keep in mind to write these down because you might be able to re-use them down the line
b. Analyze Your Competitors
Identify the top 10 competitors and analyze their content.
Some of the things to look at are: their content, SEO and Social media.
During your research, the key here is to identify areas for improvement so you can start doing it better.
There are many ways to identify key competitors in your industry, but you can start with a simple search around overarching business ideas.
c. Talk to your customers
There are many ways that you can talk to your customers to get feedback.
Here are two things you can do right away:
- Create a survey – google survey has a free option where you can create a survey with questions to ask your customers directly. What you want to do is you want to consider contacting 20 – 50 people in the niche personally and asking them some questions to thoroughly understand their situation and what problems they face, as well as what desires they have.
- Conduct customer interviews – The startup approach to entrepreneurship is based on a simple idea: quickly find out what works and discard the rest. That way you’ll discover if your idea is worth pursuing before putting a lot of time and effort into it. One of the key ways that entrepreneurs uncover what works is through customer interviews to discover critical information such as: What do the customers really need? Does your business idea meet that need?
Step 4: Your Offer
a. Create your Minimal Viable Offer
The purpose of building an MVO is to launch quickly, based on your idea, with a small budget. This approach allows you to collect users’ feedback for the primary product and include it in future iterations. With the help of an MVO, one can find the right audience, pull the ideas based on experience, and save time.
b. Pre-sell your offer
A lot of you may be asking questions like: How do you get people to buy something that does not exist? How can you create, launch, and sell your offer before it is done? The answer is simple enough: Take a look at the research that you have done on your customers or join the social media groups where your ideal client is, and promote your pre-sale to a select group of people by focusing on resolving their problems and challenges. You can interact with these users one on one and offer them a chance to “sample” what you have to offer. Sounds interesting?
c. Start a pilot group
Pilot programs can help you find out if there is a market for your product or service and where this market exists. In short it is a valuable insight into the challenges that need to be addressed.
Step 5: Generate Sales
Sales and marketing are critical steps on how to start a business successfully, so your business can actually generate revenue. We will analyze below some things to follow in order for your business to start generating sales.
You can start by listening to your potential customers to know their wants, needs, likes, and dislikes. Next you need to ask for a commitment without pushing too much. In other words, do not force your customers in buying your products or they may never return.
Another thing to do, is learning to accept “No” for an answer. Sometimes people might listen to your elevator pitch simply because they are polite rather than having an intention to buy. The key here is to not get discouraged if they do not buy from you
One last thing to do is put out advertisements to find an audience to fit your business. At this point, you’ll also have to figure out the right sales funnel and strategy to generate leads and convert them into paying customers.
Setting up your business
Once you have completed the pre-startup phase of your business it is time to move on to activities on actually setting up your business, so you can ensure to start a successful business.
Here are some of the steps you can take to ensure your business success:
Step 6: Start drafting your business model canvas
If you are just starting out or opening your business, you are probably thinking about writing a business plan, and you probably are wondering how to begin doing just that.
Most people hate writing business plans. They are just too long to write, there are too many areas that you would need to know about your business, but how can you know when you have not even started yet?
And then at the end, who is going to read it?
Lucky for you there is an easier way where you can still document your business goals and activities in a fast, concise, and portable way. And that way is by creating a Business Model Canvas or BMC as they like to call it.
Let’s break down what exactly is the BMC:
The Business Model Canvas is a tool that enables you to visualize, design, and update your business model as you go. It helps you identify key elements of your business, so you can develop a clear view of your value proposition, operations, customers, and finances to decide where you need to focus your time and attention as you start your online business.
So, what does a business canvas look like? Here are some key points.
If you don’t recognize all of these terms, no need to be alarmed. Keep on reading to find out more about the 9 key elements you need to focus on.
1. Customer Segments
The first step is to understand who your customers are. Who are you resolving a problem for, or fulfilling a special need? You need to understand them well. What do they need, want, like, and feel? A good thing to do is, research the market around your customers’ needs, making sure that you are crystal clear on your customer’s needs and wants, so you can tailor your business around resolving their problems and challenges.
2. Value Proposition
So if you have done some market research about your customers, you should know all about what they are struggling with, what are their problems and challenges. This will help you get clear on what value you are going to deliver to the customer.
Think of it this way: What problems and challenges are you helping to solve? And what things do you have to offer them for a customer to pick you over your competitor?
Channels are all about where you are communicating with your customers. What platforms are you using to reach out to them? Do you have a website, e-commerce store, social media profile, email marketing platform? Write them all down here. And remember you don’t need to be active on all of these platforms. Choose the ones that work the best for you and your customers.
4. Customer Relationship
Customer relationships will help you get clear on what type of relationship you have with your customers. How do your customers interact with you from the moment they get interested in your offer, to the time they make a purchase? Is the communication strictly online, is there a dedicated person or a team to manage your customer relationships?
Answering these questions is a crucial thing to do in your business.
5. Revenue Streams
This is all about how your business makes money. What are your customers willing to pay for and how does that add up to your revenue? How are you planning to make money with your business?
Let’s take an example here to help you understand better:
If you are a coach, are you offering online training materials, 1:1 coaching sessions, do it for your services? What is the driving force in your business’s income?
6. Key Activities
Key activities are related to your value proposition. What are the key things you need to do in your business in order to deliver the best possible value to your customers? If you are a business coach, problem-solving and customer service will be the key activities you want to focus on to make your customers happy.
7. Key Resources
What resources does your company require to bring your business to life? Do you need physical resources like buildings, vehicles, or machines? Do you need intellectual resources around building your brand, maybe creating partnerships? Or do you need human resources to manage your business, or maybe financial help in terms of cash or credit?
8. Key Partners
Key partners are the relationships that you have with other businesses that will help you deliver value to your customers? What external partners do you need to perform your key activities? If you are selling physical products who are your key suppliers?
9. Cost Structure
Cost structure will help you define all the costs and expenses that your business will incur. Are your costs fixed or variable? You should ask yourself how do your key activities drive your cost structure? If there are any cost components that are not directly linked to your key activities, I would go back and see if these costs are really necessary.
And now you are done with mapping out the first version of your business model canvas.
But remember to update the document as you go on creating your business because it is needed in the first steps of opening a business. If one thing does not work, you get to test another and update your business model canvas, so you always have a one-page view of the most important business activities you need to focus on.
To download a free template of Business Model Canvas click HERE
Step 7: Fund your business by bootstrapping
Your business plan will help you figure out how much money you’ll need to start your business.
Sometimes we have some money saved up but if you don’t have that amount on hand (or the amount is not enough to get your business off the ground and running), you’ll need to either raise or borrow the capital. Fortunately, there are more ways than ever to find the capital you need. So take a look at your business plan and find out exactly how much money is required to get your business off the ground running
Step 8: Choose a business structure
The legal structure you choose for your business will impact your business registration requirements, how much you pay in taxes, and your personal liability.
A quick review of the business structures according to US Small Business Administration (SBA):
1. Sole proprietorship:
- A sole proprietorship is easy to form and gives you complete control of your business. You’re automatically considered to be a sole proprietorship if you do business activities but don’t register as any other kind of business.
- Sole proprietorships do not produce a separate business entity. This means your business assets and liabilities are not separate from your personal assets and liabilities. You can be held personally liable for the debts and obligations of the business. Sole proprietors are still able to get a trade name. It can also be hard to raise money because you can’t sell the stock, and banks are hesitant to lend to sole proprietorships.
- Sole proprietorships can be a good choice for low-risk businesses and owners who want to test their business idea before forming a more formal business.
- Partnerships are the simplest structure for two or more people to own a business together. There are two common kinds of partnerships: limited partnerships (LP) and limited liability partnerships (LLP).
- Limited partnerships have only one general partner with unlimited liability, and all other partners have limited liability. The partners with limited liability also tend to have limited control over the company, which is documented in a partnership agreement. Profits are passed through to personal tax returns, and the general partner — the partner without limited liability — must also pay self-employment taxes.
- Limited liability partnerships are similar to limited partnerships, but give limited liability to every owner. An LLP protects each partner from debts against the partnership, they won’t be responsible for the actions of other partners.
- Partnerships can be a good choice for businesses with multiple owners, professional groups (like attorneys), and groups who want to test their business idea before forming a more formal business.
The best thing to do though, is contacting an expert in order to have guidance towards the right direction. Sometimes help is needed in order to have a good legal knowledge of the things needed to be done.
Step 9: Choose your business name & Register your business
If a specific name isn’t available, you can always consider permutations of the name. Make sure your domain name and business name aren’t impinging on any registered trademarks.
A quick checklist of the things you might need:
- Federal tax ID
- State tax ID
- Permits and licenses (as needed)
- Business bank accounts
- Trademarks, patents, and copyrights (as needed)
Now what we recommend is contacting a lawyer in order to find exactly what the legal process is. Remember that there is no shame in asking for help!
Now that you know the steps to take on starting and opening a business.
There’s an exciting adventure ahead of you. Pushing yourself to finally take the first step can be a bit scary, but once you get started you realize that the process of starting a business can be pretty fun.
There will be challenges and roadblocks along the way but as long as you push ahead and learn from mistakes there’s nothing that’ll block your success. All you need to do now is take that first step and you’re well on your way to success.
Would love to hear your thoughts about it. Let us know in the comments below.