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Five Crucial Components to a Successful Business Startup

Posted by Brandy on March 21, 2013

Interested in opening your own business startup, but don’t know where to begin? Start with these five crucial components:

  1. research the market and your competition
  2. make an inventory list of the supplies you’ll need
  3. talk to your lawyer about company structure
  4. write a business plan, and 
  5. secure financing

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Research the Market and Your Competition

Do people want the products and services you provide? Who would be your typical customer? How can it help them? Are your products and services seasonal? Are there companies that offer the same products and services as you? How do their prices compare to yours? Has there company grown lately? What’s the difference between your company and your competition? What would be your competitive advantage? These are some of the questions you need to ask yourself when you do market research. It’s important to learn more about the marketplace including your competitors to determine if your business idea has potential. It’s also a helpful exercise that will help you analyze your strengths and weaknesses.

Make an Inventory List

Once you’ve learned a little bit more about your products and services, the next step is to make a list of what you’ll need to make and sell them. The assets and materials you’ll need could range from an entire building to set up manufacturing to your basic office supplies.

Talk to your Lawyer

What is the tax structure of your business? For example, will it be a Sole Proprietorship, Partnership, C Corporation, S Corporation, or Limited Liability Company (LLC)? Are there any licensing or zoning laws you need to adhere to? Do you know how to register your business name? A lawyer can help you decide upon and set up these aspects of your business.

Write a Business Plan

If you’ve done your market research, made an inventory list, and know your legal set up, then it’s time to get it all down on paper. It’s easy to write a business plan with business planning software, such as Ultimate Business Planner. This program walks you through the process of writing a business plan. You’ll enter in company information including your company name, tax structure, and ownership distribution. Then you’ll enter your income and expense projections. These projections will automatically feed into financial reports and graphs, such as a profit and loss statement, balance sheet, cash plan, cash summary, financial position, break-even analysis, and ratio analysis. The final step in writing a business plan is to add details about the company, its products and services, competition, management, and operating plan.

Secure Financing

You’ll need money to actually launch your new venture. Not only will the business plan help you organize and run the business startup, it will also help you secure financing. You could use the business plan to solicit funds from family and friends, venture capitalists, a small business loan, or a line of credit at a bank. 

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