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Starting a business is definitely no easy task. Not only do you need some cash, but you need the discipline and courage to see your venture through.
That means starting a business isn't for everyone.
But for those up for the task, it's comforting to know that there is some help out there.
In this article, walk you through a step by step checklist for starting your very first business.
The Ultimate Checklist For Starting A Business
So, when I start my wildly successful baking subscription box, I’ll make sure I follow some essential steps he took to make sure my business lasts and grows like a champ.
I’ve mapped out several steps my brother took that I’ll share so we can all make sure to set our new businesses up for success:
1. Brainstorm Your Business Ideas
Okay, here’s the fun part. If you have an idea you’re passionate about, you’ve probably shared it with friends over dinner or drawn up a basic plan of what you’d like to accomplish.
Now it’s time to really dive in and hash out all the details of what your product or service could accomplish.
You can sit at your computer alone and endlessly search online for snappy name ideas and find out if your product is needed, or you can make it a structured time with some helpful friends.
I’d recommend setting a time to get together with a few trusted friends or professional connections that can ask you the right questions.
Think “Have you thought about only offering a few products instead of many?” and “What is the demographic you’ll be targeting?”, point out any holes in your ideas, and offer helpful ideas for honing in on the specifics of your product or service.
Actually, you’ll probably need some time and more than one brainstorming session to come up with a really substantial plan for your business.
My brother had several conversations with me and my husband, and he also enlisted the help of a successful businessman he knew that could provide some tips and even financial backing (more on that later).
So, make sure you grab some helpful friends or colleagues, set aside a few sessions, and have the necessary tools.
You’ll probably want a white board for mapping out your ideas in a visual way, you’ll need to do some research beforehand to come to the session with ideas, and you can even print out some statistics and market research you’ve done to bring to the group.
Come prepared, and have others in the group do the same.
The brainstorming phase doesn’t ever really end, as new ideas are what makes every business feel fresh.
But, once you:
- Have a clear idea of what you want to do/sell
- Know your plan like you do your own breaths
- Have answers to all the biggest questions about your business
iI’s time to start thinking about how you’re going to take this idea and actually turn it into a full-blown business.
2. Find Your Niche
So as you’re brainstorming, you’ll want to nail down your market niche, which just means your specific place in the market.
It’s your specialty, what only you can offer. What need does your product meet that nothing else can?
How are you different from other companies offering similar products? How do you communicate your offering in a unique and captivating way? Who is your targeted customer base?
This “place” you find for yourself in the market ensures that your business is needed, and will be sustainable.
For my brother, his niche was entirely online coffee subscriptions that specialize in freshly roasted coffee, showcasing different roasters across America.
It ended up being a niche that only one or two other companies had entered, and so he strove to set his company apart by honing his branding to be simple, clean, and aesthetically pleasing to draw more customers that were interested in a great roast.
For you, it might be something else entirely.
Maybe you’re looking to cash in on internet meme-culture by creating a funny clothing brand online, or maybe you’re looking to save your clients some time by providing lawn services.
Whatever your business is, the goal of this phase is to decide exactly who you’re speaking to and then finding the best, most efficient & interesting way to speak to that audience.
This can be done through your products/services or maybe even through the branding you create.
Ultimately, this will be your business plan/idea in action, so don’t get discouraged if there’s a few bumps along the road.
That’s why you never stop brainstorming even after you’ve found your niche!
Once you know your plan and have established yourself within a niche in your market, you may be ready to start thinking about scaling your business in an effort to help it grow.
3. Decide On Investing And Inventory
Now we’re getting into the nitty gritty. It’s time to think about what you’ll need to actually start the business.
Do you have money saved up to cover the costs of starting and maintaining the business? Or do you need financial backing?
My brother had a generous businessman he knew offer to fund the startup of his business, in return for some say in how the operations went.
It’s good to establish a working agreement with someone if you’re going to get into business with them (even if they’re just investing with no actual presence in the operations of the business).
This way, the terms of their investment are clear, and you’re protected as the business owner if you want to make any necessary changes.
To make it legally legitimate, have the contract signed by both parties and notarized.
Inventory is pretty cut and dry. If you do offer a physical product, you’ll need somewhere to store it before sending it to the customer or selling it in a store.
Do you have the space to store your products if there is future growth in your business?
Or do you need to rent out a space to ensure you always have the materials and inventory you need on hand?
If you offer a service, think about the assets you will use to provide that service.
Do you have the space already to store these items, or should you look into a bigger space?
My brother decided that with the quick turnaround from roaster to customer, he would be fine to use his apartment to start storing and dispersing his coffee.
In the future, he’s hopeful that he’ll need a bigger space to house all of the potential new customers’ coffee!
In addition, if your business is entirely online, you may want to think about having a dedicated office space.
Sure, working at the kitchen table may be fine at first, but it might not work if you’re working there 8+ hours a day with many people flying through.
So, you’ll have to ask yourself whether your business can be run from your apartment or if you need to rent a space to work.
If you have an office in your home, this may be a great place to start, but remember, the goal of any business is to grow.
Start thinking now about where you might want to grow into later and the decision will be super easy for you when that day ultimately does come!
At the end of it all, this phase is just about making sure you give yourself enough resources so that you can invest & grow your business properly.
You don’t have to have it all figured out right away, but the leader in your business, you need to be prepared so that you can seize opportunities as they come.
Become Legit With An LLC
Now that you’ve decided on most of the details, it’s time to make sure your business is legit.
It might be time to form an LLC, to ensure that you aren’t personally liable for any business losses you might incur.
So, if the business goes under, you can’t lose your personal possessions like your home or car to pay back the debt you incurred within your business.
This also lets you file your business income on your personal tax return, in a separate area from any other sources of income you might have.
This is how I’m planning on differentiating between my incomes when I start my subscription box.
You could also form a Sole Proprietorship, which is similar to an LLC, but it doesn’t protect you from liability.
Down the road you might want to look into forming an S or C Corporation as your business grows, but a popular place to start is with an LLC when you first venture out, due to the above features.
All you have to do to form an LLC is:
- File your business name with your state
- Choose a registered representative to make decisions on behalf of the business (this can be you, the owner) and
- Form an operating agreement detailing the operations of your startup.
It’s as simple as those three steps!
Now that you’ve brainstormed, found your niche, figured out your finances and inventory, and become legally legitimate, it’s time to start documenting your business’ financial status day to day.
Start keeping a detailed log of your expenses and income to keep an excellent track of your revenue.
You’ll thank yourself during tax season when you have such detailed records showing your revenue and expenses!
Your qualified business expenses can be deducted from your taxable business income, so keep track of these.
You can also set certain benchmarks that you want your business to reach within certain timeframes.
My brother set out to get 7 customers before he launched his coffee subscription, and it was awesome to see him reach this attainable but challenging goal he set for himself!
Even in the midst of the hustle and bustle of running a business day to day, you can be encouraged when you reach goals and the only way to keep track of these is by documenting well.
The bottom line here is that the more organized you are, the better you’ll be at running the day to day operations of your business.
That means you won’t be over or underspending on vitale products or services, you’ll have a better understanding of how long it takes certain things to happen, and you’ll be more intune with how everything in your business works.
That all leads you to become a master of your craft and it all starts by just saving receipts, writing everything down, and keeping an organized planner of everything that happens, and is going to happen, within your business.
Use This Ultimate Checklist To Start Your Business
It can seem daunting to go out on a limb and offer your product or service to the world, but if you do your research and have all the ingredients in this checklist, you’re definitely more likely to be successful.
If you want to launch your own great idea, brainstorming, finding your niche, discussing investing and inventory, becoming legally legitimate and documenting your operations well can set you up for huge success!
It’s so important to go through this mapped out process for building your dream, and to check all the boxes in our checklist before you begin.
If you’re missing an item, work to complete it before starting your journey and you won’t regret it.
My brother is enjoying the growth of his coffee startup since he followed the correct steps and checked all the boxes in this checklist. When I venture out on my own, I’ll be sure to follow suit!