Did you know that 99.7 of American businesses are considered small businesses? In the US, there are 28.8 million small businesses.
Each of those businesses was started by someone who had the drive to start a career for themselves by starting their own business.
If you are tired of working for someone else, you might be wondering how to start a business of your own.
No matter what type of business you want to start, there are a number of things that you want to know before you start building websites or leasing commercial space. Let’s take a look at what it means to be a business owner and how to become one.
What Are the Benefits of Being a Business Owner?
There are a lot of risks involved when you start your own business. However, the benefits are so appealing that many people find it is worth taking the risk.
Independence and Flexibility
When you work for yourself, you have much more independence and freedom than when you work for someone else. If you are able to scale your business and hand off responsibilities to others, you might not even have to work that much at some point down the line.
Many people find that it is more satisfying and fulfilling to run your own business than to work for someone else. For some small business owners, there business is synonymous with their purpose in life. It takes courage to start a business, and becoming a business owner can earn you the respect of others.
When you start your own business, you no longer have the security of a steady paycheck. However, if you are successfully running a business you have the opportunity to make a lot more money than the standard employee.
While power is something that can go to people’s heads, it’s no surprise that business owners can enjoy that they are the top of the totem pole. When you work for someone else, there is always someone else that is more powerful than you. In your own company, the buck stops with you.
How to Start a Business
Starting a business is no walk in the park. It takes a lot of drive, organization, and determination. On top of that, almost all businesses will have some upfront costs.
That being said, setting a business can be a fulfilling and lucrative thing to do. If you are wondering how to make your career in business ownership, let’s take a look at how to start a business.
Refine Your Idea
There is a good chance that you already have an idea of what you want to sell or what service you want to offer. Before you get ahead of yourself, you’ll want to make sure that your idea is solid.
You’ll want to do research into your chosen industry and learn about the current leaders. It’s important that your business offers a solution to a problem that a customer is willing to pay for.
It’s also important that you are able to offer something better, cheaper, or faster than the competition. Otherwise, you will not succeed in a saturated market.
As a part of refining your idea, you’ll want to clarify your target customer. It’s important to know who your customer is, what they are like, and what problems they have that they would like to solve. If your target demographic will not be interested in purchasing what you are offering for the price you’re asking then you need to go back to the drawing board.
Write a Business Plan
Once you have a business idea, it’s time to start writing a business plan. You will need to ask yourself some important questions, including:
- What is the purpose of your business?
- What are your and goals?
- Who are you selling to?
- How would you finance your startup costs?
A business plan is a document that answers these questions. You’ll want to conduct market research to understand your target customer better and come up with an exit strategy for your business.
Assess Your Finances
Almost any business is going to come along with some start-up costs. You will need to figure out how you are going to pay for these expenses. Maybe you are able to fund yourself or maybe you will need to borrow money. If you are quitting your day job in order to start a business full-time, you’ll want to make sure that you have enough money saved that you can float your personal expenses until your business becomes profitable.
If you need to borrow money, you have a number of options. You can try to take out a business loan, apply for business grants, find investors, or launch a crowdfunding campaign. You also might be able to borrow money from a family member if they are open to supporting your business.
Determine the Legal Structure of Your Business
You will need to decide what kind of business entity your company is before you can register it. The structure of your business impacts your personal liability if something goes awry as well as how you file your taxes.
The different business structures you will likely be choosing from our sole proprietorship, partnership, corporation, and limited liability company. Depending on your circumstances, one of these options will likely fit your needs the best.
Register With the IRS and the Government
Before you can legally operate your business there are likely a number of business licenses you will need to acquire. Your business must be registered with local, state, and federal governments.
Depending on what type of business your starting you might need additional licenses. Different states have different requirements, so you will want to research what is required in your state.
Getting insurance for your business is important in order to protect it financially. You never know what is going to happen, and there are a number of possible occurrences that could be very costly.
If you are going to employ other people, you will need to purchase unemployment insurance and worker’s compensation insurance.
Depending on your industry and your location, you might need other types of coverage. Most small businesses will need general liability insurance. This is a policy that covers bodily injury, personal injury, and property damage.
You also might want to purchase professional liability insurance if you offer a service as a business.
Purchasing the right insurance is essential. The insurance policies that you purchase could be the difference between your business being protected and financial ruin.
Build Your Team
Perhaps you are planning on starting a one-person online business. In this case, your team is already built!
If you are planning on hiring other employees, however, you’ll want to start building your team. The people that you work with are a major part of what makes your business success that it is. It’s worth it to invest time and energy into finding the best team you can.
Select Your Vendors
It is likely that you will hire some vendors as a part of your business. There are a wide variety of third-party vendors in every industry to help you run your business.
For example, some industries will require specialist hosting, specific software, particular business phone features, and more.
Brand and Market Your Business
The next step to start a business is to start telling people that you exist.
You’ll need to set up a company website. This is the hub of all of your online activity. As a part of setting up your website, you will need to create a brand identity that will inform every aspect of your marketing, from the voice of your copy to the color scheme of your logo.
You also need to set up social media accounts. This is a great way to advertise your company and build a following of loyal customers.
Another useful marketing tactic is to set up an email marketing campaign. You will need to build an email marketing contact list in order to reach the widest and most targeted audience possible.
Once your business is off the ground and running smoothly, you can turn your focus towards growth. Depending on your business, you might have different goals for how big you want to grow.
For some people, they might be satisfied with less responsibility and a decent profit. Others might be driven to grow the company as large as possible, taking on a lot more responsibilities and potentially taking home a lot more profit.
Online Business Ideas
There is something so appealing about starting an online business. Many people have a picture of lounging around at home in their pajamas and raking in tons of money for doing next to nothing.
While some skilled or lucky people might have a second chance like that, for most running an online business is a lot of work.
If you are planning on starting an online business, you basically have three possible business forms. The first is an e-commerce site that sells products online, the second is selling information products, and the second is selling professional services.
Some people might opt to run an online business that operates using an existing service. For example, people might choose to sell products through Amazon, Etsy, or eBay rather than starting their own storefront.
Anything that you can legally sell and ship to others is a potential idea for an e-commerce site. When choosing your niche, you want to do a lot of market research to ensure that the market is not saturated and that you will be able to hone in on your target market.
Information products are things like e-books, online courses, webinars, and podcasts. If done well, this can be an effective way to create a source of passive income.
Professional services are services you offer such as consulting, writing, web design, digital marketing, and more. Many professional services ideas are reasonable businesses to start with low upfront costs.
Home and Remote Business Ideas
You do not necessarily have to start a business online. There are a number of remote business ideas that you can start where you are physically interacting with objects or other people but you are doing so at your own home.
Examples of this type of business include tutoring, home-based childcare, and professional consulting. You could also flip objects you find at thrift stores are estate sale, drive for Uber or Lyft, rent a room on Airbnb, or becoming a pet sitter.
Local Business Ideas
There are also a lot of opportunities for starting local small businesses. When you create an effective business that you market well, local businesses can actually be quite lucrative. It is important to run the numbers on how much it will cost you to run the business versus how much you expect the business will make.
Local service businesses can be a reasonable type of business to start that is quite scalable. You might consider starting a landscaping company, a plumbing company, or a house painting company.
Are You Ready to Start a Career Where You’re the Boss?
It can be incredibly rewarding to run your own business. Whether you are planning on starting a business of one or hiring dozens of employees, there is something truly special about being the captain of the ship.
Starting a business is no small feat, however. It’s important to understand the risks and potential rewards before leaping in.
Did you find this article on how to start a career as a business owner interesting? If so, be sure to check out the rest of our blog for more fascinating and informative content!