Starting a business involves planning, making key financial decisions, and compl
Starting a business involves planning, making key financial decisions, and completing a series of legal activities. These ten steps can help you plan, prepare, and manage your business.
Step 1: Write a Business Plan
A business plan generally contains the following parts (which we will expand on later):
- Executive Summary
- Company Description
- Market Analysis
- Organization and Management
- Service or Product Line
- Marketing and Sales
- Funding Request
- Financial Projections
- Appendix
Step 2: Get Business Assistance and Training
Take advantage of free training and counseling services, from preparing a business plan and securing financing to expanding or relocating a business.
Step 3: Choose a Business Location
Get advice on how to select a customer-friendly location and comply with zoning laws.
Choosing a business location is perhaps the most important decision a small-business owner or startup will make, so it requires precise planning and research. It involves looking at demographics, assessing your supply chain, scoping the competition, staying on budget, understanding state laws and taxes, and much more.
Here are some tips to help you choose the right business location.
Determine Your Needs
Most businesses choose a location that provides exposure to customers. Additionally, there are less obvious factors and needs to consider, such as the following:
- Brand image: Is the location consistent with the image you want to maintain?
- Competition: Are the businesses around you complementary or competing?
- Local labor market: Does the area have potential employees? What will their commute be like?
- Plan for future growth: If you anticipate further growth, look for a building that has extra space should you need it.
- Proximity to suppliers: They need to be able to find you easily as well.
- Safety: Consider the crime rate. Will employees feel safe alone in the building or walking to their vehicles?
- Zoning regulations: These determine whether you can conduct your type of business in certain properties or locations. You can find out how property is zoned by contacting your local planning agency.
Evaluate Your Finances
Besides determining what you can afford, you will need to be aware of other financial considerations:
- Hidden costs: Very few spaces are business ready. Include costs like renovation, decorating, IT system upgrades, and so on.
- Taxes: What are the income and sales tax rates for your state? What about property taxes? Could you pay less in taxes by locating your business across a nearby state line?
- Minimum wage: While the federal minimum wage is $7.25 per hour, many states have a higher minimum. View the Department of Labor’s list of minimum wage rates by state.
- Government economic incentives: Your business location can determine whether you qualify for government economic business programs, such as state-specific small-business loans and other financial incentives.
Is the Area Business-Friendly?
Understanding laws and regul