A business plan is the blueprint for your company. It will both act as a guide for the future of your business and as a deliverable for potential investors.
Small businesses are the backbone of the United States. According to the Small Business Association, small businesses make up 99.9% of businesses in the US. Over 600,000 small businesses are started each year!
If you’ve got a hankering to start a small business of your own, we’re here to help! Read on to learn the steps you need to take in order to set your small business up on the right foot.
Step 1: Have an Idea
Every business starts with a bright idea. One of the most amazing things about the world we live in is this: 600,000 new businesses are started each year, and there are still new, bright ideas popping up everywhere. The world we live in is so full of possibilities!
If you’re having a hard time coming up with a new idea, use these questions to help guide you:
- What is a problem you have in your everyday life? How can you solve it?
- Where do you see holes in your life? How can you fill those?
- What are products that you use every day? How could they be better?
- What do you know how to do that other people don’t?
By thinking about these questions, you’re sure to come up with a business idea that may just be the next big thing.
Step 2: Conduct Market Research
Now that you have your big idea, it’s time to learn whether it can sustain itself as a business. In order to do so, you’ll need to conduct what is known as “market research”.
Market research helps identify two main things:
- Is there a demand for your product?
- Will your product satisfy that demand?
Let’s talk about the first: is there a demand for your product? You likely developed your product based on a problem in your life and a need for a solution. Market research asks whether the problem your product solves is a common problem. If so, is it problematic enough that people are willing to pay for a solution?
The second question asks whether your product will satisfy that demand. Is your product appealing to the people who may need it? Does it function in a way that works for their needs? Could it be modified in a way that better suits their needs?
All of the above will be revealed through market research.
Step 3: Do Competitive Research
Market research tells you about your customers; competitive research tells you about your prospective competition. Competition is inevitable in today’s marketplace. And it turns out, that’s a good thing. Competition leads to innovation, efficiency, and can lead to savings for your customer.
Competitive research answers two questions:
- Who will be your competition?
- What differentiates your product from theirs?
Through competitive research, it’s important to determine whether your market is oversaturated. Does the supply for your product outweigh the demand? Is there room for your product to have any portion of the demand?
Competitive research also gives you a great opportunity to ensure that your product stands out from the competition. What makes your product unique? Is that enough to sway customers to choose you over the competition?
Step 4: Make a Business Plan
A business plan is the blueprint for your company. It will both act as a guide for the future of your business and as a deliverable for potential investors. It will also take you through invaluable exercises that will help you build out your business.
A business plan answers the following questions:
- What is your company?
- What are your products?
- What does your market look like?
- What equipment do you need?
- What does your competition look like?
- What is your organization and management?
- How will you market?
- What do your financials look like?
Step 5: Hire
Now that your business is fully fleshed out, it’s time to get moving! Time to hire your first employees. Start by attending networking events and using job search websites to get started. And don’t forget to set up your company website, too.
When interviewing employees, make sure they interview with a few different people. It’s always better to get more eyes and more opinions on candidates. No matter what, always run pre-employment background checks for employees on whoever you’re looking to hire. A single bad apple can cause problems for an entire company.